TechShop: an industrial revolution for $125 a month

Someone, Mark Hatch, if I had to guess, has left a Square reader just to the left of where we've set up our cameras. It's on a table next to a small, but exceptionally diverse array of gadgets. There's a wooden book that unfolds into a desk lamp and a polymer incubation blanket for infants that's "on track to save 100,000 children's lives," according to Hatch, TechShop's spikey-white-haired CEO. But it's the little white plastic dongle that's the star of this show, through the power of sheer ubiquity, popping up in coffee shops and taxicabs everywhere. Square's modest undertaking has since ballooned to a roughly 300-person operation. The project was born in this very space, eventually moving to a building in San Francisco's SoMa district a block or so away, the mobile payment company having opted not to travel too far from the place where it was first conceived.

When it comes to proximity, Square is by no means an anomaly -- if anything, the company's strayed a bit away from the pack. TechShop's overseers have, quite cannily, begun to offer up a portion of the warehouse's 17,000 square feet as office space, giving its members a shot at some prime San Francisco real estate, a flight of stairs up from an impressive array of machine tools -- laser cutters, waterjets and more 3D printers than most mortals have seen in one place. "Literally everything you need to make just about anything on the planet," says Hatch, in typically definitive terms. And while there's arguably still some sense of hyperbole in the notion of the "next industrial revolution" (as 3D-printing evangelist Bre Pettis loves to put it), it's hard to stand here in the well-lit warehouse amongst the buzz of machinery and ideas and not appreciate the sentiment.

TechShop's mini-empire of social hackerspaces stands as a testament to the right idea at the right moment. It's the result of a whole lot of distinct elements congealing into a successful business model, including a membership fee that gains you access to the tools and classes to help you do just about anything yourself. A $125/month fee gets you access to everything you need to get in on the ground floor of the hardware startup revolution. Inside the warehouse, you'll find a makeshift salon of students, young professionals, industry veterans and curious hobbyists meeting in the downstairs machining area and upstairs on sunlit benches for makeshift beta testing and freeform workshopping.

Founder Jim Newton, a robotics professor and onetime MythBusters science adviser, set up shop at the first Maker Faire in 2006, behind a sign reading, simply, "TechShop: Build Your Dreams Here." The 250 showgoers who signed his mailing list formed the basis of the company's first space, a cobbled-together collection of equipment housed in an industrial building just off the freeway in Silicon Valley-entrenched Menlo Park. The company's since launched locations in Detroit, Pittsburgh, Raleigh-Durham and Austin, and added an additional two to its Bay Area arsenal, included this San Francisco locale, which has become something of a de facto flagship location for the organization. Locations in Arizona, Brooklyn and Washington, DC, are currently in the planning stages.

Hatch cites any number of factors as contributors to his company's success, beginning with a dramatic reduction in the price of machining equipment, thanks in no small part to the influence of Japanese and Chinese producers. The phenomenon has led to an astonishing 75 to 85 percent drop in the price of the tools that are so core to the TechShop experience. The introduction of desktop computing has also had a profound effect on that front.

"A lot of these tools are hooked up to computers, so they're computer-numerically controlled machines," says Hatch. "And of course that computer and that software have followed Moore's law. The CNC mill, 10 to 15 years ago, would've been a quarter-million dollars, and we're now buying this machine for less than $20,000. What we do is we layer this, you know, membership-based system on top of this. So for $125 a month -- or as I like to say 'for the cost of a coffee addiction' -- you now have access to the tools of the industrial revolution."

Then there are all of those elements that have driven the birth of the hardware startup movement. As foreign influence has driven down the price of manufacturing tools, the race for dominance in the commercial mobile space has significantly dropped the pricing and size of mobile components, all while power and availability have skyrocketed. The explosion of commercial 3D printers and microcontrollers means that prototyping is no longer the semi-exclusive domain of larger companies. And, of course, the influence of crowdfunding has offered more than enough incentive for creative tinkerers to fully invest in seeing notebook sketches through to fruition.

"As a result, you create your own job," explains Hatch. "You create a job for your friend, and your next friend, and pretty soon you need an office."

While there's much to be said for the communal nature and exchange of ideas that comes with setting up camp in the kitchen of one's hackerspace, the time eventually comes for most companies to do business behind closed doors. For TechShop, the answer is quite simple: be the one to build those doors. The company has constructed offices on-site, allowing fully formed companies to exist in the same space as newly realized projects, maintaining access to the impressive array of tools and the TechShop hive mind.

"Part of our design is to have startups actually officing on-site, and they often graduate," says Hatch. "Then they'll move, you know, a couple blocks away like Square. It's literally a half a block away and they now have something like 300 employees." Now the place is home to a diverse and fascinating array of companies and organizations like San Francisco Made, a non-profit that, quite fittingly, is focused on promoting local manufacturing.

There's also Type A Machines, a company borne out of the RepRap 3D open-source 3D-printing home revolution.

"All of us are members here," says CEO Kevin Roney. "We actually base our operations here in an office on the third floor. Type A Machines does its complete production here in San Francisco at TechShop. We use the Tormach [CNC mill] for milling out the hot ends, the waterjet for cutting the fanblade mounts [and] the lasers for cutting the casing."

It's quite a thing to behold, really: the company's full production line laid out in its small, backroom offices, its Series 1 printers all assembled on-site. They're a small, but powerful reminder of how the hardware revolution may some day help turn the tides on the steady loss of manufacturing jobs in this country. This all still seems a bit of a pipedream for major manufacturing, but as demand for products becomes more fragmented and niche, it's possible to see an increasingly important role for localized manufacturing.

Located just next door, ProtoTank is more an idea factory than a miniature in-house hardware manufacturer. "We're three guys and one girl who just decided it was way too much fun to build hardware together," explains co-founder Sam Brown. The company started life with the creation of a Mario Bros.-inspired desktop lamp, a cube sporting the familiar question mark that illuminates with impact. The location of its first office space was a natural fit, given the communal nature that gave rise to the company.

"These are some of the brightest minds I've come across," explains fellow co-founder Adam Ellsworth. "While it's a four-person team, we certainly wouldn't be in the place we are without the community. We can create prototypes and small manufacturing runs with tools it wouldn't be possible to fund ourselves. We couldn't afford a waterjet, and a laser cutter would be a pretty large investment, but being in this building allows us all that."

In amongst all this movement, the US government itself is beginning to take notice of TechShop's goings-on.

"One of our biggest fans is David Kappos, [former] head of the US Patent and Trademark Office," says Hatch. "He came to Menlo Park a few years ago and did a presentation to a bunch of inventors, and at the end of it, grabbed our founder, Jim Newton, and said, 'Hey, we've got to work with you guys because this is exactly what we need. We need more inventors in the US, and we need to communicate better on what the provisional patent means and how to go through the patent process and my examiners are really there to help.'"

The solution to improved communication between the two parties is a sort of red Batphone that connects directly to the USPTO hotline, located just to the side of a bank of computer workstations on the second floor.

"We told the commerce department [about the phone]," says Hatch. "They, of course, then told us that we need[ed] to have a green phone that hooks directly to Commerce Connect."

It's easy to see why the government would take notice of TechShop. The space is a utopian prototype for the push to foster a more startup-friendly environment in the US. As with the media landscape before it, one can foresee a future when a fair amount of hardware will shift to a hyper-specialized model, with many consumers trading in mass-produced products for limited-run devices targeted toward their individual needs and desires. The smartphone revolution has done wonders for the speed, size and price of components and explosions of programmer-friendly hardware like Arduino boards and desktop 3D printers have made it that much easier to transfer ideas from the drawing board to the real world. If the US government has its way, of course, that manufacturing will be happening right in our backyard. And with the help of crowdfunding sites and desktop prototyping, it just may be TechShop that leads that charge.