When I was a kid I was inspired by a book called the Diamond Age by Neal Stephenson. In the book the protagonist lives in a future where it will become possible to print 3D objects made out of diamonds - the world’s stongest material. In this future we won’t need factories and the largest and most powerful companies are those that make the tools, software and services to enable that vision. Kids learned CAD in school just like you learn languages or trigonometry.
Most of you who know me think of me as an entrepreneur that made batteries or was in the software or wireless business, however few of you know that when I was 18 years old I was dumb or crazy enough to start a company that built the first parametric 3D modeling package for the Mac. The software was called DenebaCAD and was inspired by the vision behind Diamond Age.
Recently, I read another New York Times best-seller book that reminded me we are solidly on that path. That book by Jeremy Rifkin is called The Third Industrial Revolution and I think its thesis is spot-on. We are on the cusp of a major shift enabled by 3D technology that will provide a long boom with lots of investment opportunities. This boom will reshape economies and geopolitical forces like the first industrial revolution or the Internet did.
The 3D market has been a long time in the making, but it finally feels like the ecosystem has matured to the point where we are about to see an inflexion point. A good analogy is looking at the Internet from 1975 to 1995 where things were too expensive and impractical for the mass market. That’s what the 3D market has been like for the past 20 years “a land that time forgot” where the core tools are only for engineers and cost thousands of dollars per seat. This is very rapidly changing with services like Proto Labs or Shapeways where anyone can get parts quickly and inexpensively, with the advent of affordable desktop 3D printers and new 3D software tools or platforms like GrabCAD and Onshape. This revolution won’t turn the world upside down overnight and perhaps it will be another 10 years until 3D printing and manufacturing in the cloud is completely commonplace but one thing is for sure, the momentum is now unstoppable.
The recent advances in 3D Printing, laser sintering and multi-axis CNC are completely going to change manufacturing forever in the same way that inkjet printers changed photography forever!o longer will you need to tool products in order to manufacture them or coordinate with multinational logistics. R&D parts will be as good as full production parts and they will be a lot less expensive. Moreover, for the first time enterprises will easily be able to offer customized products on a mass scale. This will be the ultimate global playing field leveler and is critical for U.S. competitiveness. Today’s modern airplane wings are no longer riveted. They are built from composites, cut on multi-axis CNCs and sent straight to curing. Our portfolio company Proto Labs (NASDAQ:PRLB) that we took public in 2012 is well on their way to building a multi-billion dollar business as the worlds largest provider of “manufacturing on the cloud” services. Companies like General Motors and Lockheed Martin use Proto Labs for everything from R&D to production parts. Engineers go straight from CAD to production parts in one day simply by clicking print! They are the enterprise equivalent of other exciting companies like ShapeWays that are doing a great job democratizing access to advanced manufacturing. I am convinced 5 years from now this market will be 100X larger than it is today and that created huge opportunities.
My firm, North Bridge, has been investing in 3D for close to 20 years. We’ve probably made more pure play 3D investments than all other east coast firms combined. This stems from our legacy as an original investor in SolidWorks. Today SolidWorks is the leading platform used to design 3D parts in the world! Last November, Jon Hirtschtick and Jon McEleney who founded and ran SolidWorks called to say they wanted to do it again and we led a $9M Series A for their new startup Onshape (previously under the stealth name Belmont Technologies) which aims to bring 3D design to the cloud. This was followed by a $25M Series B round led by NEA three months later and a $30M Series C six months after that.
Over the years we’ve also backed Revit, SpaceClaim, NewForma and other leading technology companies that today are key components of this 3D ecosystem.
This movement has many names. Some call it the maker movement which is the equivalent of the consumerization of 3D, some call it 3D Everywhere or 3D printing. I call it the dawn of the Third Industrial Revolution and I can’t wait to see what happens when we start to teach 3D or CAD in middle school!