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Space Tank is giving Australian Made a new heartbeat

By Billy Friend – Manufacturing Monthly November Edition 2022

Space Tank Studio is a business makerspace and manufacturing incubator helping local designers and innovators build new to-market products with global potential. Billy Friend spoke to Scott Anderson and Holger Dielenberg about the makerspace’s ambitions for the near-future after successfully pivoting through the COVID-19 pandemic.

New ideas and start-ups inject excitement into Australia’s manufacturing ecosystem. Without innovation and different approaches, Australia risks losing the opportunity to be a player on the world stage, as well as an exceptional manufacturer of things on its own shores.

Currently, the players who are new to the game face major hurdles and barriers to access what they need to succeed. Holger Dielenberg, Space Tank Studio founder, explained that the purpose of the business makerspace is to play a foundational role in the bigger picture of Australian industry – to help innovators and niche manufacturers transform creative ideas into working prototypes with a viable commercial proposition so they will become the engine of Australia’s design economy.

“There are not many avenues for entrepreneurs to access the industrial equipment, network and education they need to achieve this,” he said. “Most of Australia’s accelerators aren’t focused on traditional manufacturing or advanced manufacturing – there’s a heavy bias towards app development software.”

Dielenberg spent 7 years working in Europe where he noticed the development of co-working spaces that focused on creative manufacturing. When he returned to Melbourne, his mission was to merge the incubator model with the creative makerspace model.

“I had spent many years building shared warehouse models for creative use in the 90’s. These types of space are valuable because they support thousands of creative makers and help to maintain a vibrant creative maker culture. But after experiencing the European models and studying the emergence of the Maker movement in the USA, I realized that a commercial mindset in creatives at a grass roots level was missing. Helping people who make physical things get off the ground and supporting their commercial growth, – no one had done it as an incubator model,” he explained. “In 2013, I found a warehouse in North Coburg and started building. We brought together all the fundamental equipment and technology components under one roof, but also the commercial mindset to help develop ideas from napkin, to bench, all the way to business.”

Space Tank has supported over 800 early-stage manufacturers and designers in its 8 years of operations, and won numerous awards for providing specific support to startups. Dielenberg, along with co-founder Scott Anderson, is looking to scale equipment offering in the Coburg North facility, which includes a wood workshop, welding bay, laser cutting, 3D printing, CNC milling, bronze forge, spray booth and co-working fabrication space.

Manufacturing contributes over 20 per cent of Victoria’s economic output – an estimated annual output of $204B – but startups are lacking in sectors that rely on manufactured goods, according to Dielenberg.

Sadly, he said, it is little wonder why Australia has lost major aspects of its manufacturing capability.

“Buying manufacturing equipment in Australia is prohibitively expensive,” he said. “The knowledge to use that equipment can be a challenge. A lot of people enter the world of making and innovating via insights they have gained from their professional activities or from left field inspiration – they don’t want to do a three-year degree; they want to hit the ground running. Australia’s geographic isolation from international markets, relatively small population and high labour rates are against them. Emerging entrepreneurs need to run a lot leaner in the early days considering the long lead time to get to market. Combine these challenges with an incubator/accelerator support network that only caters to App developers and the hurdles for manufacturing startups can be insurmountable.”

The challenges are plenty, resulting in much of the high-end prototyping and advanced manufacturing equipment being used in large corporates, bigger business and universities. Outsiders don’t have the ability to wander into these spaces, but we are seeing more disruptors and early adopters put their hat in the ring, as evidenced by the stories being told in this magazine this calendar year.

So what do start-ups and SMEs require to commercially succeed? Dielenberg said Space Tank sees opportunities to bridge the gap in the are of what is being labelled ‘Applied Technology’.

“We can leverage efficiencies of scale by providing affordable access to high-end equipment as well as the training to use that equipment – the mentoring on how to use efficient advanced manufacturing workflows to process ideas and prototypes quickly and convert a concept to a commercialisation right from the get-go,” he said. “No one can afford an entire factory from day one but renting a studio space with affordable access to equipment lowers barriers to entry. In particular Australia has an advantage in product development where physical and digital worlds meet.”

Every entrepreneur has to start somewhere, so providing our brightest brains with the right education and training is crucial.

“You must learn how to make products that take advantage of current and future technology developments, but more importantly, you must consider your go to market strategy. Building a business case doesn’t happen overnight and in-fact for most creative entrepreneurs it is an afterthought,” Dielenberg added. “We have programs such as the Bench to Business program to make people better entrepreneurs.”

The Bench to Business program is one of three of Space Tank’s training initiatives, helping develop better, more successful founders and applied technology startups. The program is for individual founders, emerging product developers and designers who have a passion and drive to take their concept from napkin sketch all the way to market. The content is across three areas: human centred design, prototyping for design and business and marketing.

Scott Anderson joined Space Tank in 2017, bringing commercial and corporate experience to help grow the business makerspace into a venture studio ‘startup factory.’ “There needs to be a number of building blocks in place to build a successful startup factory”, said Anderson. “In addition to access to equipment and facilities and creating better founders, we need strong corporate collaboration, manufacturing focused accelerator programs and community.”

Space Tank understands the importance of corporate backing, which is why it is working on establishing a CoLab Venture Studio model, bringing together corporates, domain subject matter experts, manufactures and designers to ideate solutions in a defined problem space. The purpose of this is to validate and develop proof of concept solutions, allowing corporates to outsource innovation and commercialisation. It’s not a new concept around the world, but Space Tank is wanting to make it work on our shores.

“Community is an import element to success,” Anderson continued. “Having those conversations in the corridor and bouncing ideas off the right people with an ecosystem around that is valuable. For instance, if someone needs access to specialist services outside of our offering, we can point you in the right direction via our large industry network. We want to look to continue to scale this as well.”

The potential of applied technology

Applied technology combines digital and physical products and systems. Smart products incorporate the use of IoT, sensors and connectivity to genuinely enhance and change our lives. Globally, the bulk of startup activities come from app development, but Anderson and Dielenberg both echoed that the days of App startups with highly inflated valuations and ‘unicorn’ investor hype are reaching market saturation.

“We think that the app space is overcrowded,” said Anderson. “Apps are now used in nearly every aspect of our lives and the App market is beginning to repeat itself. We’ve seen valuations go down but a lot of people are still chasing the unicorns – the billion dollar valuation – which are as rare as hen’s teeth.”

Balance needs to be restored in the startup ecosystem, according to Anderson, with the next steps to support the integration of physical and digital innovations in areas like medical, mobility, clean economy and smart city technologies. This will underpin job growth in future focused economic sectors. For designers and manufacturers, the end of ‘app hype’ marks the opening of a new opportunity space – applied technology.

Dielenberg first used the term ‘Applied Technology’ in a 2018 Melbourne Knowledge Week presentation. The term is now being used more commonly to describe Australia’s modern design and manufacturing landscape. With the help of government funding, Swinburne University and RMIT are now starting to offer diplomas and degrees in applied technology, which are engineering and digital technology courses developed in conjunction with industry partners.

Space Tank has always supported creative and niche manufacturers like furniture makers, lighting designers, jewellers, set and prop designers. But Dielenberg feels more focus needs to be placed on makers using technology.

“We have supported the growth of some innovative product developers like Bastion Cycles using ergonomic 3D design and carbon fibre and 3D printed titanium, Eutropia Aerospace micro rocket propulsion systems, Jaunt Electric Vehicles, UpperLimbCo orthotics, Freo2 oxygen delivery systems and Freeform Composites carbon 3D printing technology. Our goal is to increase our support for these kinds of startups.”

“We can fit around 25 businesses at a time at Space Tank and help them grow. Innovators can now make a ‘dumb’ product smart and combine things in ways never before possible, which can help Australian entrepreneurs to overcome business scaling challenges like the tyranny of distance, our small population, gender imbalance and high labour costs.”

To support this mission, Space Tank is looking at scaling its equipment and programs to attract even more high-tech startups. “We think there is a good opportunity to grow Space Tank’s CoLab Startup Factory concept in new design/innovation precincts such as the Brunswick Design District and Fishermans Bend.” said Scott.

Launch Vic have been very successful in growing the state’s startup ecosystem, but Anderson explained that the Government has an opportunity to ensure balance between App and Applied Technology startups.

“Thanks to Covid, political vision for sovereign manufacturing and strengthening Australia’s supply chains are finally catching up with public and industry opinion,” Holger said. “A shared and immediate challenge facing our governments, businesses and institutions, is to transition our society from an economy based on finite resources with limited options, to a future where infinite knowledge and creative enterprise create unlimited opportunities to thrive.

“Creatives, entrepreneurs, designers, engineers and startups will be the most important people leading the way.”

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