Holt says Proto Labs' rapid growth 'doesn't happen on its own'

PLYMOUTH, MINN. — Vicki Holt's team at Proto Labs Inc. has taken prototype manufacturing and shipping to the extreme.

Want that prototype in two weeks? Done. Tomorrow? No problem.

“We take months out of the product development lifecycle, which is really important to manufacturing companies to be vibrant, to be able to innovate and bring things to market quick and cost effectively,” said Holt, who joined Proto Labs as CEO 18 months ago.

Speed sells at Proto Labs. In fact, the company is growing so fast Holt hired its first senior vice president of human resources to help the publicly traded firm (New York Stock Exchange ticker symbol PRLB) manage its scale and growth.

Let's talk numbers: In February 2014, Proto Labs employed 750. Today, it's 1,200. In 2014, sales hit $209 million. By the end of 2015, Holt projects $250 million in sales.

“Growth is fun. Growth is hard work. It doesn't happen on its own. We have to make it happen with people, processes, energy, strategy and critical thinking. But it's fun work. I've been on the other side where you have to shrink first to grow. That's gut-wrenching work,” said Holt, 57, who previously held leadership positions at Spartech Corp. and PPG Industries and sits on the board at Waste Management Inc.

Proto Labs breaks the mold by conducting all its business online.

It starts when an individual product developer uploads a 3-D CAD file onto Proto Labs' website. In one to four hours, the developer is looking at an interactive quote with all types of technical specs.

“Then they finalize that quote: Foop! Within seconds, it's going through our process and getting staged as to where it's going to fit in manufacturing. Then we turn around custom injection molding molds and samples in a standard 15 days but you can go as little as a day,” Holt said.

Product developers at Fortune 500 companies and entrepreneurs alike are uploading files every day of the week. In fact, almost 12,000 individual product developers did just that in the second quarter of this year. (That's up from 9,200 in the same period in 2014.) And the staff at Proto Labs sees real-time data displayed on monitors throughout the facilities tracking the daily and weekly progress of molds made, quotes created and more.

“A lot of these engineers don't want to talk to anybody. They just want to order their part and get their part. We have a lot of customers like that,” Holt said.

Key end markets

Holt, who is always on the lookout for software engineers, sales people and mold technicians, says the medical, aerospace and automotive electric vehicle industries are strong for Proto Labs.

“We are not going to be a large-volume producer because our value proposition really resonates in prototyping and low-volume production. Our sweet spot is 10,000 parts or less,” she said.

The company has three divisions: Protomold, the injection molding unit that makes up 63 percent of sales; Firstcut, which makes parts and generates 29 percent of sales; and the newest piece, Fineline is 8 percent. Proto Labs acquired Fineline in April 2014.

Fineline will soon move into a 77,000-square-foot facility that will house Proto Labs' North American additive manufacturing headquarters in Cary, N.C.

In typical Proto Labs' fashion, Fineline is seeing a surge under new ownership. Annually, the unit generated $10 million in sales before the Proto Labs' purchase. In the second quarter alone of this year, Fineline already had sales of $5.5 million.

Holt isn't eyeing any additional acquisitions in the short term. She does, however, tick off plans for adding space to existing operations: First up is its facility in Japan, after that the office in Telford, England. By 2016, the company will look for more U.S. office space followed by more U.S. manufacturing space by late 2017 or 2018.

“What keeps me awake at night? People and infrastructure. Having the right talent being acquired. Being able to assimilate that talent and develop our own leaders. And then having the infrastructure in order to facilitate that growth. Those are the things I think about,” she said.

Future goals

Holt also has the lofty goal for Proto Labs to have the world's most powerful web presence and be a destination for engineers.

“Plastics is certainly a big part of our core and will continue to be. We process hundreds of thermoplastics and even thermosets with [liquid silicone rubber] now and even customer-supplied custom materials. So we are in the plastics business. But we also like to think of ourselves as technology agnostic. So if our customers really have a demand for a different material or a different process, we want to be able to expand our processes to meet their needs. We have that development product at the center of our universe,” she said.