The Next Wave Will Be Physical: A Future You Can Touch

Posted on August 10, 2012

In the past, making complex physical goods for which you didn’t have the recipe could be challenging or impossible. How would you make your own barrel from scratch?

Hundreds of years ago you might seek out a master craftsman who may to may not tell you the secrets of his or her trade. More recently, best way to answer such a question was go to your local library and find a book on the subject. However, a reference on the topic might not even exist for more esoteric goods.

Within the last few years, the ability of the Internet to facilitate global communication has supported the rapid growth of maker/doer communities around the world. Want to make a barrel today, no problem, just check out the 37,000 videos on the YouTube!

Just as the ability of the Internet to facilitate communication has supported the exponential growth of complex software through open source communities, we appear to be at the start of similar revolution for the production of physical goods.

Increasingly popular communities of makers have grown up around popular topics such as DIY electronics. These are commercial efforts focused on education, community and sharing. For example, SparkFun and Adafruit have huge educational efforts that support their main business of selling electronics gear.

Just as the software industry is moving toward a model where the tools are open but the operation of those tools is the product (see cloud companies like Twitter), I hope there is a similar approach for the world of physical goods. A compelling model has yet to emerge. The dream of finding the product you want on Thingiverse, sending it your 3D printer and having it produced in minutes certainly is exciting.

The challenge is that centralized manufacturing will likely have a fundamental cost and complexity advantage for the foreseeable future — 3D-printing the latest iPhone with a 16-layer PCB and a custom 32nm chip in the comfort of your living room would certainly be cool. Fingers crossed for that desktop atom-by-atom builder! In the near term, manufacturers will have an incentive to keep their recipes hidden since only they can produce the cheapest and most advanced parts.

That said, the rate at which we are sharing information on how to build stuff is getting faster and faster. Making simple products yourself will get simpler and simpler as designs, parts and manufacturing techniques being more accessible.

Investors looking to capitalize on this trend might look toward the success of RedHat and Github. Bet on organizations that are leading the communities that support individuals and small companies manufacturing physical stuff. The long-tail will lead the adoption curve as more and more people and companies become their own builders.

Here’s to a future you can touch. Maybe it’s time to get that CNC machine?