Business Patterns

Since Fab7 there is talk (and questions) about the 7 "business models" we have identified -- I'd rather call them business design patterns, since they revole around some basic thoughts how a FabLab could generate enough income to sustain itself.

Labs typically use a mix of these models. A typical combination is grant-based plus access fees or education-based plus access fees. Some real world examples can be found in the research material collection:

• Vestmannaeyjar
• Barcelona
• Amersfoort

A summary of the empirical findings from the 2010/2011 Fab Business study can be found in this presentation to Fab7 in Lima, Peru.

The 7 patterns are:

grant-based

Main income stream: public (or private) funding

Main service provided: solving some problem the funding body has allocated money for

Main advantage: running costs covered typically for several years

Main disadvantage: dependent on goals of funding body which are outside the control of the lab

embedded in (educational) institutions

Main income stream: none, but running costs are covered by parent institution

Main service provided: adding to the (core?) activities of parent institution (e.g. education, providing a workshop, enabling certain activities)

Main advantage: if part of core business of parent institution a view to long-term sustainability

Main disadvantage: institutions and open access are often hard to combine

co-x (co-working, sharing infrastructure,...)

Main income stream: little to none, but running costs are covered by other use

Main service provided: making idle infrastructure and equipment available

Main advantage: cross-innovation between host and lab use

Main disadvantage: hard to set-up from scratch as one has to implement two businesses

operating as a prototype shop

Main income stream: work for hire

Main service provided: building prototypes according to specification, ideally together with the customer

Main advantage: FabLab can play in the innovation field

Main disadvantage: helping "inventors" can absorb large portions of lab's staffing time

access fees

Main income stream: hourly, monthly or yearly access fees ("gym model")

Main service provided: access to workshop

Main advantage: stable income stream

Main disadvantage: possible conflict with open access principle

educational activities

Main income stream: course and workshop fees

Main service provided: (ideally: officially approved/accredited) educational activities, lead by FabLab instructors

Main advantage: stable income stream

Main disadvantage: relatively high barriers for entry into the market (accreditation), dependent on money avaliable for external activities in the education system

techno tourism

Main income stream: event or activity based fees

Main service provided: leasurely encounters with digital manufacturing technology

Main advantage: relatively stable income stream

Main disadvantage: dependent on tourism economy

gurus for hire

Main income stream: consultancy or support fees

Main service provided: access to knowledge, access to "official" cirquit of labs

Main advantage: relatively stable income stream as long as number of labs keeps growing

Main disadvantage: even with rapid growth there is only room for a small number of "gurus for hire" labs; potential accusation of creating a ponzi scheme (see http://www.linkedin.com/groups/Business-models-Fab-Labs-89815.S.47978844)