Proto Labs puts medtech manufacturers on the fast track

It's good to be Proto Labs (Maple Plain, MN). The $200 million rapid injection molding and machining company continues to record stellar financial results, with 25% year-on-year growth. Although it serves an array of industries, medical device manufacturing represents a sizable chunk of the business. PlasticsToday met with recently appointed President and CEO Victoria Holt at NPE2015 in Orlando, FL, last week, where the company had a booth. 

"Risk mitigation and the cost of regulatory approvals are huge problems for medical device manufacturers," says Holt, and Proto Labs' quick-turn prototyping capabilities can be a fast, affordable part of the solution. "One of our medical customers brought in eight different design iterations of a device and had us mold them all," says Holt. "He wanted to put these prototypes in the hands of surgeons to get their feedback and fine-tune the design of the final product." Producing multiple iterations of a prototype is viable using Proto Labs technology since it "takes virtually the same amount of time and cost as it would to make one prototype the conventional way," says Holt.

The process is simple. An online quoting system analyzes the customer's CAD model and may suggest revisions to improve manufacturability. A quote can be provided within one to three hours. Rapid injection molded plastic, metal and liquid silicone rubber prototype and low-volume parts can be made in one to 15 days; engineering-grade plastic and metal parts in quantities ranging from one to 200 can be machined in one to three days. The company also offers 3D printing services. The latter is a fairly small part of the business, representing 8% of overall sales, but it's growing rapidly. "In Q4 2014, it grew 48%," says Holt.

Beyond prototyping, medical device companies use Proto Labs to produce final parts when the quantities warrant it. "Volumes can be small for some medical instruments, sometimes fewer than 5000 parts annually," says Holt, "so our technology can make a lot of sense from a cost and time perspective."

Holt joined the company a little over a year ago, after a stint as CEO of Spartech, where she engineered a turnaround that resulted in a 73% increase in operating earnings in just two years. That led to a successful sale of the company to PolyOne Corp. She has also held leadership positions at coatings company PPG Industries and Monsanto. "I have 30-plus years of history in manufacturing, and many of those years were spent in plastics," says Holt. So, why Proto Labs now?

"Proto Labs has a unique and defensible business model that delivers value to customers," she explains. "And we are not in competition with molders," she stresses, perhaps because she was more or less on their turf at NPE2015. "In fact, we often work with molders, who send us business when the volumes are too low for them." She also lauds the company culture, which values teamwork, trust and human resources. That made it easy to say yes to the position, she says. Ordinarily, you might chalk that up to feel-good corporate talking points, but Proto Labs, it seems, does actually walk the walk.

Proto Labs has been voted among the top 100 Minnesota workplaces by the Minneapolis Star Tribune for the past four years and has been recognized as one of Forbes' Best Small Companies in 2013 and 2014. For insights into the company culture and how it has achieved success, check out an article in the Motley Fool, "How Proto Labs Inc. Strives to Make Employees Happy."

Holt also points to the company's Cool Ideas program, as an example of its forward-thinking, innovative ethos. The contest is open to entrepreneurs in the United States and Europe who have a great idea for a product but lack funding. A panel of mostly independent judges—Larry Lukis, Proto Labs founder and Chairman of the Board, is one of five—evaluate the submissions, and the company will award up to $250,000 in free manufacturing services to the winners. The company has been running this program for the past five years.

That's a cool idea, all right, and, on the face of it, Proto Labs seems like a pretty cool company.

— Norbert Sparrow

Norbert Sparrow is Senior Editor at PlasticsToday. Follow him on twitter @norbertcsparrow and Google+.