Are 3D Printing Startups Shutting Down?
Well, it’s important to remember that 90% of startups fail, it’s not just 3D printing startups. The reasons that 3D printing startups fail aren’t entirely different from the reasons that other startups fail, either.
The number one reason startups fail is that they try to sell a product that people aren’t interested in. Now, obviously people are interested in 3D printing. But how much are people interested in what your startup is offering? If you’re a startup that’s trying to sell 3D printers, for example, you need to consider that the market for people who are interested in owning their own printer is actually pretty niche right now. It’s much easier and more cost-effective for most anyone to take advantage of 3D printing services rather than buy their own printer. (This is what we offer at Cad Crowd, and we are a startup that hasn’t failed 😉 )
As Dorian pointed out, anyone trying to sell 3D printers is going to be competing not only with more established firms but with the Open Source movement and RepRap. It’s hard to compete with free.
Of course there are also plenty of startups in the additive manufacturing/3D printing space that offer services besides selling 3D printers. But most of these startups will fail, too, and for the same reason. There is a lot of competition in 3D printing right now, and so any startup will need to offer something that sets them apart. At Cad Crowd, for example, we offer both contract manufacturing and access to a community of CAD designers who can create custom STL files. This sets us a bit apart, since we aren’t building a catalog STL designs, but a community of designers that buyers can hire for their own projects. So having a niche is important.
The other reason startups tend to fail, even if they have a great product and they have found a niche, is failure to gain traction or to properly market the product. It is a fallacy to think that “if you build it, they will come”. The reality is that, because the space is so competitive, you need to be creative in putting yourself out there and to be diligent in gaining users and traffic if you want to succeed as a startup. Many startups fail because they do not invest enough into market research and their marketing strategy. This is something that any startup should take seriously right from the beginning. A lot of new entrepreneurs think that their product will speak for itself. The problem is that without a marketing plan, no one will hear it.
A lot of people make the mistake of thinking that, because 3D printing is kind of a hot topic right now, that simply launching their business will be enough to generate all the traffic they need. But they are wrong. It’s difficult for startups to get attention when they are competing against much better established brands. So focus on your outreach strategy right from the beginning, and don’t rely on Google to just automatically bring traffic to your site!
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