Here comes consumer hardware?

Contact: Ben Kolada

MakerBot Industries recently turned about $11m in funding into a potential $604m sale ($403m in stock upfront, with $201m in earnout potential). Just as the company transforms its newfound parent Stratasys’ market potential, moving the commercial 3-D printer manufacturer into the consumer market, the MakerBot sale may also help transform the greater technology industry, and bring consumer hardware back into favor.

We’ve written before about the emergence of consumer hardware in the form of wearable technology. As we noted then, the majority of companies tackling this nascent market are large multinational corporations such as Nike, Apple and Google.

That could soon change. VCs often lament that hardware is too capital intensive and can quickly get commoditized. But MakerBot’s growth and exit valuation certainly don’t reflect those concerns.

After only a few years in business, and having taken in roughly $11m in funding, MakerBot was able to grow total revenue to $15.7m last year. The company was set to smash that this year – in just the first quarter, it recorded $11.5m in sales.

Meanwhile, some VCs have complained recently that consumer software startups have become too stale, and the market too fad-driven. (Of course, some of that griping may be coming from VCs that missed out on the $1bn exits of consumer-focused startups Tumblr and Waze in the past month.) Nonetheless, MakerBot’s gold-plated exit may help some of the venture shops broaden their investment areas.

MakerBot’s funding history

Year – Amount – Investors
2009 – $75,000 – Individual investors
2010 – $1.2m – 500 Startups, Angel Investors, Bezos Expeditions, Founder Collective, High Line Venture Partners, Lerer Ventures, Thrive Capital, True Ventures
2011 – $10m – Angel investors, Bezos Expeditions, Foundry Group, RRE Ventures, True Ventures

Source: The 451 M&A KnowledgeBase

For more real-time information on tech M&A, follow us on Twitter @451TechMnA.