3D Printing: The Basics
Robbie is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
As an engineer, 3D printing has been on my radar for quite some time. Only recently though has it been thrust into the mainstream as "The Next Big Thing". The concept is easy enough to understand. It has been used in local dentist offices for years as a way to make custom-fitted crowns for clients as they wait. 3D printing was likely used to prototype the phone in your pocket, the tablet on your desk and the office building you are sitting in.
The printer in your home prints in 2D with ink that dries very quickly. A 3D printer "prints" in a similar fashion, except instead of laying ink on the surface, it lays an area of chemicals (resin) that quickly harden. The next pass of the print head can add another layer and another until a 3D object emerges. Although it is easy to see how this could change so many things in our world, the first thing almost any user creates are novelty items which showcase their nerdy interest to the rest of the world. In a not-so-distant cube, Yoda and F-16s are standing as nerd trophies.
There are two sides to the 3D printing coin: The hardware (printers) and the software (modeling software). If we have learned anything from mobile phone and desktop computer market revolution, it is that hardware can quickly become a commodity and software companies are usually the ones profiting from the technology in the long run.
3D Systems (NYSE: DDD) has a robust 3D printer offering for the commercial and industrial markets. Their vision, though, is to have a 3D printer in each home. The latest product release, CubeX, is a desktop printing device at a fraction of the cost of comparable models. Here is more information about 3D Systems and a video of the $1,300 CubeX in action.
Stratasys (NASDAQ: SSYS) and 3D Systems are virtually tied in market cap. Stratasys produces three different series of products to cater to various market segments: The cool inventor dad desktop unit (Idea Series), the small company prototype machine (Design series) and the high-speed beast (Production series). The company's revenue line (green below) looks like the hockey stick graph Al Gore showed in An Inconvenient Truth. Note: Below chart stolen from this great article on Stratasys.
Makerbot is the cool, grass-roots market player. Not only do they produce competitively priced home-style 3D printers (Replicator 2 is $2,199), but they also have an Etsy-like marketplace called Thingiverse where geeks post their creations. In the first 3 years of the company's founding, they sold 13,000 3D printing devices and they are partially founded by Amazon's Jeff Bezos. They were even featured on Wired's October magazine cover.
Here is a comparison of 3D System's CubeX and the Makerbot Replicator 2.
All 3D printers listed above come with their own software. Before 3D printers were a thing, other software companies had robust modeling capabilities. Look for these software companies to play a greater role in the 3D printing world.
Solidworks (NASDAQOTH: DASTY). John Hirschtick, founder of Solidworks, was a member of the infamous MIT blackjack team portrayed in the movie "21" and the book "Bringing Down the House". In fact, it is with those earnings that he formed Solidworks in order to make 3D CAD technology more accessible. From personal experience with the CAD systems discussed, I can tell you Solidworks is my favorite. Over 90% of the changes made are user-submitted suggestions. The intuitive nature of the software could pay dividends in 3D printing. They've got their hands full though...
AutoDesk (NASDAQ: ADSK) already has a head start in the 3D printing game. Their model is a little different, and maybe a little better. They focus on content creation with free software available on tablet and smartphone devices and make it easy to upload your designs to one of their partners. For now, they are betting that you don't want a 3D printer at home. You just want your designs to show up on your doorstep in a few days. Or do you?
So, we've discussed the players. Who wins and who loses in the 3D printing game? Do you have skin in this game and if so, with who and why? I look forward to hearing from you.
Robbie Laney has no position in any stocks mentioned. The Motley Fool recommends 3D Systems, Dassault Systemes S.A. (ADR), and Stratasys. The Motley Fool owns shares of 3D Systems and Stratasys and has the following options: Short Jan 2014 $36 Calls on 3D Systems and Short Jan 2014 $20 Puts on 3D Systems. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!