The founder’s paradox
3DP War Journal #94
In last week’s article about Nano Dimension selling its proprietary technology for next to nothing to Inspira Technologies, I didn’t mention one fairly important detail: Inspira’s CEO is Dagi Ben-Noon, who was a Nano Dimension co-founder and former COO of the company.
So after years, the technology is returning to the hands of the very people who originally created it.
(and who, in the meantime, left the company where it was developed and founded its original counterpart)
I have to admit that this story led me to some broader thoughts and reflections - specifically on how founders build AM companies, and then, as those companies grow and evolve, either drive them toward failure or hand them over to “experienced managers” who do it for them.
But before we go any further - an important clarification: this article is not about Nano Dimension, and certainly not about Mr. Ben-Noon, whom I do not know. These are general reflections on the broader issue of leadership in AM companies.
Secondly, despite the obvious temptation, I will not mention any other company names either. But the article is universal enough that you should have no trouble coming up with your own examples.
The pattern is always the same
A founder develops an AM technology. Sometimes it is unique in every possible way; sometimes it differs from existing solutions by just a parameter or a single distinctive feature - it doesn’t matter. What matters is that the solution gains recognition and traction.
To develop and commercialize the technology, the founder needs funding. They obtain it either from seed investment funds or through bootstrapping. At this stage, it still doesn’t matter, because everything is small, growing, and the founder maintains full control.
The founder establishes a company and hires people - mostly friends or referrals. The founder is not an HR specialist but an inventor, so obvious shortcuts are taken in this area.
A young team works intensely to develop an innovative product. The atmosphere is great. Early sales successes appear, along with industry recognition, perhaps even a startup award at a conference or event.
The company grows.
A real organizational structure begins to form. Departments emerge. There is an internal finance team, legal team, HR. It becomes a proper enterprise.
Naturally, more funding follows - grants, subsidies, or investment rounds. Or simply revenue from product sales. Contrary to popular belief, it does happen that an AM company is profitable.
The founder spends less and less time in R&D and more and more at the CEO’s desk - which they occupy.
This may or may not be satisfying. In any case, their professional life gradually changes - more responsibilities appear, not necessarily in areas they understand. They must make numerous decisions regarding sales, marketing, hiring, and overall communication.
They have never done this before. Mistakes happen - whether independently or by following advice from others who are equally inexperienced.
Eventually, the company reaches a point where its operational scale no longer allows it to be managed this way.
The founder must make one of two decisions:
abandon R&D and focus exclusively on running the business
hire an experienced manager who takes over operations while the founder returns to R&D.
There is also a third option where the founder sells the company and leaves, but let’s set that aside for now.
At this stage, the company faces four possible scenarios:
the founder focuses on management and succeeds
the founder focuses on management and fails
a new CEO takes over and succeeds
a new CEO takes over and fails.
The first scenario has only worked a handful of times - and usually involved the founder surrounding themselves with truly exceptional specialists who genuinely wanted to help rather than take control.
The second scenario is so common that it applies to the majority of startups. It can be considered the classic reason behind the failure of many young, promising AM companies.
The third scenario has also succeeded only a few times. The best example is a company that flourished under a general manager and fell apart after their departure.
The fourth scenario is also standard. Many large and well-known companies are now run by such professionals, but their future is far from bright. That doesn’t mean they will collapse - it means they will gradually stagnate.
From a simplified, mathematical perspective, a growing AM company has only a 50% chance of success (either the founder succeeds or not, or the external manager succeeds or not). In reality, historical data is far harsher - after leadership transitions, far fewer companies have succeeded than failed.
I won’t get into percentages - let’s just say “trust me on this,” and you’ll likely agree.
Why is that?
This brings us to the founder’s paradox in the AM sector. By nature, a founder is a maker, an inventor, an innovator, or a scientist – but not a businessperson. When a company reaches the stage where operational management becomes more important than technological development, the founder often lacks the skills to handle it.
Hiring an experienced external manager seems like the perfect solution - provided that the manager understands the specifics of the AM sector. Most simply do not. Not because they are incapable, but because truly successful executives rarely build their careers in AM.
I’ve described the brutal realities of the AM market in countless articles. Two of them are absolutely fundamental:
Typically, external managers, instead of respecting the rules of the AM market (including my three laws of the AM market), try to run the company against them by implementing solutions from other industries. This usually ends in failure.
In summary - a founder who wants to achieve market success with their technology must either be a natural talent in management or be lucky enough to bring in an outstanding general manager at a later stage of the company’s development.
Otherwise, failure is inevitable, regardless of how good the technology, products, or market visibility may be.
As I mentioned at the beginning, I’m convinced you can easily match this pattern to numerous companies, past and present.
Success in this industry ultimately comes down to two things:
you must live and breathe 3D printing every day
you must be an exceptional talent across multiple domains; technology alone is not enough, just as business alone is not enough; one does not work without the other.
Without these two conditions, failure is inevitable.