20VC The Future For 3D Printing Why European VCs Are More Conservative Than US VCs & How 3D Printing Truly Changes The Manufacturing Process with Peter Weijmarshausen, CoFounder & CEO @ Shapeways

In this episode of "20 Minutes VC," host Harry Stebbings interviews Peter Weimershowson, CEO and co-founder of Shapeways, a leading 3D printing marketplace. Shapeways has garnered investment from prominent firms like USV, Andreessen Horowitz, and Index Ventures. Peter recounts the inception of Shapeways in 2007, inspired by the potential of 3D printing to transform digital files into physical objects without human intervention. He discusses the evolution of 3D printing, from its initial obscurity to its current potential in revolutionizing manufacturing, emphasizing the need for industry improvements in machine reliability, service availability, and material costs. Peter also reflects on the challenges of fundraising during the 2009 financial crisis, the advantages of being incubated by Philips, and the strategic move of Shapeways' HQ to New York. The conversation touches on the impact of 3D printing on B2B and B2C supply chains, suggesting a future where consumers drive product creation.

• Harry Stebbings hosts the podcast and invites feedback on his blog and Snapchat.
• Peter Weijmarshausen, CEO and co-founder of Shapeways, is introduced as the guest.
• Shapeways is a 3D printing marketplace and community with notable investors.
• Peter's previous roles include CTO of Sanjin and Director of Engineering at Aramisca.
• Thanks are given to Albert Wenger at USV for introducing Peter.

"This is the 20 minutes vc with your host Harry Stebings, and you can find me on the blog@mojitovc.com."

Harry Stebbings introduces himself and his blog, inviting feedback from listeners.

"So joining me today, I'm very excited to welcome Peter Weijmarshausen."

Harry Stebbings expresses excitement about having Peter Weijmarshausen on the podcast.

• Xero is advertised as an online accounting software for small businesses.
• Features of Xero include managing accounting, sending invoices, tracking cash flow, payroll, inventory, and real-time collaboration.
• Xero can be customized with over 500 business apps.
• Pearl's rear vision, a wireless backup camera and alert system for cars, is promoted.
• Pearl's product is solar-powered, installs in minutes, and receives software updates.

"Well, that's where Xero come in. Xero is beautiful, easy to use online accounting software made for small businesses."

Xero is introduced as a user-friendly accounting software solution for small businesses.

"Pearl's rear vision is the only wireless backup camera and alert system that installs in minutes and updates throughout its lifetime."

Pearl's rear vision is described as a unique, easy-to-install wireless backup camera system for cars.

• Peter Weijmarshausen was introduced to 3D printing by a friend.
• He was fascinated by the ability of machines to create physical objects from digital files without human intervention.
• Peter reached out to his contacts in the Blender community for 3D files to print.
• He conceived the idea for Shapeways, a platform for people to upload designs and receive physical products.

"It took me a while to realize that he was saying that there were these machines that are actually capable of transforming a digital description of an item, of a product into a physical thing without actually any human intervention."

Peter Weijmarshausen shares his initial reaction to 3D printing technology and how it inspired the creation of Shapeways.

"Wouldn't it be great if there was a website where people could upload their own designs and then had them made for them and then shipped to their home?"

Peter describes the foundational idea behind Shapeways.

• In 2007, awareness of 3D printing was almost non-existent.
• The 3D printing industry experienced a bubble with inflated expectations and stock valuations, followed by a drop and disillusionment.
• The technology has slowly gained serious attention again.
• Initially, the development of 3D printers was slow, but recent involvement from companies like HP has spurred innovation.
• Peter anticipates that 3D printing will revolutionize manufacturing and is now in the value creation phase.

"Back in 2007, I think the awareness of the technology was almost zero."

Peter Weijmarshausen reflects on the lack of awareness of 3D printing technology when he started Shapeways.

"Now the market is really reacting to the potential that people are starting to see that 3d printing might revolutionize manufacturing, which I think it will."

Peter discusses the current market's reaction to 3D printing and its potential impact on manufacturing.

• Peter shares the challenges of navigating market cycles, such as the boom and bust in 3D printing.
• He emphasizes the importance of maintaining a realistic perspective during both good and challenging times.

"I'm intrigued then what's it like for you as a founder, going through those market cycles of boom and then a trough of disillusionment and then recovering?"

The host inquires about Peter's experience dealing with the fluctuations of the 3D printing market.

"How do you, in the good times, try and keep reality very prominent and kind"

The host asks how Peter maintains a realistic outlook during prosperous periods in the business cycle.## Managing Expectations in Emerging Technologies

• Peter Weijmarshausen discusses the challenges of managing expectations during the hype of emerging technologies like 3D printing.
• He emphasizes staying level-headed amid the roller coaster of hype and disillusionment.
• Peter acknowledges the overinflated expectations of company growth and valuation during peak media attention.
• He expresses disappointment at the 3D printer manufacturers for not fully embracing the potential of 3D printing for manufacturing.
• Peter foresaw the inevitable trough of disillusionment when the market realized the limitations of the technology at the time.

"Well, I think for some reason or other I've always been pretty level headed about things. Whether they're a hype or whether they're the opposite. It's disillusionment."

This quote highlights Peter's balanced approach to the fluctuating perceptions of 3D printing technology, maintaining a realistic perspective regardless of external hype or pessimism.

"But of course, with all that attention comes somewhat of overinflated expectations of growth of the company or maybe growth of valuations and other things."

Peter points out the unrealistic expectations that can accompany widespread media attention, which may not align with the actual progress or capabilities of the technology.

• Peter Weijmarshausen envisions 3D printing as a transformative force in manufacturing, beyond just prototyping.
• He advocates for a new approach where 3D printing is the central step in the manufacturing process.
• Peter calls for improvements in machine reliability, service availability, and the decoupling of machine and material sales to reduce costs.
• He sees the potential for a more competitive market in materials, which could lead to more affordable 3D printing and benefit all stakeholders.

"Well, not necessarily to the hype, but what I would love to do, and I keep talking to them about it, and I'm still having conversations, is to really fully embrace that 3d printing is not only about prototyping, but it's also about real manufacturing, digital manufacturing."

Peter expresses his desire for 3D printer manufacturers to recognize and develop their technology for end-to-end manufacturing, not just prototyping.

"And for that to happen, the machines need to be bulletproof, they need to behave like real factory tools, which means that their availability and uptime is great, that service doesn't take a lot of time."

He emphasizes the need for durable and reliable machines with consistent service to support continuous manufacturing processes.

• Peter Weijmarshausen discusses the potential impact of 3D printing on business-to-business (B2B) supply chains.
• He suggests that the true value of 3D printing lies in creating finished products rather than components for assembly.
• Peter points out the lack of adoption of 3D printing in industries like jewelry and toys, where it could be highly beneficial.
• He compares the reluctance to adopt disruptive technologies to the postal service's slow adaptation to digital communication.

"So I think what everyone currently still is struggling with is how does 3d printing really change manufacturing?"

Peter identifies the ongoing challenge for businesses to understand and integrate 3D printing into their manufacturing processes effectively.

"I don't see the jewelry industry embracing 3d printing at all. I don't see the toy industry embracing 3d printing at all. Also for gadgets."

He notes the hesitation of certain industries to adopt 3D printing, despite its potential to revolutionize product manufacturing.

• Peter Weijmarshausen predicts a shift in product market dynamics due to 3D printing, with consumers gaining more influence over what products are made and sold.
• He believes that 3D printing will democratize the creation and distribution of products, moving away from corporate control.

"Well, what is going to happen is that as a result of this new technology, the way we think about how products go to market will completely change."

This quote reflects Peter's view that 3D printing technology will fundamentally alter the traditional pathways for products to reach consumers, empowering end users in the process.## Mass Manufacturing and Corporate Necessity

• Mass manufacturing is dependent on large corporations due to the need to produce and sell millions of identical products.
• Corporates conduct market research, design, testing, prototyping, and invest in large factories requiring significant capital.
• Mass advertising campaigns are used to convince customers to purchase these mass-produced products.

"Our society today is filled with big, big corporates and we need them for mass manufacturing because mass manufacturing needs, the word says it, to sell millions of products that are all the same to millions of customers."

This quote explains the traditional role of large corporations in mass manufacturing, highlighting the scale of production and uniformity of products necessary to meet consumer demand.

• A change in the manufacturing paradigm where selling a single unique product can be profitable challenges the need for large corporates.
• Individuals can bring products to market without the need for corporate infrastructure.
• This shift enables the production of millions of different products tailored to individual desires, bypassing the need for mass-market research and large capital investments.

"If however, you change the game that actually selling one product is enough, that actually by selling one product you can already make a small but still a reasonable margin, then all of a sudden it doesn't need to be a corporate that decides that this product can go to market, but it can be an individual because it can be the product that this individual wants."

The quote discusses a revolutionary approach to manufacturing where individuals can create and sell products tailored to their own needs or desires, disrupting the traditional corporate-dominated market.

• The choice to start with an incubator model was influenced by personal connections and the need for initial funding.
• Incubators provide resources for entrepreneurs with great ideas but may complicate ownership and control for the founders.
• Trust and fair treatment are crucial when dealing with corporate incubators, especially regarding the ownership of created products and companies.

"It was actually really simple. First and foremost, the person who first introduced me to this technology, my friend, was actually working as the CFO at the lifestyle incubator."

This quote highlights the personal connection that led to the choice of the incubator model, emphasizing the simplicity of the decision due to the need for funding and support.

• The incubator model may not suit all types of founders, particularly those looking for quick financial gains.
• Founders need to be comfortable with the potential of not having full control or ownership initially when working with a corporate incubator.
• Successful spin-out and fair deals with corporate incubators can lead to satisfaction for all parties involved, including early-stage investors and founders.

"But maybe if you are a type of founder that is setting up a business for a quick flip, just going after the money and not purely only the passion of the company, then that model definitely wouldn't work because you would be way too worried that the corporate would run away with your idea."

This quote emphasizes that the incubator model is best suited for founders driven by passion rather than those primarily seeking quick financial returns, due to the potential risks involved with corporate involvement.

• Fundraising was particularly challenging due to the economic climate and the novelty of the business model.
• European venture capitalists were not familiar with 3D printing technology, which made fundraising more difficult.
• A successful meeting with an informed investor led to a quick agreement and the spin-out of the company from the corporate incubator.

"I wasn't a social media company, I wasn't a game company. I didn't fit in any existing model."

This quote reflects the unique position of the company in the market, which did not align with the typical profiles venture capitalists were used to, creating an additional hurdle in the fundraising process.

• In retrospect, considering the fundraising process, it's unclear if any changes in approach would have made a significant difference.
• The success with informed investors suggests that finding the right investors who understand the technology and business model is more critical than altering the pitch.

"I don't know. I think I already described that. I was probably quite nuts t"

Although the quote is cut off and incomplete, it suggests a reflection on the fundraising process and possibly acknowledges the unorthodox nature of the approach taken.## Starting a Company and Fundraising Challenges

• Understanding your business model and market is crucial before seeking investment.
• Presenting a non-existent market as an opportunity is a hard sell to investors.
• European venture capitalists (VCs) tend to be more conservative than American VCs.
• American VCs may take risks due to abundant capital and previous big successes.
• Having a coach or mentor to help with pitching can be beneficial.

What creates so many red flags? Maybe when you start a company, you should think about what your business model is and make sure that you're not going to have to raise money and tell investors, potential investors, that there is really no market for your product, but that you're creating one.

The quote emphasizes the importance of having a clear business model and market understanding before approaching investors, as the absence of these can raise concerns and hinder fundraising efforts.

I think the hardest problem I had was unknown technology, non proven business model, non proven market size that was causing so many problems in convincing european feces.

Peter Weijmarshausen reflects on the challenges he faced when pitching to European VCs, including the difficulty of selling an unproven technology and business model.

European feces per definition are a little bit more conservative than american feces, who are known to in some cases just roll the dice because they a have so much money and b oftentimes have big, big successes in their funds already.

Peter Weijmarshausen contrasts European and American VCs, noting that American VCs may be more willing to gamble on high-risk ventures due to their financial resources and past successes.

• Leadership and self-deception is a book that focuses on personal behavior change to improve relationships.
• The book's unique approach is that it does not require both parties to read it to be effective.

Recently I read a book called leadership and self deception, and it talks about how you behave with regards to others and what you can change in your own behavior that makes relationships with other people much more easy.

Peter Weijmarshausen shares his recent reading experience, highlighting the book's theme of self-improvement and its impact on interpersonal relationships.

• Moving headquarters to New York provides access to a vibrant city, great people, and more investment capital.
• A significant downside is being far away from family and friends in Europe.

Biggest pro New York is a great city with a lot of great people and a lot of fun and access to even more investment capital than you will ever have in Europe.

Peter Weijmarshausen identifies the advantages of relocating to New York, including the city's attributes and financial opportunities.

Biggest con? Leaving your family and friends behind on another continent, which means you see them a heck of a lot less, which sometimes hurts.

Peter Weijmarshausen shares the personal cost of moving the company's headquarters to New York, which includes reduced contact with loved ones.

• Dependence on technology from larger companies is a challenge for smaller firms.
• Convincing big companies to adapt their technology and business models is tough without much leverage.

We're using technologies that others make. We're using the printers that big companies are providing. And I, as a small company, need to convince them that they need to change their technology, that they need to make those changes faster, and that they need to change their business models of high margin, low volume into low margin, high volume.

Peter Weijmarshausen discusses the difficulties faced by his 3D printing company, which relies on technology from larger companies and must persuade them to make changes that benefit smaller players like his own.

• New York Times space section and TechCrunch are go-to sources for staying informed about astronomy and technology.
• Peter Weijmarshausen has a physics background and retains interest in related fields.

I love to read the New York Times space. I love to keep up to date on what is happening in astronomy. I have a background in physics, so I still love that techrunch to keep up to date with technology.

Peter Weijmarshausen shares his favorite news sources, explaining how they cater to his interests in astronomy and technology, which are aligned with his academic background.

• Peter Weijmarshausen would choose to be the CEO of Ferrari for a day due to his passion for cars.

I love cars as well. I'd love to be the CEO of Ferrari for one day.

Peter Weijmarshausen expresses his enthusiasm for cars and his hypothetical interest in leading a prestigious car company like Ferrari, even if just for a day.

• Big changes are anticipated in the 3D printing industry with major players entering the market.
• Improvements in technology will enhance quality and delivery speed for customers.
• Digital manufacturing is expected to grow, leading to more people creating their products.
• Shapeways is projected to experience significant market and company growth.

Well, I think we're at the eve of a lot of big, big change and a lot of fun as a result of the big players like HP and Toshiba, et cetera, entering the market.

Peter Weijmarshausen predicts major shifts in the 3D printing industry due to the involvement of large corporations, which will drive technological advancements and market expansion.

I have a suspicion and a deep passion that this will actually lead to many, many more people embracing the use of digital manufacturing to make their own products.

Peter Weijmarshausen expresses his belief that the advancements in 3D printing will empower more individuals to engage in digital manufacturing, thereby growing the market and his company.

• Gratitude expressed towards individuals who facilitated the podcast interview.
• Promotion of personal blog, social media, and accounting software, Xero.
• Mention of Pearl Rear Vision, a wireless backup camera and alert system.

I want to say a huge thanks to Peter for giving up his time to be on the show, and so incredible to hear his journey with shapeways.

Harry Stebbings thanks Peter Weijmarshausen for participating in the podcast and sharing his experiences with Shapeways.

Now, as I said earlier, if you'd like to read more about my move to Atomico and the thought process behind all of that, then head over to mojitovc.com.

Harry Stebbings provides information on where listeners can learn more about his career moves and thoughts on venture capital.

Xero is beautiful, easy to use online accounting software for small businesses.

Harry Stebbings endorses Xero, highlighting its benefits for small business accounting.

Pearl Rear Vision is the only wireless backup camera and alert system that installs in minutes and updates throughout its lifetime.

Harry Stebbings promotes Pearl Rear Vision, emphasizing its ease of installation and continuous software updates.