Stratasys Ltd. is now officially based in Israel, but it is quickly expanding its original home in Eden Prairie to keep up with rising demand for 3-D printers.
So far this year, the company has added 126 jobs in the Minneapolis suburb, a 33 percent jump to just over 500 people. And it expects to hire another 30 to 40 people before the end of the year, Scott Crump, chairman and co-founder of Stratasys, said in an interview.
“We’ve got openings in IT, engineering, sales, manufacturing, marketing, administrative, customer service and finance,” Crump said.
The company has been one of the hottest stocks in Minnesota this year after two recent acquisitions positioned it with a leading share of the fast-growing market for 3-D printers. Stratasys has delivered total returns to shareholders (including dividends) of 63.8 percent in the past 12 months. That compares with 39 percent for the Star Tribune 100 index of Minnesota companies and 20.5 percent for the Russell 1000 index.
3-D printers originally were used by the industrial companies that have long formed a customer base for Stratasys. But as with other digital technologies, 3-D printing gradually has come down in cost, improved in quality and moved into the consumer market.
With such printers, people who design an object in a 3-D computer program can actually make it. The printer sprays plastic material that adheres to take the shape of the object that a designer or engineer has created.
“The adoption of 3-D printing by big and small companies is up significantly,” Crump said.
The merger Stratasys completed earlier this year with Objet Ltd., based in Rehovot, Israel, is making it easier to get orders from Fortune 100 and Fortune 1000 companies that want to do business with a market leader, Crump said.
“It’s comforting to larger customers to be dealing with a vendor that is a partner, not with what may be a fly-by-night start-up,” said Bobby Burleson, an analyst at Canaccord Genuity in San Francisco.
“There’s huge change taking place in the way manufacturing is being done, and there’s a lot more pressure on companies to have a 3-D printing strategy,” he said. “If a part is needed in low volumes, a company may just manufacture it with 3-D printing instead of conventional methods. Or a company may use 3-D printing to make the machine tooling used in manufacturing to save on cost.”
Stratasys’ Eden Prairie operation is the largest source of the company’s products, having produced about 80 percent of its installed base of approximately 30,000 3-D printers. The size of the installed base is important because Stratasys receives a continuing revenue stream by resupplying customers with the plastic material the printers spray to make 3-D objects.
Even as the Objet merger resulted in the relocation of the headquarters and other changes to the company’s structure, Crump said the Eden Prairie operation remains central to its operations.
“We handle the output from computer-aided-design machines, so we do a lot of work in software, firmware, resins and plastics,” Crump said.
He said no work will be moved from Minnesota to Israel, in part because the products made by Objet have different underlying technology than those made by the pre-merger Stratasys. Objet uses so-called Polyjet technology that’s designed for firms that want to make early product prototypes using higher-cost plastic materials. Stratasys products use fused deposition modeling (FDM) to make objects that are closer to finished goods rather than prototypes.
Crump said Eden Prairie also might benefit from the company’s more recent acquisition of MakerBot, a New York-based maker of low-end consumer and small business 3-D printers. Stratasys might be able to persuade some of the 20,000 purchasers of MakerBot’s entry-level 3-D printers to buy up to the industrial-level products made in Minnesota. Stratasys 3-D printers cost from $10,000 to $600,000, while MakerBot printers cost $2,000 to $3,000.
Eden Prairie employment could get another boost from the recently announced plan by United Parcel Service to deploy Stratasys 3-D printers at some of its stores, allowing customers to “make” things from computer designs. The printer UPS is using will be made in Eden Prairie.