Time to read: 3 min
Think back twelve months ago. Most hardware companies were reeling from consecutive quarters of sub-par financial performance due to the significant — literally overnight — drop in demand caused by COVID. Previously profitable, growing companies were slashing discretionary spending, completely restructuring, and implementing workforce furloughs and reductions. Survival was paramount. Those worst hit were often the industries most affected by COVID (aerospace, automotive) and/or burdened with high fixed costs due to expensive investments in plants and equipment. But where some saw disaster, others saw opportunity.
In the industrial space, the on-demand manufacturing business model has been growing for more than a decade. Companies see the value this model offers across a product’s entire lifecycle. Service bureaus (machine shops, 3D printing firms, etc.) provide product development teams outsourced access to technologies, machine capacity, design and manufacturing expertise, and quality standards comparable to internal production — all at a lower OpEx and pleasantly on the CAPEX side as well. The industry’s mantra is helping companies bring products to market better, faster, and cheaper. And this value proposition is validated every day.
Astute private equity and venture capital firms started to take notice. In 2021, we’ve seen over $1B raised in private capital and public offering events (SPAC + IPO) and I believe we’re just getting started (see William Blair Report – Advanced Manufacturing Technology Companies Changing the Way We Make Things). The inherent value of this industry and the need for digital solutions is massive. Companies are struggling to maintain competitiveness due to flagging sales, asset-intensive business models, or outdated legacy IT systems who are all screaming for modernization, digitization, and ultimately, the holy grail, better data + documentation — or a combination of all four. This need for and access to capital (accelerated by the advent of special purpose acquisition corporations) has driven mergers, acquisitions, public filings, and an overall swelling of market valuations for participating companies across the industry.
In 2013, my brother Nate and I founded Fictiv to radically transform manufacturing through technical innovation. I was the first hire at Ford’s Silicon Valley Innovation Lab and I experienced first-hand how legacy manufacturing processes blocked new product introduction and saw that mechanical engineers (like me) spent way too much time sourcing, vetting, and managing vendors. I knew there had to be a better way.
We built Fictiv with an eye towards digitization, automation, AI, and machine learning, through software and cloud services. Our long-term approach is paying off. We don’t invest millions of dollars in plants and equipment that typically sit idle 40% of the time. Instead, we invest in our self-service digital platform, optimizing performance across a quality-controlled global network of more than 250 highly-vetted manufacturing partners and a combination of AI-generated design feedback or real humans to engage with. Automation is best when you combine humans + machines to solve the hardest problems, especially in manufacturing. So we did just that. We build software to empower our people to be the most customer-centric organization powered by a globally distributed network for manufacturers. We call it Fictiv’s Digital Manufacturing Ecosystem.
With all the stresses created by COVID across an extended global supply chain(be it shipping-related, power-shortage related, or talent-sourcing related), our right-shoring approach (more than 60% of our manufacturing partners by numbers are located in the U.S. or Canada) helped our business snowball as we help manufacturers source parts quickly across all phases of their product development lifecycle (PDLC) and supplier rationalization strategies.
Our journey thus far has been educational and fruitful; with 16M parts delivered to supply chain managers and engineers, $100M raised, we have so much more to do. The possibilities are endless.
Come join us on this journey, and let’s reinvent manufacturing together!