Gelato, a Norwegian-born platform that enables creators around the globe to produce and ship customized products on demand in the end-customer’s market, has secured a total of USD $240 million in new funding.
The current business model of the company enables users to achieve achieving fast order-to-delivery times with little to no inventory or investment. In the 3D printing world, this business model is already applied by a great number of companies, like i.materialise or Shapeways.
The capital injection will accelerate Gelato’s market penetration and growth in the US and Asia, and its expansion of new local production hubs and products, including 3D printing.
In the mainstream end-customers’ market, the company plays a role in the production and distribution of customized products such as wall art, clothing, books, and home décor through its hyper-local network of worldwide production partners and software. However, let’s note that the company’s key strength relies in a software that connects to idle production capacity using an API module.
The market for customized products is expected to grow from $230 billion to more than $320 billion by 2025, according to Gelato estimates, fueling a surge of creators and entrepreneurs who sell customized products online.
With 3D printing onboard, the company may expect to generate more profits in the business as one of the major benefits of this technology is to enable customization.
“By bringing production of customized products to local markets all across our planet, we empower ecommerce sellers and the creator economy to serve any customer, anywhere, in a way that is much more cost-effective and sustainable,” states Henrik Müller-Hansen, CEO and founder of Gelato. “Through software that connects to idle production capacity, our platform is taking an active part in transforming global manufacturing as we know it. As ecommerce continues to grow, so will our local production partners and their ability to create jobs in their local communities.”
As for the funding round, it is led by New York-based global venture capital and private equity firm Insight Partners, with participation from SoftBank Vision Fund 2, as well as funds managed by Goldman Sachs Asset Management, and existing investors, including Dawn Capital, John Hepburn, chairman of Gelato, SEB Pension Fund, and Tellef Thorleifsson, CEO of Norfund.
Adam Berger, Managing Director at Insight Partners, will be joining Gelato’s board. “Gelato is a game changer for the world’s creator community. With Gelato’s software, an entrepreneur in, for example, Africa, with a great idea and little to no capital, can in minutes be able to produce, ship and get paid for their product sold in, for example, Germany, with no upfront investment in inventory, manufacturing or logistics – and achieve similar profit margins as competitors 100 times their size. This levels the global creator and ecommerce playing field and is an enormous economic and social opportunity. We believe Gelato is solving hyper-efficient local production at a global scale. With the emergence of new technologies such as 3D printing, Gelato’s curated and global marketplace will empower businesses and consumers around the world,” says Berger.
Since Gelato opened its API-driven platform to the ecommerce industry in 2019, it has supported both larger companies and individual sellers and creators across the world. In Q2 2021, the company delivered an annual revenue growth of 120%. The revenue is propelled by the company’s API business which grew at 320% YoY.
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