Desktop Metal CEO Says 3D Printing Now is Like eCommerce in the 1990s
3D printing hasn’t yet scratched the surface of the $12 trillion manufacturing industry, and investing in the technology today would be like getting in on eCommerce stocks in 1998 and semiconductors in the 1970s, said the CEO and Co-Founder of Desktop Metal Ric Fulop in an interview with Voices of Wall Street.
Additive Manufacturing 2.0: Desktop Metal is looking to transform the manufacturing industry and the way companies produce parts for businesses spanning a broad array of industries, including automotive, consumer products, industrial automation, medical devices, aerospace and defense. Fulop says the company’s tech makes metal printing more affordable and 100 times faster than previous forms of 3D printing, a.k.a. Additive Manufacturing 1.0.
“We've turned that technology into something very affordable, that's able to produce parts, roughly 100 times faster than legacy systems using lasers. And as a result, the parts are about 1/20th of cost, which is a dramatic change.”
Early innings of 3D printing: The additive manufacturing industry is estimated to grow from $12 billion to $146 billion over the next 10 years as it shifts from prototyping to mass production. Fulop says that the $12 billion additive manufacturing business is just .01% of the overall manufacturing industry.
First-mover in the auto business: Desktop Metal touts the horizontal nature of its technology and exposure to a wide range of industries, but carmakers, which make up roughly 20% of the company’s revenue, are currently the biggest opportunity. DM clients and partners include Honda, Nissan, Toyota, Ford, BMW, and Volkswagen. Fulop adds the technology can be used for consumer products made by companies such as Adidas and Callaway.
Like eCommerce in 1998: Due additive manufacturing’s small piece of the overall manufacturing pie, Fulop compares the technology’s potential to that of eCommerce in 1998 and semiconductors in the 1970s. For context, Amazon went public in 1997 with a market cap of $438 million. Now it’s worth more than $1.6 trillion.
Accelerated IPO: Desktop Metal went public via SPAC on December 10, but would have gone public two years from now if it weren’t for the pandemic, which Fulop says allowed companies to go public years earlier than initially planned due to remote roadshows and the stock market environment.
“We would have traditionally gone public with conventional IPO probably two years from now,” Fulop told Voices of Wall Street. “But I think the pandemic created an opportunity for folks to do a roadshow virtually over Zoom.”
SPAC stats: There have been 248 SPAC IPOs YTD, up from just 59 in 2019, according to spacinsider.com. The gross proceeds from SPAC IPOs has dwarfed the amount from previous years, with 2020 bringing in $71.8 billion in the U.S. alone as of December 3, according to data from Statista.
Desktop Metal has long been an investor favorite for exposure to 3D printing. In the private market, the company raised about $430 million from companies such as Ford, Koch Industries, and Google.
M&A hunt: Even though Desktop Metal has been a publicly traded company for less than a month, the company already has its eyes set on growth through M&A in the private segment, where Fulop says most of the 3D printing innovation happens. Desktop Metal has roughly $4.5 billion in currency between cash and stock today, with $600 million in cash. The company has said it has identified more than 60 acquisition opportunities.
