I’m reading an interesting post by 3D Alliances about the hope for 3D print company stocks in 2024.
The article presents the evidence of the basically terrible investment results generally obtained by the 3D printing industry over the past few years. Basically, a series of venture capital firms poured unbelievable sums into a number of existing or startup 3D print companies, expecting massive returns within a few years.
Unfortunately, that has not happened. In fact, many of the companies accepting this investment are now worth vastly less than the original investment. According to the tracking done on our weekly leaderboard, some companies have dropped in value more than 90%. A few have even disappeared completely, a 100% loss.
These generally poor results have soured the investment attitude towards 3D print technology companies, and it’s now becoming much more challenging for firms to raise money. 3D Alliances wrote:
“Against the backdrop of the Covid-19 pandemic during 2020-2022, 3D printing stocks surged up to 10 times their original values, driven by the belief that Additive Manufacturing is a great solution to supply chain challenges. During this period, a few companies went public via SPAC mergers, capitalizing on the high valuations of veteran 3D printing companies.
However, 2023 marked a significant turning point from that perspective, bringing valuations back to normal levels. Investors came to understand that the Additive Manufacturing revolution is indeed on the horizon, but unfolding at a slower pace than initially expected.”
They forecast that in 2024 there may be a change due to a “tailwind” from the US election. They also suggest that there will be more mergers and acquisitions, along with cost-cutting to achieve profitability. Mergers and acquisitions are another way to cut costs: you don’t need two CEO’s, etc.
I’d add one more prediction to that list: we will see some companies simply shut down. Perhaps their assets (technology) may be acquired by a competitor for bargain-basement prices, but some companies will definitely disappear completely.
The technology, as it is current formed in the leading companies, is simply not suitable for the larger-scale manufacturing sector. That’s where much of the revenue was expected to come from, and it isn’t going to be coming.
But there’s one more thing to say about all this: Many talk about the entire industry being affected, and I guess that’s true in the sense of fundraising ability. However, my thinking is that the issues are centered around only certain companies that took the huge investments. They were the ones that didn’t come through.
Meanwhile, there are plenty of smaller startup companies with intriguing technologies that just might be more appropriate for large scale manufacturing. If you think about it, many of the major players in the industry today are essentially souped-up versions of desktop technologies that were suitable for prototyping, not manufacturing.
The new players have very different technologies that specifically focus on manufacturing. They just might be able to succeed in that market.
But will they get the money to get there? That’s the big question.
Via 3D Alliances
