The latest sign of maturation in the industrial 3D printing sector is a major new venture capital fund. The €100 million fund is the first of its kind dedicated to additive manufacturing (AM) and has emerged with its initial closing today.
AM Ventures portfolio company Additive Drives creates highly efficient 3D printed copper windings ... [+]
While the fund itself is new, it’s been a long road for the entities behind it to get to this point. AM Ventures’ Chief Venture Officer Arno Held and Investment Manager Adrian Maier-Ring shared insights into the vision of the venture capital forces that have come together to create the fund.
Focused AM Investment
Technology, expertise, culture: many aspects of each company come into play when AM Ventures is scouting the next success story. “It’s not just money in, and then pressure and reporting in,” Maier-Ring said: “It’s working together, supporting one another, introducing people, and working on technology levels.”
Dr. Hans Langer stands at the forefront of the AM industry.
The idea for AM Ventures was born back in 2014. It grew out of 3D printer manufacturer EOS, and is part of the greater LANGER Group that stands behind EOS Group and SCANLAB Group, all founded three decades ago by Dr. Hans Langer. “We went live with AM Ventures in January 2015, with two people in one office,” Held recalled. “We started looking at startups around the planet, and were surprised with how many there were, many hundreds already.”
AM Ventures sought to scout, discover, invest in, and foster the growth of 3D printing startups. “Our big statement when we founded the company was that EOS’ job was to grow their slice of the pie; we wanted to grow the whole pie of additive manufacturing with great, disruptive, revolutionary startups,” Held said.
To date, the company has invested in 15 startups based in six countries on three continents in more than two dozen funding rounds. Among these companies is DyeMansion, which “created and is dominating its own technological segment,” Held said, referring to the company’s innovative finishing technologies. On the software side is 3YOURMIND, while US-based LightForce Orthodontics is also a standout “for a small German investor,” as Maier-Ring noted. Investments into industrial 3D printing have continued throughout the pandemic over the last year, and AM Ventures has been at the forefront of many notable funding rounds.
The total focus on this technology suite has led AM Ventures to its unique footing. “We focus on a niche market, on a niche technology, with extensive expertise and a vast network in the background. There are no other AM Ventures out there,” Maier-Ring said. Beyond investment, AM Ventures brings together expertise in what they call their extended “fAMily” — “with a capital ‘AM’,” Maier-Ring was sure to note — and all gathering together in the mountains each (non-pandemic) year.
€100 Million 3D Printing Venture Capital Fund
With the success of AM Ventures’ current portfolio, it’s been clear that investment into industrial 3D printing is a strong business opportunity. Together with LANGER Group, AM Ventures has now joined up with leading European independent investment and asset management company KGAL to form the new fund. As of today, the initial closing brings the fund close to 50% of the targeted commitment. “Besides the LANGER GROUP, KGAL and its shareholders,” the announcement notes, “multiple high net-worth individuals and experienced entrepreneurs have joined the fund as limited partners.”
Managing Partners Arno Held (L) and Johann Oberhofer.
The expertise of the parties joining together paints a pretty picture of a strengthening support system for seed- and early-stage industrial 3D printing companies. KGAL, which alone has an investment volume of €15B and more than 390 funds launched over its 53-year history, brings significant expertise in financial resources. The newly formed AM Ventures Management GmbH will see leadership from the LANGER Group, Managing Partners Johann Oberhofer and Arno Held, and shareholder KGAL.
Dr. Klaus Wolf, Chief Investment Officer at KGAL
“AM Ventures, through their shareholder base, bring in-depth knowledge of industrial 3D printing thanks to their long commercial presence in this field; KGAL in turn has a proven track record in access to investors,” Dr. Klaus Wolf, Chief Investment Officer at KGAL, said in the announcement. “Through this joint venture we are laying the foundations for a long-term partnership and for further funds in a strong growth market.”
“With this fund, we can build a portfolio of 20 to 25 early-stage startups adding value to this industry,” Held noted in our conversation. While work toward the fund began in 2019, the massive disruptions following the emergence of the novel coronavirus “set us back almost to zero.” The process took rather longer than anticipated with the teams also working remotely but, Held continued, “We have finally made it and we are very proud to join forces with a very experienced assets manager who brings a lot of know-how around the regulatory side in setting up a fund.”
The Next Stages Of Industrial 3D Printing
DyeMansion post-processing equipment is loaded with 3D printed parts.
“The plan going forward is pretty simple,” Held said: “We are continuing the work we have done so far with the same focus on early-stage startups in hardware, software, materials, and applications. This is everywhere on this planet, everywhere there is an AM startup we want to be with not only our funds, but with our network of great experts we have set up.”
During the initial fund work in 2019, AM Ventures scouted about 200 startups. In pandemic-stricken 2020, scouting not only continued but accelerated, with 227 new companies examined. This, Held added, is “quite a big statement for AM.” He pointed to the reshaping currently happening in additive manufacturing, with several companies going public and many more partaking in merger and acquisition activity. “We can provide a lot of support and help stabilize startups, help to make sure they grow into mature high-tech and deep-tech companies,” he said. Anticipating that the growth trend continues with another 10% increase, the AM Ventures team expects to scout more than 250 new industrial 3D printing startups in 2021.
As the team has gained experience in scouting and spotting prize prospects, they have also noted some intriguing trends indicative of industry growth. While the North American and European markets remain the largest in AM, “the quantity and quality of startups in the APAC region is rising,” Maier-Ring observed. Further, he added, while around 40-50% of startups have been focusing on hardware, “the trend seems to be more going into applications, which is very interesting for us and for the industry.”
Awareness of those trends and expertise rooted deeply in the technology of AM gives AM Ventures a strong foothold in targeted investment. Whereas “other VC funds normally spread their risk across many different verticals or industries,” Held noted, “they are often lacking the deep core know-how of early-stage companies. We know everything about this technology, about this industry, and about the startups that are being born and that are fading away. We know exactly where the startups are founded, how and when they are being funded. We know categories and business models being applied and which are becoming successful.”
Final closing of the full €100M is anticipated for spring 2022. “Perhaps the work will continue even with more than one fund in the future, to grow additive manufacturing on the global scale,” Held said.
