First Resonance, a downtown-based manufacturing startup, announced on Monday it raised $12.5 million in an extension round led by New York-based Third Prime with additional participation from firms like Century City-based Blue Bear Capital, bringing First Resonance to $32 million in funding.
The company, which was cofounded in 2020 by former engineers at SpaceX – the Hawthorne-based rocket company aiming to reduce the cost of space travel through rapid manufacturing development – is part of the hard tech manufacturing boom taking Silicon Valley by storm.
“We really do believe that the 2020s is going to see an acceleration of all this,” said Karan Talati, a cofounder and the chief executive of First Resonance. “The offshoring capitalist form of financially engineering manufacturing has basically now dried up with labor costs in places like China. Not to mention the geopolitical tensions. And, all of a sudden, there’s a demand to redistribute manufacturing globally.”
Software for the hardware world
Funding will go to, among other things, further developing its platform called ION Factory OS. Through the platform, companies can tinker with new builds virtually before bringing them into life and digitize physical parts to keep track of each slab, tool and piece in inventory and production. The platform is used by over 50 companies in aerospace, energy, defense, robotics and tech, according to First Resonance.
“There’s a lot of nuts and bolts and details of really complex and nuanced workflows within factories,” Talati said. “…it’s a lot more diverse than even a software company is. And to make sure that information moves seamlessly across those people while having the traceability on the actual product that’s being built is really complex.”
The process of manufacturing cars, electronics and aircrafts is littered with unknowns. Material shortages, changes in shipping and logistics and the everchanging cost of goods create a domino effect that impacts production times and makes it difficult to predict how scalable and profitable commodities are. Designers, engineers, machinery operators and supply chain overseers all work together to make a single product.
“You can actually start bending the assembly line to get even more efficiency and more quality by constantly moving information and calculating that information in a way that allows these companies to be on top of their quality outcomes and improve their throughput,” Talati said.
Manufacturing growth
Advanced manufacturing is one of the rare industries that didn’t absolutely nosedive in terms of funding after 2021. Deal count globally remained stable with around 1,650 companies getting funded every year between 2021 and 2023, according to Pitchbook data.
The reasons are obvious – geopolitical tension, climate change and increased reliance on the grid (thanks to energy-guzzling artificial intelligence) made manufacturing virtually recession proof. The Biden Administration made manufacturing at home a big priority, to reduce reliance on other countries’ infrastructure. There’s a labor shortage in domestic manufacturing that is driving technology development. But if one wanted to create a robot to perform some of those manufacturing tasks, they would still need humans to manufacture it.
“If labor costs are going to be high in those places, technology can actually come in to make those places a lot more productive and efficient,” Talati said.
Los Angeles is mobilizing to meet those needs. Hawthorne-based Freeform, another SpaceX alum’s manufacturing venture, raised $14 million in October. El Segundo-based Orbital Materials, which received an undisclosed investment from NVIDIA’s venture arm in October, uses artificial intelligence to source new materials and this summer Graymatter Robotics raised a $45 million series B round.
“No one was paying attention to this massive need of the manufacturing industry and manufacturing runs our economy,” GrayMatter Chief Executive Ariyan Kabir said in June. “You stop making parts, you cannot sell them, you cannot run any advertisement for them. It’s a cascading, catastrophic effect on the whole economy.”
