TechShop Goes Bankrupt

Update: On December 3^rd 2017, TechShop arranged to sell all of its assets to a new business entity—TechShop 2.0 LLC—ormed by two Midwestern entrepreneurs, Dan Rasure and Bill Lloyd. Details of what’s in store for various TechShop locations are still being worked out, and indeed the TechShop website [PDF] is still reporting that TechShop is closed. For more about this breaking development, see Adafruit's interview with Dan Rasure.

A little over a decade ago, Jim Newton, who once served as an advisor to the TV show Mythbusters, and his partner Ridge McGhee launched a company called TechShop, opening the first of its for-profit makerspaces in Menlo Park, Calif., the beating heart of Silicon Valley.

Their enterprise was seemingly successful, and the number of TechShops soon grew, with 10 of them operating all around the United States by 2017.

But yesterday TechShop suddenly announced bankruptcy—the Chapter 7 kind. So no re-organization; no second chance to get back in the black. TechShop is kaput.

I was very enthusiastic when a TechShop opened in my neighborhood, the Raleigh-Durham area of North Carolina. I never purchased an annual membership there, but I would sign up for a month at a time when I needed access to machine tools.

TechShop provided the only way (short of having a buddy with an old Bridgeport mill or a South Bend lathe in his garage) that a Sunday machinist like me could get access to such equipment. And I once took a welding class at TechShop just for kicks. So I lamented when the company’s Raleigh-Durham location closed its doors in 2013, and I’m sorry for the many others who are no doubt feeling similar sentiments now that none are to be found anywhere in the United States.

So why did TechShop fail? Isn’t the “maker” movement exploding? Some hints come from a message from TechShop’s CEO, Dan Woods, which was published online by Make magazine. In it, Woods explains that the maker movement is very much a not-for-profit affair, often bankrolled by government or philanthropic organizations. And as a for-profit company, TechShop was normally not eligible to compete for such grant money or continuing subsidies.

Woods describes his company’s effort to pivot, to turn into TechShop into some sort of makerspace midwife, which would help non-profits, schools, or community governments set up makerspaces of their own. That wouldn’t seem any more promising of a business plan, at least to me, and I suppose yesterday’s bankruptcy announcement confirms that I would be right to be leery about it. I’m not savvy enough, though, to speculate about whether Woods and his colleagues could have done anything else to keep TechShop afloat. 

You might ask, “What does it matter?” After all, if not-for-profit makerspaces are forming in many places with subsidies from schools and local governments, isn’t that enough? Perhaps, but my limited experience with the makerspaces being established at schools and libraries is that they are makerspaces-lite. They might have computers and 3D printers and perhaps a laser cutter, but look for a bay where you can work on your car or a machine tool you can use to make metal chips fly, and you’ll be hard pressed to find one. So the demise of TechShop does seem to create a big hole in makerdom, one that I’m not so confident that the non-profit sector will rush in to fill.