The State of Investing: Manufacturing Startups Face a New Investment Reality
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The investment thesis at venture capital firm Ninepointfive is grounded in the view that Europes manufacturing sector remains stubbornly analog compared with industries like telecoms and healthcare. As founding partner, Paul van Emmerick, puts it, There is still a large chunk of the way [manufacturers] operate which didnt embrace technology as other industries have. He points in particular to the Mittelstand or SMEs in Germany, where many companies rely on outdated sales methods and slow qualification processes. You have sales guys driving around in cars and going for a chat, you have complex qualification and tender processes. He believes that online platforms and digital networks can unlock efficiencies across the supply chain, contributing to the firms stated mission of making Europes traditional industries more digital and green.The Covid-19 pandemic added urgency. Disruptions, exemplified by the Suez Canal blockage, forced firms to rethink their supply chains. The world realized that were relatively vulnerable, van Emmerick notes. A more digital manufacturing sector promises supply chain resilience by providing faster sourcing and flexible capacity. To that end, Ninepointfive backs platforms able to short-circuit complex workflows and streamline procurement, thus mitigating vulnerabilities that came to the fore in recent years.The current investment climate in Europes technology landscape, particularly as it relates to manufacturing digitization, has evolved. Dry powder sits ready to be deployed, but investors increasingly demand robust operating models. Before, maybe you needed to tick seven out of ten boxes. Now you need to be nine plus, van Emmerick says. Ninepointfive examines both the quality of an idea on paper but also how it fares under actual market conditions. They look for early customer traction and stickiness in repeat orders. This is one reason the firm points to portfolio companies such as MakerVerse, where a strong record of recurring orders provides evidence that the platform meets genuine manufacturing needs.Paul van Emmerick. Photo via Ninepointfive.Read more in this series:The State of Investment in 3D Printing IndustryNATO Innovation Fund and defense tech investingAM Ventures: how to get your 3D printing start-up fundedWill additive transform everything?The founding partner sees fewer outsiders entering industrial markets without prior experience. Instead, deals increasingly originate from collaborations with established corporates with well-developed ideas but neither the right teams nor the internal structure to bring them to market.This approach narrows the range of prospective investments and reduces time spent on pitch sessions or scouting at large-scale events. Instead, Ninepointfive looks to corporate partners that have identified gaps or inefficiencies in their own operations. The firm then channels its funding and expertise into start-ups that can quickly demonstrate product-market fit.Van Emmerick acknowledges that additive technologies alone seldom provide a panacea. Rather, lasting success depends on integration into broader manufacturing workflows. Despite the high expectations once surrounding 3D printing, the technologys true impact emerges only when paired with other production methods. After the hype disappeared and valuations tumbled, the question became: what will it actually deliver? Will additive transform everything? he says. In his view, the answer lies in combining additive techniques with established processes rather than focusing solely on niche applications.Beyond the technology and business model, Ninepointfive also closely examines founding teams. The firm conducts structured interviews to identify resilience, ambition, and the ability to navigate fast-moving environments. You have to manage more stakeholders at a much faster pace than in a traditional setting, van Emmerick explains. This requirement rules out specialists who might excel in one area but struggle when confronted with the diverse pressures of early-stage company-building. Instead, the emphasis is on leadership capable of inspiring employees, engaging customers, and gaining the trust of partners across the supply chain.Mixing AI and AM where are the underinvested opportunities?Ninepointfives approach to additive manufacturing invests not only in hardware and materials but also in the software and intelligence that accelerate adoption. They use AI from day one, says the founding partner, describing how platforms in their portfolio integrate advanced models into their workflows. MakerVerse, for example, deploys stochastical mathematical algorithms to refine automated quoting and employs language models to interpret customer emails, extracting requirements and proposing only the most relevant queries. By removing the need for weeks of back-and-forth negotiations, iteration becomes a nimble process.This emphasis on integration is seen as central to unlocking the full potential of additive manufacturing. The technology, in van Emmericks view, rarely stands alone. Instead, it sits alongside CNC machining and other conventional processes, as well as AI-driven decision-making tools. He believes that digital platforms are forging a manufacturing network that behaves like an extension of your own organization, freeing prototyping and innovation managers to iterate faster without the friction associated with traditional procurement methods.Ninepointfive currently holds nine companies in its initial fund, launched four years ago, and while the time frame has been too short to test exit conditions, the firms focus remains on under-digitised industries. Van Emmerick sees promise in sectors such as offshore and maritime, where technology uptake has been slow. The second fund aims to identify similar opportunities where industrial processes lag behind other sectors, providing a chance to accelerate digitization and increase efficiency.2025 investment approachInvestors such as Ninepointfive see 2025 as an opportune time to deploy capital, even if economic headwinds have cooled sentiment compared with past years. In our second fund, I am definitely on the lookout to invest, says van Emmerick, noting that undervalued companies and realistic valuations are resetting the market. He anticipates greater mergers and acquisitions activity, as well as the potential for successful IPOs, which could spur further upstream investment.Such conditions, however, do not mean that investors will ease their standards. Even with the market offering fertile ground, entrepreneurs need more than a compelling narrative. Red flags, such as overreliance on a single customer or a (perceived) lack of meaningful competition, quickly undermine a founders credibility. Early traction and realistic assessments of the competitive landscape carry greater weight than ambitious projections unsupported by evidence.The shift towards quality rather than quantity has prompted some firms to broaden their lens, looking beyond headline-grabbing technologies to identify hidden inefficiencies in traditional sectors. While additive manufacturing and AI remain integral components of Ninepointfives strategy, the firms next fund may target slow-moving verticals like offshore and port logistics. Against this backdrop, startups hoping to secure funding must demonstrate that their innovations align with tangible market needs and can meet the scrutiny of increasingly discriminating investors.Dont miss the upcoming articles in our State of Investing in 3D Printing series; subscribe to the 3D Printing Industry newsletter.To stay up to date with the latest 3D printing news, follow 3D Printing Industry on LinkedIn.You can also find us on Twitter, and Facebook.Featured image shows a 3D printed lampshade at Materialise HQ in Belgium. Photo by Michael Petch.Michael PetchMichael Petch is the editor-in-chief at 3DPI and the author of several books on 3D printing. He is a regular keynote speaker at technology conferences where he has delivered presentations such as 3D printing with graphene and ceramics and the use of technology to enhance food security. Michael is most interested in the science behind emerging technology and the accompanying economic and social implications.
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