Andreas Velling is CMO at Fractory, a cloud manufacturing platform that connects engineering companies with the manufacturers in real-time. Andreas is a mechanical engineer by trade, but gravitated to marketing thanks to his love of writing, which also shines through in Fractory’s content marketing and blog. We caught up with the engineer-turned-marketer to find out more about the Estonian startup.
How did you end up in the startup world and what were you doing previous to Fractory?
I actually studied to become a mechanical engineer and worked as one for 5 years, designing machinery for pellet factories in Estonia and the cut flower industry in the Netherlands. So I consider myself to be pretty organised (except for my desk).
At the same time, my wife was working for an Estonian startup. It was evident that her job was much more chaotic. And it felt very appealing to me as the unexpected brings on exciting challenges, something very different from structured engineering work.
In 2017 I learned that my friend from university, Martin Vares, had created his own startup – Fractory. The business itself made a lot of sense and I thought this might be my way into the chaos. He didn’t have a vacancy for a sales engineer, as those positions had been filled already. So I joined as a marketer instead even though I had no previous experience in marketing.
What does Fractory do, and what is its business model?
Fractory is an automated on-demand manufacturing platform connecting engineers and manufacturing companies. We provide access to manufacturing processes online, including laser, sheet and tube cutting, metal bending, surface treatment and CNC machining. At the same time, we don’t own any manufacturing equipment ourselves. Rather, we use partners for producing the parts while taking full responsibility for the whole process from quoting to delivery. And act as the only point of contact for the customer.
There is a lot of manufacturing capacity available at any given time but engineers do not know where to look for it. For example, in the Nordics region we are partnered with 70 manufacturing companies as suppliers. So we are also introducing efficiency by directing the work to partners who have the resources, skillset, raw material, etc. for a certain job. We just add a small markup to each order but for the customer, it evens out as we are probably able to find a better price on the market than they themselves could.
Who are your customers?
Our focus is on B2B engineering and manufacturing companies. A lot of our customers are actually manufacturers themselves, similar to our suppliers, who need help with a set of parts they cannot produce in-house.
But we have all kinds of clients from DIY builders to Fortune 500 enterprises. The projects also vary from simple laser-cut art to large welded aluminium boat frames.
What does the process look like from need to delivery, for someone ordering through Fractory?
They create an account, upload their 3D models to the platform, get an instant price and pay. In a matter of minutes. And now they wait until we deliver the parts on the promised date.
And that’s very different from how it usually goes. No need for manufacturing drawings, sending out emails, waiting for quotes for days, etc. This process is what made sense to me and why I wanted to join. We are removing a lot of friction.
Could you tell us more about the state of innovation in manufacturing? How difficult is it to break into, as a startup, and what role can startups play in this industry?
It’s a funny thing. Engineers create innovation in their everyday work. But their everyday work is seldom innovated on.
There’s always something going on but it takes a long time from the first working version to implementation. Just look at 3D printing. Or how IoT is still the central topic of every engineering conference.
I’d say engineers are pretty skeptical, especially when it comes to new things that promise to be a lot better than what they’re used to. Which is pretty much the definition of a startup. So it can be challenging in that sense but at the same time the scarcity of real innovation in the space leaves room for getting through that wall of skepticism.
That’s why I think there’s actually quite an opportunity in the industry for startups looking to improve something. Or redefine something.
Estonia is a hugely successful startup breeding ground. What were the advantages of starting there, and what was the rationale for moving the HQ to Manchester?
I’m not the founder. But from my point of view, the advantages lie with being a “hugely successful startup breeding ground” and Estonia’s size. Meaning that someone knowledgeable, someone who’s been through it all is just around the corner and chances are that you’ll get through to them. Startups move fast and it can be hard to keep up. The possibility to ask for advice at certain points can nudge you in the right direction. So it makes sense to start from here.
The UK is, of course, a much bigger market when it comes to manufacturing. A traditional industry requires relationship-building and being present. So it’s that simple I think.
What is lined up for Fractory in the next 12 months?
Our focus will be on increasing our market share in our existing target markets. All the while, the product will be evolving in directions that are very exciting. Hopefully, we’ll soon be able to introduce those advancements to the wider public.
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