In the following video, 3-D printing specialist Steve Heller interviews Mcor Technologies about the company's latest 3-D printing developments. Based in Ireland, Mcor makes professional full-color and monochrome 3-D printers that use ordinary copy paper as its primary material. Consequently, Mcor's printers cost between five and 30 times less than competitors.
Topics covered include:
- Mcor's strategic vision
- When Mcor's products become the cheaper alternative over Stratasys' (NASDAQ:SSYS) MakerBot
- Mcors latest 3-D printing developments
- Why Mcor has an easy time converting 3D Systems (NYSE:DDD) and Stratasys customers.
A full transcript follows the video.
Steve Heller: Hey Fools, Steve Heller here. I'm joined today with Conor MacCormack of Mcor Technologies; he's the CEO. Thank you so much for being here, Conor.
Conor MacCormack: Steve, my pleasure.
Heller: I wanted to get started, just for our readers out there, Mcor technologies uses paper to 3-D print objects. What's interesting about that is the running costs and operating costs are significantly less than competitors; anywhere between 5 and 30 times, is that right?
MacCormack: That's correct.
Heller: I wanted to lay out -- since you're not publicly traded, there's not much information on you out there. What is your company's vision, in the context of the landscape which is rapidly evolving right now?
MacCormack: We have a very bold vision for a relatively small company up against these big Goliaths! We believe that we can become the market leader, providing full-color, professional and eco-friendly 3-D printers.
Those three things -- full color, professional, and eco-friendly -- really drive the innovation, drove this product to market, but all the new things we have coming down the line are all geared around those three philosophies. That's what really keeps us apart from everybody else.
Heller: Every product you're bringing to market, you're always thinking about the way you can make it the cheapest for the customer, at the end of the day.
MacCormack: Yes. For us, very simply, we had this idea, could we build a machine that had zero running costs? -- which is really against the grain from everybody else -- but we felt that was the real Achilles' heel of the industry. Always, we're always trying to make things very, very low-cost; the most accessible 3-D printer on the market. That drives everything.
Heller: Could you explain how it works? You basically just use regular copy paper, that you can buy at a Staples or a Costco, or wherever. You can put three reams into your IRIS, is that correct?
Heller: About 1,500 sheets, and that's cut down into a 3-D printed object that looks like this, in full color.
MacCormack: Yes, it will take any standard office paper, and that is the big selling point of this technology, is that you can use regular office paper. You can even steal some paper out of a photocopier or a printer in your office.
But the basic idea, the unique selling point, is that customers are able to put their own material into the machine, and that's a big difference.
Heller: Right. You're not locking them in with some expensive proprietary material like some of your competitors.
MacCormack: Yes. There is an adhesive, and there's an ink component to our machine, so people might say, "Yeah, but you still have to buy that from us." That is true, but the biggest part of the building material is the paper. They supply that themselves, and even when you factor in the ink from Mcor and the adhesive from Mcor, we're still 5-30 times cheaper than everybody else, so it's still a very, very good proposition.
Heller: Very good, very disruptive.
I want to talk about the market where you're best positioned, which I believe is conceptual models and early prototypes. In that market, a lot of consumer printers -- say, the MakerBot printers, MakerBot Replicator -- if I'm a design firm, and let's say I have 20 engineers, why would I choose ... your Mcor IRIS runs about $50,000 or so, is that right?
MacCormack: A little less, yes -- $45,000.
Heller: ... versus buying a fleet of MakerBots for my engineers. What is the selling point for using your product for an early prototype, a conceptual model, versus MakerBot?
MacCormack: The way I view it is very simple. 3-D printers are like a tool in a toolbox. There are going to be circumstances where people don't need to have color, they don't need to have the really, really low cost, they're not concerned about the green. If that's the case, they might want to go over to -- and they do -- some go over to other technologies.
But really, when you add color, color is a big differentiator. That is the biggest driving force why people are buying our printer over anybody else's. You can take a simple product, you put color information on top of that -- another layer of color onto that -- and it just really makes it come to life.
You can get a lot more information with color. Engineers can put finite element analysis on color parts. They can put stress analysis. They can put all these different things onto it. It's not just taking 3-D pictures ...
Heller: An aesthetic.
MacCormack: Yes. Actually you can get a lot of information via color.
Heller: You can see the actual stress points of the product that you're trying to create. Very interesting.
MacCormack: Yes. You can print out architectural models and you can show in color what way the light would shine in the morning time. You could have different colors for morning and night time. You can see what way the light shines over. There's a lot more information that color brings to the plate.
Heller: When does it actually become cost effective to go with Mcor over say, MakerBot, in terms of running cost? How many models to I need to be producing for that to make sense from a business standpoint?
MacCormack: We have a very good ROI tool that enables you to not just say a standard block shape, but actually run real-world parts. We can take parts that you want to make and we can compare that against other technologies, and you can see the return on investment.
Even though our machine is more expensive, because it's 5-30 times cheaper to run, all of a sudden after a certain number of parts you can get your return back. In most cases, it's within the year.
Heller: I saw something that was about ... how many hundreds of thousands can you save in how many years? What was that quote?
MacCormack: It's in the hundreds of thousands over the life of the product. If you're talking about 3-5 years of the product, depending on the throughput you can be saving hundreds of thousands of dollars over that life, so you can get that back. Depending on your run rate, you can usually get your return back within the year.
Heller: Very good. I wanted to move on now. You have a new product -- or a few new products. I'd like to talk about them. We can demo them here. Let's just go through it.
MacCormack: We've been very busy. There are a few big announcements; the first one is that we just secured a major funding round from WHEB partners in London -- a total round of up to $12 million, WHEB being a major component in that.
Heller: Now you have plenty of cash to go pursue your market opportunity further.
MacCormack: Absolutely. It's been a very interesting journey up to now, but now it's the next step. Mcor is changing now into a bigger company, and this investment has enabled us to not only develop the current IRIS machine, but look at other things.
Heller: In your pipeline, yes.
MacCormack: Other potential products, but also other machines in time; R&D. That's the first announcement.
The second is that we've announced a new product called Mcor FLEX which is -- if you think of paper more like a scaffold -- if paper is like a scaffold and it's around 70% porous, if you take that 70% porous, mostly air, structure and you dip another material or spray another material onto that. When that material cures it actually takes on the properties of that cured material. You can demonstrate flexible materials with this new Mcor FLEX, so that's another announcement that we had at this show.
Heller: Basically, it's still a conceptual model, but you can still have some function to the model, to understand how it will operate in the real world.
MacCormack: Yes. You can simulate a lot more real-world. Obviously, it's not going to behave exactly like a spring, but you can put an assembly together and show parts moving over and back, and it all connected in one assembly. You can demonstrate more assembled objects by using something flexible.
The next thing we're very, very excited about was our new color enhancements. You can see the differences between these two models.
Effectively, we're the first 3-D printing company to adopt ICC, the International Color Consortium, standard. It's almost like a WYSIWYG, for what you're seeing on your screen and what you get on your 3-D color part.
This has run through an Mcor ICC color map, and this model hasn't gone through it. You can see the difference in the skin tones.
Heller: The new technology guarantees that the color is going to be what it's going to look like when it's manufactured.
MacCormack: Yes. A very interesting thing here is, you might know that you can look at an object on a computer screen, and depending on what computer screen you use you're going to see a different color. The color on the different monitors is going to look a little bit differently.
What we had to do is that we went to a CIE standard, which is a 3-D color space, and we find out what that color should really be. Forget about what the monitor shows you. Find out what that real color is in RGB, and then we run an ICC map over it, we send it to the printer, and we get as close as we can to the real color.
So, it's actually monitor-independent, printer-independent, and actually will give you what the real color is. That's a very big development. No other company is able to do that, because ink and paper ...
Heller: Right, you have true color potential, true full color.
MacCormack: You could try and do that, but you wouldn't get close to the color on the other color technologies, so they don't do it.
Then the final big piece of news that we have at the show is that we've come up with a one-button fix -- a bit of the Holy Grail in just bringing in your data. As people know, sometimes you can bring in data and you're just not able to print it; there's a problem with geometries. There have been methods out there for doing Boolean operations and combining multiple parts to get you what you want.
That is OK -- that can be challenging, but people have solved that. But the bigger problem that people have a harder time solving is when you have color. When you have color in those objects and you do a Boolean operation, you can actually lose the color map. You can lose the color information afterwards, and your model can get all messed up in the color.
What we've done is a one-button fix, so if people will bring in the part, they'll hit Generate Layer, and they won't even know that there was a problem.
Heller: You're maintaining continuity, then, throughout the whole process.
MacCormack: We just said Slice, and that will slice it. In a way, they won't even know that they had an issue.
Heller: There's magic happening behind the scenes.
MacCormack: Yes. In a way, sometimes you like to give feedback back to the customer and let them know there's a problem, but if we can fix it why bother? Just make it go through. That's what we've done. It's a one-button fix, and it opens up the capability for us to do this in color, which nobody else has been able to do before. That's very big news in the whole file fixing.
Heller: Very good. I want to talk about your customer base, where you're getting them from, and if you're having success converting Stratasys, 3D Systems customers over to Mcor. Are you having any difficulty, or have they been really receptive? Has the product been well received in the market?
MacCormack: To be honest, our easiest sales are when we walk into an office and they have one of our competitors' technologies, because they know the value of 3-D printing; they've invested heavily to get one. But they also know the pain, and the running costs are very, very high.
Those things are already proven to them. They know what they can do, but they also know it's really expensive, so when we turn up with our solution and they get to see the parts, you don't even have to explain that it's low -- they just know -- it's going to be paper, it's going to be low running cost. They're our easiest sales, believe it or not.
There's plenty of anecdotal knowledge where you could take maybe 10% of a build that's on a very big machine -- on a competitor's, that's very expensive -- and just taking 10% of the work off that machine pays for our machine.
Heller: Your machine, in a way, can be complementary to other technologies, because it's earlier on in the prototyping process, so as they need more functional -- maybe they need multi material, or rubber, or whatever technology is out there, like the Objet Connex3 -- they could use that later on in the process, save their running costs overall by investing in your system earlier on.
MacCormack: I think so, yes. Definitely on the commercial side, I see a position for us to be comparable with other technologies, and we can work hand-in-hand.
Heller: Complementary is interesting. It's not like you're necessarily combative with other technologies all the time. There's instances where both work well together.
MacCormack: Yes, absolutely. I think in that case, that's very well-defined, and we have a lot of examples where we're winning on Stratasys deals, we're winning on 3D Systems deals, very much at the corporate enterprise level.
I think when you move into the consumer level, even though the price point of the machine, as I mentioned before, is high, but the end product I think is very suited to the consumer. We are unique in that way, that we have a very, very good solution; the perfect solution, I believe, for the consumer, for printing out photographs and busts and pictures of the kids.
Heller: I know you have something like that in the Netherlands, through Staples. Is that happening in America any time soon?
MacCormack: Well, all I can say is that we're working with plenty of companies that want to bring that on. It's just very exciting to be able to do that. Not only are people interested in selling our products, but also offering that as a service and offering that to people who don't want to buy a machine, but want to get 3-D printed content.
I think, very similar to the 2D printer analogy where 10-20 years ago people would never dream of printing a photograph at home -- they always went down to their local store or CVS, that would have a bigger, higher-end machine in the background doing the prints. I think there's a similar opportunity for the consumer.
I'm not talking about the makers. I'm talking about the people on the street.
Heller: Right, that want their wedding photo printed.
MacCormack: Yes. They're mom or dad; people that don't know the technology and don't really care how the technology works. They would just like to have a really nice keepsake, something on the mantelpiece or something that they can give somebody as a gift.
I think the access that they need is not about buying the technology, but it's going into a store and making it very easy to upload the content -- or take a photograph, ideally -- and get that printed out in 3-D. I think that's the path, until home machines get to the point where they're just as good as what you get on the industrial machines, which will happen, but just not yet.
Heller: Very good. Thank you so much, Conor. We' really appreciate your time.
MacCormack: No problem. It was a pleasure talking to you again.
Heller: Thanks for watching, ladies and gentlemen. Fool on!
Steve Heller owns shares of 3D Systems. The Motley Fool recommends 3D Systems and Stratasys. The Motley Fool owns shares of 3D Systems and Stratasys. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.