Xometry Growth Continues With New Customers, Funding, And Optimism

At SOLIDWORKS World 2017 we got introduced to Xometry, a company committed to bringing manufacturing back to the U.S. with its software platform for building a reliable and scalable manufacturing source program. It employs a unique machine-learning approach that provides customers with optimized manufacturing capabilities at the best price based on parameters input by customers.

Founded in 2014, Xometry is hoping to transform American manufacturing through its proprietary software platform that provides on-demand manufacturing to a diverse customer base that ranges from startups to Fortune 100 companies. The platform provides an efficient way to source high-quality custom parts, with 24/7 access to instant quote pricing, expected lead time, and manufacturability feedback that recommends best processes and practices. With more than 100 manufacturing partners, the manufacturing capabilities include CNC machining, 3D printing, sheet metal forming and fabrication, and urethane casting with over 200 materials. Xometry’s 5,000+ customers include General Electric, MIT Lincoln Laboratory, NASA, and the United States Army.

Below is a video interview we conducted at SOLIDWORKS World 2017 with Randy Altschuler, CEO and co-founder of Xometry.

Randy Altschuler, CEO, Xometry at SOLIDWORKS World 2017

Xometry acts as the orchestrator, enabling engineers and designers to connect with manufacturers who can produce quality parts. Previously, the supply chain was fragmented, with manufacturers and customers mismatched on capabilities and needs. Now ordering custom parts can be accomplished by uploading a 3D file and placing an order. Xometry, much like ride-sharing apps, will then connect customers to manufacturers with available capacity around the country.

Manufacturing partners can join the network at no cost and there is no bidding for jobs. Facilities receive notifications about orders that fit their specific capabilities and they can choose to accept jobs based on their capabilities.

Xometry’s technology platform enables it to leverage the expertise and capacity of the almost 200,000 manufacturers across the United States with less than 20 employees.

CNC Machining and How Xometry Is Different

According to Altschuler, “There is an alleged decline of manufacturing, the rise of foreign markets, and the end of American innovation. But the state of American manufacturing is a lot more complicated than these allegations would have you believe. Yes, there have been lost jobs, but there have also been seismic technological shifts that in some ways are making the domestic manufacturing sector more powerful than ever. With new advances in 3D printing and CNC machining, the modern machine shop has never had more tools at its disposal that allow it to adapt its offerings to any project, large or small.”

“Xometry allows companies to upload 3D CAD files that are then instantly priced and matched with the shops best prepared to complete the jobs. With our platform for on-demand manufacturing, we can substantially compress the time from design to manufacture, all while delivering a better experience for both sides,” he said.

The video below illustrates Xometry’s quote capability.

Xometry’s Instant Quote Capability

Xometry employs strict quality control to ensure it’s only offering up the best vendors. When a manufacturer initially signs up to join the network, Xometry screens the company by giving it only one job to complete. Instead of shipping the product directly to the customer, it’s first sent to Xometry; where their team assesses the quality of the product and whether it meets standards established by the customer and Xometry. Customers are also encouraged to rate their vendors based on their performance, and any manufacturers flagged for producing poor-quality products will receive additional scrutiny from Xometry.

Xometry Finds Fewer Small Shops Anticipating Growth

In May 2017, Xometry released the findings of its quarterly Small Manufacturing Index (SMI), showing less year-over-year and month-over-month growth optimism for small to mid-size manufacturers.

In April, 43% of surveyed manufacturers reported that they were likely to see strong to mild year-over-year growth, compared to 61% of those surveyed in January. 42% of surveyed manufacturers in April reported that they were likely to see strong to mild month-over-month growth, compared to 57% in January. However, a subset of manufacturers that use online manufacturing platforms indicated an increase in expected year-over-year growth, with 65% expecting to see growth this quarter compared to the same time last year – a 4% improvement from last quarter’s survey.

The quarterly index, which takes the pulse of small to mid-size manufacturing shops, asked manufacturers both inside and outside Xometry’s partner network whether they expected to see growth in business compared to previous months and prior years. It also asked what they anticipate being their growth sectors. These small to mid-size manufacturers represent more than 190,000 companies, over a $50 billion market.

“Xometry has designed the SMI to gauge changes in demand expectations in the low-volume manufacturing industry nationwide,” said Laurence Zuriff, Xometry co-founder and CFO. “The sector is highly fragmented and regionalized, as a result it can be challenging for business owners to get a sense of the health of the sector as a whole. We’re pleased to offer these small shops a consistent way to assess the market in which they participate.”

Funds To Grow

This week Xometry announced $15 million in funding led by BMW i Ventures, with participation from existing investors including GE Ventures and Highland Capital Partners. The company said that the latest round of funding will accelerate Xometry’s investment in its machine learning-based software platform, manufacturing partner network, and sales organization.

“We’re thrilled to partner with BMW i Ventures and deepen our relationship with General Electric,” said Altschuler. “We’re accelerating our efforts to provide additional features to our online platform, making it easier for engineers and procurement managers to conveniently order a wide range of parts delivered by our expanding network of hundreds of manufacturers across the nation.”

Xometry has now raised a total to date of $38 million.

Xometry has continued its rapid market expansion, recently eclipsing 5,000 customers spanning multiple verticals, including aerospace, automotive, consumer, medical devices and industrials. This year, Xometry has already tripled its 2016 bookings during the same time-period a year ago. Xometry has correspondingly expanded its manufacturing capacity by more than five times since the end of last year.

Leading global manufacturers, such as GE, BMW and others, are leveraging Xometry’s platform to simplify the purchase of custom manufactured parts and to enable efficient price transparency in their procurement practices.

“We’re thrilled to continue to expand our relationship with Xometry. Its easy-to-use interface is being deployed across GE business units to deliver high quality parts to a number of industries,” said Ralph Taylor-Smith, Managing Director of Advanced Manufacturing, of GE Ventures.

The infusion of capital will allow Xometry to accelerate investment in its software platform powering its manufacturing partner network. “We created a marketplace by creating price clarity where none existed,” said Altschuler. “We thought if you can buy groceries and order a car off the internet, then why not custom parts? We can now accelerate our investment to meet more of our customers’ needs.”

While Xometry is not the first company to explore the possibilities of on-demand manufacturing, we are impressed with the company’s approach, growing partner network and customer base, relationship with SOLIDWORKS, and the investment community. The company seems increasingly well-positioned for continued growth and success.

Tags: BMW i Ventures, contract manufacturing, GE Ventures, Highland Capital Partners, small manufacturing index, SMI, Xometry

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