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How the 3D printing SPAC bubble burst in 2022

Nozzle4 · · 2 min read

Between 2020 and 2021 a queue of 3D printing companies went public through SPACs, the blank-cheque vehicles that let a firm skip the scrutiny of a normal IPO. Desktop Metal, Markforged, Velo3D, Shapeways, Fathom and Fast Radius all took that route, most of them at valuations that assumed years of flawless growth. 2022 is the year those assumptions met a rising interest rate.

When cheap money ended, unprofitable growth names were repriced hard across the whole market, and 3D printing sat right in the blast radius. The SPAC cohort lost most of its value over the year. The clearest single data point is Fast Radius: it went public via SPAC, filed for bankruptcy less than a year later, and was sold in December 2022 for 15.9 million dollars, somewhere around one percent of its peak valuation.

The survivors were burning cash at a rate that only made sense in the old regime. Desktop Metal reported a non-GAAP operating loss of 30.7 million dollars in the second quarter alone. Markforged watched its losses climb 122 percent to 23.8 million. These were not small companies having a bad quarter; they were public companies whose business models had been sized for capital that no longer existed.

While the SPAC names bled, the older incumbents spent 2022 rearranging the board. Stratasys folded its MakerBot consumer arm into Ultimaker, closing the merger on 31 August; the combined desktop business left Stratasys holding 46.5 percent and NPM Capital 53.5 percent, which was Stratasys quietly getting out of the low-margin consumer game.

The move that actually mattered for the next two years was quieter still. Nano Dimension, sitting on a large cash pile from earlier fundraising, built a stake of about 12 percent in Stratasys. Stratasys read the intent correctly and adopted a poison pill on 4 August 2022 to stop Nano taking control on the cheap. Neither company said the word takeover out loud yet, but the pieces were now on the board.

So 2022 was two stories running at once. The SPAC class of 2021 discovered that going public early does not create a business, it just exposes the lack of one to a live share price. And the established players, cash still in hand, started circling each other. The wreckage of the first story became the raw material for the second: the same distressed names that cratered in 2022 are the ones that got bought, cheaply and messily, in the consolidation that followed.

What that circling turned into is the 2023 takeover war, where Nano Dimension, Stratasys, 3D Systems and Desktop Metal spent a year trying to buy each other and closed nothing. Current prices for the names still standing are on our stocks page, and the SPAC scoreboard puts each of these deals’ announced valuation next to the price the company later sold for.

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