MT Magazine March/April 2023

MARCH/APRIL 2023

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in 2022 with significant lockdowns and labor shortages. Looking at the 3D printing investment landscape, just three companies received $379 million in venture capital funding for 3D printed dental applications such as customized clear aligners. Another $79 million went to a company developing laser powder bed fusion 3D printers intent on serving aerospace, marine, and automotive customers. These four transactions alone pushed the total investment in Chinese 3D printing companies six times higher in 2022 than in 2021. Around the world, significant late stage investments such as these may become more frequent as global supply chains search for ways to become more resilient through additive manufacturing’s flexibility. In October, the Chinese government released an updated list of approved sectors for foreign investment, including 39 new sectors with a heavy focus on advanced manufacturing. At the same time, the U.S. government has made significant commitments to invest in critical manufacturing and technology areas. The next few years will undoubtedly include more outsized investments in core technology developers, service providers, and applications. Combining a strong investment year and a view toward mitigating supply chain uncertainty will undoubtedly accelerate the technology’s development and further adoption in domestic markets. With investor interest shifting to applications as a notable complement to core technology companies, advanced manufacturing may more efficiently find product-market fit and ultimately find more paths to deliver on its promises. This article was written by Dayton Horvath with analysis and contributions from Mark Huber and Camren Sonneveldt. For questions or comments, please email dhorvath@AMTonline.org.

large minority investments are not uncommon, the applications category received 3.3 times more investment than in 2021, becoming the second-largest category, after core, in 2022, with 21 transactions. Such a strong showing for applications across dental, medical, aerospace, consumer, and automotive suggests that investors are finally looking toward specialization and focused product-market fit opportunities. Hardware manufacturers have increasingly reflected this in product offerings that target specific applications, a subtle change to the industry standard, where one printer model serves all applications in a size range. Investments into core technologies and services remains as high as ever with 38 transactions and a continued focus on better, faster, and/or less expensive additive manufacturing hardware. Average investment size increased to a new high of $26.9 million for 2022, (see infographic on page 18), up nearly 40% due in part to large investments into a small number of companies, including Vulcan Forms, Divergent, Fictiv, Prismlab, and Sprintray. The larger average additionally indicates an increased number of later-stage funding rounds relative to past years. While this is a positive sign for companies with significant market traction already, the middle funding tiers continue to be underserved by investors, creating tighter conditions for companies looking to scale up proven technologies. Investments by Region The COVID-19 pandemic’s lingering effects continue to be observed in global supply chains, slowing the flow of materials and goods across industries throughout 2022. Disrupted supply chains trigger hesitation and uncertainty among investors already looking to recessionary concerns on the horizon. Investors looking or needing to act are considering high-growth industries such as advanced manufacturing, which serve as a hedge against supply chain uncertainty. Geopolitical tensions add to the uncertainty of deploying capital in long-term international opportunities, pushing some investors with dry powder toward startup opportunities closer to home. This effect was amplified in China, where “zero-COVID” policies continued