Tag Archives: money

On Makerbot And Being Open (Or Not)

A lot of smart people have wasted a lot of time wondering what open means. At least…in my opinion a lot of the discussion is wasted…because I don’t think it’s all that complicated.

It’s a simple matter of priorities. You are open if your top priority is being open. If your top priority is anything else, then you’re not open. You might be a big fan of open, you might even make it a high priority, but if it’s not your top priority then you are open in name only. You’re openwashing.

For example, a year ago the three founders of Makerbot all signed a statement that opened with this:

We make it open source so that you will have all the information about the machine. Our goal is be as open about the machine as possible! If you want to improve or hack the machine, you can do so…

Today, Bre Pettis was the lone voice who’s statement opened with this:

…we are going to be as open as we possibly can while building a sustainable business.

The old team perspective was:

The possibilities that we can’t imagine yet are one of the wonderful things that makes us stay up all night hacking on code, working on prototypes, and dealing with supply chain issues.

We’re not big fans of anything proprietary

We’ve been in the “eating ramen” stage of building a business this year because we want to get as many of these out there and grow the community…

We are doing this because we are dedicating our lives and our savings and our minds to the dream of bringing the tools of manufacturing to all.

The new Makerbot perspective is:

I’m looking forward to having conversations with folks at the Open Hardware Summit to talk about how MakerBot can share as much as possible, support it’s 150 employees with jobs, make awesome hardware, and be sustainable.

From a business perspective, we’ve been absurdly open, more open than any other business I know.

I don’t plan on letting the vulnerabilities of being open hardware destroy what we’ve created.

This isn’t the first change we’ve made to become more of a professional business, and it won’t be our last.

That’s absolutely a shift in top priorities and, to be fair, it makes perfect sense. Back before their $10M round of funding nobody knew if Makerbot would even be around in a year. But they are, and they’re doing more and better, and that’s all thanks to the money that was invested with them. Investment isn’t charity. Makerbot didn’t grow because the community gave them money in exchange for printers; Makerbot grew because they kept managing to convince professionals that they would be able to produce a significant return on seed capital.

It doesn’t really matter what their original priorities were, because the only way for them to be successful now is to focus on maximizing profit. You have to play the ball where it lies.

Yes, it is possible that they could be successful while remaining devoted to open, but it would be a hell of a gamble. There aren’t any relevant case-studies that I’m aware of; Makerbot is the first. New businesses, and new business models, are notoriously likely to fail. When you’re just a little guy plugging away at an idea, failure isn’t a big deal. When you’re using $10M of someone else’s money, failure becomes a real issue.

The thing is that I don’t see how anyone loses. Even if Makerbot goes totally closed source, and cuts off all the old printers, the community still benefits. Whether we like it or not the community suffers as long as 3D printing remains an unknown niche for a specific subset of geeks. There isn’t anything about the current state-of-the-art in open 3D printing that is inherently expensive or complicated. What is keeping it in a place where it costs too much and breaks too often is the lack of a market. Grow the market so that scale will bring prices down and quality up. That will help the open hobby community do more and more exciting things because there will be a bigger supply of commodities to work with.

And I don’t think Makerbot will go totally closed source. I think what they’re doing is moving up-market as fast as possible so that they can establish themselves as a brand that non-hackers buy. Believe it or not, but even most geeks get tired of wrenching on their projects and would appreciate it if they’d just freaking work for long enough to get something else done. There are an order of magnitude more people ready to buy a turn-key 3D printer than a turn-allen-wrench 3D printer. Those people are not being served by existing 3D printing companies. It would be fiscally foolish of Makerbot to ignore that market in favor of the tiny hacker market. But that doesn’t mean they will abandon open source designs. I think they will keep doing open source work, it will just slip into second or third place.

They need to pay their investors back, which means they need to establish a brand and cash flow that is lucrative. The open source hobby community is not lucrative. Of course it would be nice if they would be more up front about their shift in priorities, but I suppose using corporate double-speak is part of that shift.

Give it time. The open hardware movement is still very young and, unlike software, there is no way to ignore money. You can’t pay for hardware by eating cheap food and staying in front of your computer; you have to actually turn a profit. Even if Makerbot closes up like a clam, they will still have proven that a successful company can start open. Then the next hardware guys will try to stay open longer.

Also…if Makerbot goes closed source, they will just get out-innovated by the remaining open source hardware community anyway…just like the companies they’re trying to beat to the prosumer 3D printing market. The only way for them to stay relevant is to stay at least somewhat open.

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Kanyi Maqubela Interviewed Jessica Jackley of Kiva About Crowd Funding

Kanyi Maqubela of Collaborative Fund interviewed Kiva co-founder Jessica Jackley for The Atlantic (how’s that for maximum name-dropping in minimum space).

Read the article, or continue reading for some highlights.

Maqubela: It seems there will soon be platforms to raise money for almost anything, from the local bakery you hope to start in your neighborhood, to your high-technology startup idea, to donations for a church mission trip. What will such an economy look like? To answer that question, I spoke with with my colleague Jessica Jackley…

Jackley: Not all things can or should be crowdfunded…The ventures that keep things light and fun, easy to understand, that have a compelling story, a sexy retail product, will have an easier time getting people to rally around them and contribute. A start-up doing something that’s difficult to communicate or doesn’t offer any kind of retail product will have a tougher go at it.

Maqubela: This seems to line up with your Kiva philosophy: crowdfunding as a way of validating, or manifesting, an emotional connection to an individual or a narrative.

Jackley: Investors in big and in small deals tend to invest in people and in stories that resonate with them.

Maqubela: Kickstarter provided more than $150 million in funding to the arts in 2012, outpacing the National Endowment for the Arts (NEA), but is that a lot of money?

Jackley: One of the smartest things Kickstarter has done, in my opinion, is give people a great shopping experience related to the arts, that funds the arts. In essence, they’ve gotten people to pay $200 for a t-shirt plus the feeling of participation in another artist’s endeavor…Healthcare professionals don’t make art (in any traditional sense).

Maqubela: Endowing important projects requires sustained interest over time, and the Internet trends heavily towards short term thinking. I’m skeptical that crowdfunding could sustain longer-term projects…

Jackley: I wonder about that too.

Maqubela: But is the wisdom of the crowds really good?

Jackley: I see no problem with opening up more ways for entrepreneurs get capital — in general I think the more the merrier on this front — but again, we need to respect the place of crowdfunding in a very big market, and not try to make it more than it should be.

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Interview With Marco Perry of PENSA About The DIWire

Marco Perry is co-founder of PENSA, a New York consultancy that designs and improves products. It wouldn’t be too far off to say that innovation is his business. A short while ago Pensa designed, demonstrated and then open sourced an automatic wire forming printer. In case you aren’t familiar with it, here’s an overview:

The DIWire has attracted a lot of attention and Pensa is even planning on unveiling an improved version at the 2012 Maker Faire. Openalia sat down with Mr. Perry for a quick discussion of the DIWire specifically, and open source hardware in general.

Continue reading

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Crowd Funding Dump

Kickstarter has subdivided their “technology” category into “open software” and “open hardware” which makes my job a little faster. There aren’t very many things in it…but I suppose that also makes my job a little faster.

Summary:

Details after the jump.

Continue reading

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MaKey MaKey, Apparently Exactly What People Want

Crowdfunding is a reasonably popular way to launch, or maintain, an open hardware project. The best site for this approach is Kickstarter. Some projects get their funding, some don’t. What’s the difference between them?

That’s a hard question to answer. I haven’t studied the issue, but the most popular (IE: funded) projects seem to combine technology(s) in such a way as to create an “experience.” I’ve yet to see a better example of this phenomenon than the MaKey MaKey.

The creators asked for a mere $25K. What they got was $400K.

Printrbot asked for the same $25K and received over $800K, but that makes a lot of sense. It’s a 3D printer, so it can make things for you, and it’s remarkably small/cheap, so it’s superior to many other designs. However, for some reason, it’s a lot easier to find examples of people throwing money at things that aren’t nearly as practical. Printrbot got over 3,000% of its funding goal. Other projects that broke the 1,000% barrier are Remee (lucid dream mask), Twine (make your “things” send tweets), QuNeo (a colorful MIDI pad controller for musicians), TJ* (a robotic face puppet), Estylo (an eco-friendly iPad stylus), and ClockTHREE Jr (an amusing clock). There’s a lesson in here somewhere. I’m not entirely sure what it is, but at the moment it seems to be that people get excited about hardware projects (open or not) that create an exciting/novel/interesting experience.

So we’re back to the MaKey MaKey. It really doesn’t do much. What it does do is allow you to turn pretty much any arbitrary action and materials into a few simple inputs the computer can understand. You’re not going to get anything done with it, and the novelty will probably wear off in the 30 seconds it takes to lose playing Tetris on bananas, but that doesn’t matter. People want it.

Hardware projects (open or otherwise) depend on funding. You can’t build something physical with just pizza and a long weekend; eventually you’re going to need cash (or an incredibly well stocked junk yard). It helps if you don’t have to supply all the cash yourself. Apparently, if you want people to help out by purchasing/donating to your project, it’s a good idea to show them how the finished project will make them feel. The sort of people who build useful tools in their spare time also tend to be the sort of people who don’t market. That’s fine, but only a few other hard-core geeks are going to spontaneously understand why your project is awesome. Everyone else has to be shown. Some projects are made for the camera. They are pure experience. Other projects have to work at it.

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Open Source Ecology Turns The Corner

Exponential growth kind of looks like a hockey stick. When you pass the horizontal part and start to go vertical it’s called ‘turning the corner.’

Open Source Ecology started out as basically one ex-fusion-PHD on a farm. His experiences on the farm turned into a dream. That dream is turning the corner.

Read this blog post for an explanation.

I think Marcin said it’s been about seven years since he started working on developing his vision for OSE. Now he’s actually got enough money and support to build a structure capable of open sourcing the entire industrial and agricultural infrastructure the world depends on. There’s a long way to go, no doubt about it, but things seem to be on the right track. I particularly like that he is moving away from the “ask people for money” paradigm so OSE can focus on the “earn money” paradigm.

If open source hardware is going to prove itself then it’s going to be in the marketplace. The most successful open source projects, things like Linux and Arduino and Makerbot, are all successful specifically because they can pay their own way forwards.

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