Tony Safoian (00:19):
All right, please welcome to Cloud N Clear. We love having customers on to tell their side of the story on their journey with Google Cloud. And today we’re a special customer, we did a whole article with them a while back, they got great pickup, but here’s a James Franz VP of operations for MakerBot here with me today. Welcome, Jim.
James Franz (00:36):
Thanks Tony. Thanks for having me.
Tony Safoian (00:38):
Thank you so much for doing this.
James Franz (00:41):
My pleasure.
Tony Safoian (00:42):
Everybody knows MakerBot, so I love doing it with customers on the show that have such a strong consumer brand, because some of our customers are like B2B. It’s always great to do one of these episodes with a great consumer brand like MakerBots. So it’s going to be a lot of fun.
James Franz (00:58):
Yeah. Looking forward to it. MakerBot’s been around for quite some time and gone through a few iterations, but certainly it’s a well known product out there, even more so than our para company.
Tony Safoian (01:08):
For sure. Even with the organization about three years, do you mind telling the audience just a little bit about your career trajectory and your journey and what led you to MakerBot and what the last three years at make or bot have also been like?
James Franz (01:19):
Sure. So I’ve been in supply chain and operations now for more than 25 years, the scope of my positions have been different depending on the size of the company I’ve worked for some have been really small kind companies, some the public companies, all in the operational aspect, some, a little bit more broader scope where you get into IT or customer support. And then here at MakerBot, I’m doing, I’m managing the traditional operational activities like logistics and planning and warehousing, but then also our customer support team, as well as our IT and IS team. IT is more infrastructure, IS more business systems and our cloud stack, of course.
Tony Safoian (01:56):
Yeah. There was recently a change that sort of gave you oversight of the IS side of the house as well, right recently?
James Franz (02:02):
That’s correct. So it was funny that the cloud stack was really managed by engineering team because a lot of our products from the engineering side and software side kind of interacted with the cloud stack and we recently had a change in our VP level of engineering, although it was always a budget line in my budget. I actually got management of it now going forward, pretty exciting stuff to learn what goes on there and all the pieces that fit together.
Tony Safoian (02:25):
It’s just so interesting about how operational roles are in some organizations, sort of making this pivot now to own this part of the business as well. Didn’t always happen that way, but now it’s a sort of, it’s core business now, right? Isn’t it?
James Franz (02:39):
No, absolutely. And I think there’s been a change in mindset over the last, I would say five to 10 years in that most people ignored their supply chain and it just worked and people didn’t think about it. And now it’s becoming a real competitive advantage to a lot of companies out there. And then obviously as more and more applications that allow the company to run, move into the cloud, you start getting more deeper and deeper into cloud stack and other applications that happen there.
Tony Safoian (03:04):
I think supply chains have not been tested in recent memory as much as they have been the last year and a half, right?
James Franz (03:12):
That was… Everyone thought the pandemic was bad when everything shut down. And you know, that was really only the beginning. Supply chains are really feeling that shutdown now and then the whiplash effect of everything coming back online and the demand surge that came from it. It’s been an interesting time.
Tony Safoian (03:28):
Yeah, I’m sure. I’m sure people are definitely thinking about supply chains now. You said, you not think about it before because it just always work when it’s not working, it’s like things are delayed outside of your control is definitely gets at the top of mind for people.
James Franz (03:40):
Being in operations is nobody really cares about the 99% of the stuff that goes, right, it’s the 1% that goes wrong.
Tony Safoian (03:45):
Definitely. I’d say that about the uptime in our cloud services that we sell. So tell me about the business of MakerBot a little bit 3d printing hit the market, hit the ground and made it’s just a huge impact, not only on the consumer world, but really manufacturing and design and all these B2B applications and it got to a point where it became commercially viable at relatively low price points is when it really took off, at least in the B2C world and MakerBot and New York based company took the market by storm. But how has that been over the last certainly the three years, but I’m sure the legacy history and the stories you hear at MakerBot go way before that.
James Franz (04:29):
We wrote all of those waves, right? And so when we were the first desktop 3d printing company in the world, we invented it. We were in consumer locations. I remember seeing the product in staples on an end cap and it exploded. And when it was founded, the founders thought there’d be a 3d printer in everyone’s house, printing, kitchen knobs when you wear one out or something like that, I don’t think we’ll ever aspire to get to that point. And then we pivoted when we came to that realization that this wasn’t going to happen and we really pivoted into the educational space and we became very strong in the educational space.
James Franz (05:01):
And so we sold a lot of printers into either individual classrooms or into like print bureaus within a school where different departments could utilize all the printers. And then just recently we introduced a new vertical with our new platform and that’s really going after the professional space and the individual engineer and individual designer and we really have a lot of engineering grade materials that can be printed on a desktop printer now. When in the past it could only be printed on like our parent companies printers that are tens and hundreds of thousands of dollars. And so now at our desktop method printers, we can print with ABS and nylon carbon fiber, all with dimensional accuracy, our customers really love it.
Tony Safoian (05:43):
It’s part of the appeal of the education market too. It’s like you really get to learn about geometry and engineering and physics and also again, to live in a world that seems like science fiction, like 3d printers were something you saw in like science fiction movies and to give that application to students at all levels. I remember when I was at school that was just completely a pipe dream.
James Franz (06:07):
Yeah, it was, it was. It’s all about bringing stem and putting in kids hands and then project based learning. At the end of the day, it’s really cool, whatever they’re thinking of what ever simple object they made could actually be printed and they could take it home with them.
Tony Safoian (06:22):
So like all things you have this sort of innovators, dilemma at MakerBot as well, creating the category, which is very time consuming, expensive, et cetera, educating the market and then really creating a market that’s so appealing, like it’s enough to have competitors. So how have a MakerBot sort of pivoted and navigated that evolving competitive landscape, which is of course we all know super global now.
James Franz (06:47):
Sure. And it’s funny when you look at the context reports and we look at them obviously every time they come out, there’s always two or three competitors, including us that are at the top. And then you have all these other little guys that come in and go and stuff like that. But I think one of our strengths is pivoting at the right time. Then we pivoted into the education market at the right time. And then when we came out through lots of R and D efforts came out with the new platform for method from professional market. Again, I think it was the right time to do that, thankfully we did, right? Because there was no education market when COVID hit and who knows what would happened if we didn’t that platform out in the market at that point, but I think it all comes down to timing and the right execution. And we’ve been fortunate enough to do it at least twice already.
Tony Safoian (07:27):
In our space at SADA, we’ve been in IT services, manage services, cloud, 21 years, we’ve seen many waves. And one of the challenges of course, staying ahead of where you think the market’s going, which is difficult to do, but not impossible and I think had MakerBot been totally enamored with its first success and it first business model success and just stuck there, I think the cards might have been different, but I think living with that healthy paranoia of actually that’s used the momentum we have today and what’s working to already plant the seeds for the next five things that kind of DNA is very important. It’s just things change so quickly today.
James Franz (08:09):
Yeah. We’re constantly looking at our product coming up with obviously trying to sit in stone what the next year is, because that’s so close. But then really looking beyond that to three and five years, I know our method platform even started before I started with the company. It was a four year R and D process. I really took a bunch of technology from our parent company and really put it into a desktop printer, like the heated chamber and some of the melt flow stuff that’s in our extruders, so a lot of higher end technology. We’re now trying to put it into our desktop.
Tony Safoian (08:37):
Yeah. It’s so important to do that and to be patient investors actually, and have a portfolio of things, some things are going to work, some things are not going to work, but you have to try. And I think that seems to be the key to longevity in our customers and certainly the case studies you see good, bad and ugly. We see all the case studies, right? And so for MakerBot we’ve been engaged for quite some time more recently, it was a great headline business insider about your journey with Google Cloud and saving a bunch of money relative to the incumbent option, which was AWS. But I’m even more curious, but more deeply than that, of course we’ll want to cover that made me realize the critical nature of the cloud strategy and the cloud investment in the company more broadly. And I’d love to kind of share that with the audience today. Like what have you seen, how has that evolved? How has cloud enabled the competitive maneuvering and how has it integrated with the overall strategy?
James Franz (09:36):
Sure. We’ve since I started there, we’ve gone through a major transformation. We’ve swapped out our ERP system. We upgraded our CRM system, we upgraded our e-commerce store. We changed our business systems integrator, we launched a new support site, we launched live chat. So all of this stuff was done in the cloud and previously our ERP system was hosted on our servers in our office. There was a bunch of other applications that were hosted in our office and we’ve all moved to the cloud and really it made it seamless to go from March 12th, 2020, working in the office to March 13th, 2021, working remotely. We were using [inaudible 00:10:13] some other teleconferencing system, we moved to zoom. So we really went through it in it and is infrastructure change. And thankfully we did it before COVID hit because we were able to just seamlessly start working from home.
James Franz (10:26):
And even to this day, most people are still working from home with our plan, going back to the office sometime in the fall, it was really important and the systems that we implemented, weren’t only great for now, but if the business doubles or triples we’re ready, our systems are ready. We don’t need to hire two or three times more people to run them. They were built the right way in order to expand in the future.
Tony Safoian (10:49):
Yeah, that mantra for us going into this year, was be ready for anything. And I think that’s part of what a lot of our traditional customers, traditional enterprise customers weren’t thinking about prior to the pandemic, I think they all felt that digital transformation was important, that it would come eventually, that they had all sorts of time to make it happen. People didn’t want to take what they perceived to be undue risk, a lot of people in a lot of roles. And I think what the pandemic showed us was the great sort of divide between those companies that had already been far down that road or started at least, or have been there in certain parts of their strategy and those that hadn’t had a completely different experience in the last year and a half. And looks like you were on the right side of history with deciding to do those projects and not waiting any longer than you had to, and I’m sure it made a huge difference.
James Franz (11:46):
Listen, it was not easy. It was sometimes painful, but I think first, everyone appreciated even before we went into the pandemic because the systems were just that much more advanced, but then obviously it was a night and day difference once the pandemic hit.
Tony Safoian (12:00):
Especially after I’m sure people were like, thankfully there was foresight, making that happen. And similarly we’ve seen the demand for what we do dramatically increase in the surprising, maybe not a surprising way, but I think maybe the speed at which things accelerated, I would say was surprising, but-
James Franz (12:18):
Probably more light bulbs went on that, “Oh, we need to do this.”
Tony Safoian (12:21):
Yeah. It came a existential like moment for a lot of companies, it wasn’t like, oh, we have five or six years to do this. Now, let’s dive into to the GCP specifically, in what ways is GCP being used and deployed and what is it supporting? And what’s the vision for the future around that technology?
James Franz (12:41):
Sure. So, I mean, as we started moving more stuff to GCP and using SADA and their services, we were looking at how things were built and how do we really make it better things that Makerbot being a startup, brilliant people like to implement stuff in their own vision, but it’s a lot of times code and then somebody writes their code on top of that code. And then on top of that code. And so at the end of the day, it almost is like an onion that you have to start peeling back the layers and trying to understand what’s really there and how can we optimize it, make it better.
Tony Safoian (13:12):
I remember from our experience having a MakerBot at home, like my kids navigating it with the iPad app or other mobile apps and just the amount of data you have to store in that and make it searchable, just 3d graphics. There’s different formats, like multiple formats of the same thing and it has a community right where users can go and create and share and make broadly available. And I didn’t realize it was the world’s biggest repository, but it makes perfect sense and that’s awesome because the founders are so that’s so much foresight and creating a community around this, not only education process, but the consumer world and the pro world of 3d printing. It’s a great wedge, I think in terms of the strategy, right.
James Franz (13:58):
That was great. It certainly raised awareness, right? We have over 2 million users, people who use 3d printing for all the things that they like to do, whether it’s a hobby or-
Tony Safoian (14:06):
Yeah. And if you think about the business insider of story, like to the extent that we can help all of our customers achieve that type of financial outcome, where it’s are you saving 30%, doing things a little more efficiently and doing it on GCP, that’s all money that can go back into much more strategic projects and endeavors. And we look at cost optimization being such a critical part of our customers, long term success and long term investment in cloud. It seems somewhat kind of are counterintuitive, but even for our GCP customers, as you’ve experienced, you have a technical account manager from SADA and we’re engaged regularly with your team, but it’s weird, like what we’re definitely dedicated to norm like containing the costs, right? Not spending too much to quickly understanding how to put guardrails around usage spikes and stuff like that.
Tony Safoian (15:00):
Consumption economics is as still a relatively new construct for IT organizations and CFOs to manage. So to the extent that we can help customers get very comfortable with their ability to control it, we know that’s also the key to your comfort level and your budget to invest more over the long term, as long as you can be comfortable with how you actually control and manage it in the short term.
James Franz (15:28):
We’re very conscious of that. And I know that our engineers talks to you guys all the time about and bouncing ideas off you, right. And that’s very helpful for us to be able to bounce ideas off of and make sense or not. And I think was it last week or the week before Eric, my Dev Ops engineer said, “Oh yeah, we’re doing this. It’s probably going to be over the budget by a bunch.” I’m like, “how much the bunch?” He goes, “Only a thousand.” I’m like, “Oh, a thousand dollars were okay.” What he said, we’re over going to be over a bunch. I’m thinking, all right, how much is this going to cost me? Yeah, no, it’s very good. It’s very good.
Tony Safoian (15:59):
GCP’s coming out with new capabilities, new pricing, constructs, new discount constructs, and all these things, so it’s important for us to keep that top of mind for our customers, so we like to bring that expertise, but also MakerBot’s, an engineering company, you have very sophisticated engineers who work there, who we engage with. And a lot of our customers are also like startup digital natives, but it’s also important for us to bring a unique value proposition of super deep technical expertise in GCP as well, so you can lean on us for that guidance. I don’t care how technical our customers are. Generally, there’s some couple things we can find that we’re going to have a little more experience in, or we’ve seen it in a bunch of other environments. And we like to bring that to the forefront as well.
James Franz (16:45):
Yeah. Well, listen, that’s one of the reasons why just recently we went through you guys to get our workspace renewal it’s for the support and my IT person, if they had a problem with Gmail or whatever, he would get in touch with Google and get a tier one person that didn’t know us from a whole, in all, now with you guys, we have account manager that we could talk to understands us, know what we’re knows what we’re trying to do and-
Tony Safoian (17:08):
Yeah, no, Jim, it’s actually an area we invested more and more in the last couple years that customer success piece is so critical for workspace and for GCP. And those roles are actually even like different. The customer success folks are more about orchestration of the relationship and the cadence and the QPRs. And then we have like real, like actual deep engineers to support as well. But thank you for bringing the workspace over too, that’s the design, that’s our vision. We want to be the one throat to choke for all things, Google Cloud for our customers, so looks like, make our bots well in their way and I’m happy when we earn that. So I appreciate you.
James Franz (17:43):
No problem. It also makes it my life easier too. If I have an issue, I know where to go. And so it certainly makes my life a little easier, especially when you have lean teams.
Tony Safoian (17:49):
We think that’s a model for, has the highest potential of creating a very good customer experience if you do it well, I’m glad it’s appreciated. So tell me a little more about what are the things you’re most excited about at make or bot and just where the 3d printing ecosystem is going.
James Franz (18:05):
Obviously I can read the tea leaves and what our competitors are and stuff like that, but I think it’s going to be just like car companies. Advanced technology comes out in the higher end cars and over time that technology gets put into more economical cars as time goes on. I think that will be the future of 3d printing as technology becomes more advanced from the technology that’s in some of the higher end printers today will come down into the desktop space. And so I really think that’s the way it’s going to go and like I said, it’s very similar to the car model.
James Franz (18:34):
As far as MakerBot itself, I’m excited to continue our new product development and release additional new products out into the marketplace. I’m excited to make additional changes within the company. We still have a bunch of stuff that’s on prem and how do we get that off prem? We’re we’re still a split house as far as our cloud storage goes, we don’t have everything transitioned over. And there are some pieces that we haven’t peeled back all the onion layers yet so we still need to peel back those onion layers and how do we make it better? One of the things that we have is a ton of data and we are not utilizing that data at all, we’re scratching the surface.
Tony Safoian (19:09):
Certainly it’s sort of like infrastructure and storage, then data engineering, then the data science journey can begin in earnest after that and we’re at your service to make that a reality, just like car companies. I think it’s going to be more and more software driven in a lot of ways, which is what we’re starting to see with the electric car movement, software is going to continue to be a huge component, all hardware that comes out from cars to 3d printers and to the extent that we can give, MakerBot a competitive advantage, we’re super excited and at your service.
James Franz (19:40):
Looking forward to it. The pie, the sky thoughts that we had maybe two, three years ago are now within reach.
Tony Safoian (19:45):
I can’t wait for this episode to go out and thank you for your partnership.
James Franz (19:48):
No problem, Tony. Thanks for having me.
Speaker 3 (19:52):
Thank you for listening to Cloud N Clear check the show notes for links to this week’s topics. And don’t forget to connect with us on twitter @cloudandclear and our website sada.com. Be sure to rate and review the show on your favorite podcast app.
