Proto Labs Inc.'s CTO Breaks Down Its Business Model

In the following video, 3-D printing specialist Steve Heller interviews rapid manufacturer Proto Labs (NYSE: PRLB  ) Chief Technology Officer Rob Bodor about what the company specializes in and how its recent entry into the 3-D printing service space through its FineLine acquisition fits into the equation. With the FineLine acquisition now part of its offering, Proto Labs can effectively take a customer from the early stages of the product development process with 3-D printed conceptual models all the way to mid-volume manufacturing runs.

A transcript follows the video.

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Steve Heller: Hey Fools, Steve Heller here. I'm joined today with Dr. Rob Bodor. He is the Chief Technology Officer at Proto Labs. Thank you for being here, Rob. We really appreciate your time. I just want to get right into the questions here.

I really want you to break down a process. What does Proto Labs do, at a high level, and what are they so good at? I know that their slogan is "Real parts, real fast." How fast is it? How fast can you go from a conceptual model to a mid-sized volume manufacturing run?

Rob Bodor: We [Proto Labs] can go from a 3-D CAD file to first parts in as little as one day, and that's true across the majority of our manufacturing processes, in both metal and in plastic.

You asked about extending that to small- to mid-volume production. Normally customers, after we make the prototype, want to evaluate and functionally test those prototypes. Once they've done that, we can also do production in as little as one day, following.

Heller: Wow, so you [Proto Labs] can go from a 3-D printed prototype into production the next day, as long as all the approvals are made.

Bodor: Yes, from a 3-D CAD file to production in as little as one day, yes.

Heller: How many iterations does the typical 3-D printing customer -- I know you guys [Proto Labs] just recently acquired FineLine.

Bodor: Yes.

Heller: What does a typical iteration cycle look like, before you actually get to that production run?

Bodor: The FineLine acquisition is really exciting for us, because it lets us go really from concept, now all the way through to mid-volume production with our customers, end-to-end, and provide that level of service.

It also lets us be more consultative with them, because now we [Proto Labs] can offer them solutions in not just many different advanced manufacturing processes, but also in additive manufacturing, across many materials.

In terms of iterations we see a broad gamut, but customers use us [Proto Labs] a lot for iterating because we can turn things so fast, and take a lot of risk out of the process for them.

I'll give you an example. It's not uncommon for medical device companies to 3-D print concept prototypes with us and then, when they get to the point of wanting to make a mold, doing six to 10 different molds, simultaneously. What they're trying to do is -- they're betting on one finished product -- but this way they can take a lot of risk out, because they can try a bunch of designs simultaneously, pick the winner, and take that forward.

Heller: Right, and improve the lead time, so the time to market is much faster by playing that more diversified product approach.

Bodor: Exactly, because they can do that in parallel.


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