Desktop Metal, a maker of 3D metal printing systems for commercial and industrial use, raises $160M led by a subsidiary of Koch Industries at a ~$1.5B valuation
Dan Primack / Axios :
Context & Ripple Effects
Desktop Metal has been on a fast fundraising cadence: a $45M Series C from GV, BMW, and Lowe's at a $305M pre-money valuation in early 2017, followed months later by a $115M Series D backed by NEA, GV, and GE Ventures. The new $160M round is notable less for size than for who leads it — a Koch Industries subsidiary, putting an industrial conglomerate at the top of the cap table at roughly five times the 2017 pre-money mark.
Koch's involvement fits a broader pattern in its dealmaking: the conglomerate was separately reported to be acquiring enterprise software firm Infor in a deal said to be nearly $13B. For Desktop Metal, the round landed well — the company later agreed to combine with Stratasys in an all-stock transaction valued at ~$1.8B, suggesting the private valuation held up through the public-market cycle.
First-order effects
- Desktop Metal gets $160M of growth capital at a ~$1.5B valuation to scale its commercial and industrial metal printing systems, with Koch Industries' subsidiary as lead investor rather than the venture firms that anchored its earlier rounds.
- Koch gains a direct strategic position in metal additive manufacturing, complementing its reported push into industrial technology via the near-$13B Infor acquisition.
Second-order effects
- Rivals in adjacent 3D-printing segments face a bar set by strategic-backed balance sheets: Carbon raised $260M at a $2.4B valuation months later, and Divergent Technologies went on to raise a $230M Series D led by Hexagon and then $290M at a $2.3B valuation.
- Corporate investors taking lead roles compress the role of traditional VCs in hardware-heavy manufacturing startups, pushing funds like NEA and GV toward earlier or smaller positions.
Third-order effects
- If strategic conglomerates keep leading rounds in production-grade 3D printing, the sector consolidates around vertically integrated players — a path Desktop Metal itself followed into the ~$1.8B Stratasys combination, while Divergent's missile-parts focus shows defense emerging as a parallel demand engine.
- Industrial-family capital becoming the default funder of manufacturing-tech startups would reshape exit paths: trade sales and mergers among incumbents (Stratasys-Desktop Metal) over IPOs, with valuations anchored by strategic value rather than public-market comps.
The trend: Advanced-manufacturing startups are shifting from venture-led to strategic-led capital, as industrial conglomerates like Koch and Hexagon buy positions in the 3D-printing stack they may ultimately absorb.