BMJ Score: 2.7
Quick Summary9 Investors read this
CommentaryToday, the manufacturing industry is dependent on intelligent systems that are able to communicate to each other and react to information in real time. One area that has not adapted as swiftly to this innovation is process control. Manufacturing facilities face challenges around outdated and unreachable technology, unproductive supply chains, capacity planning, machinery health monitoring, and poor energy usage. Manufactory wants to help by combining blockchain, AI, automation, and cyber-physical streams into what is known as the Industrial Revolution 4.0. Their goal is to develop a private blockchain platform that provides a decentralized global manufacturing supply chain ordering platform with a trust engine focused on quality control. It will also simplify the payment process and create an incentive for monitoring how energy-efficient a company’s manufacturing process is. Manufactory will also have a decentralized marketplace that will enable OEM’s to build their own Dapps and connect to the ecosystem. According to PWC, the manufacturing industry will invest over $907 billion annually through 2020 on Industry 4.0 technology, including better monitoring of machine quality, energy usage, and adaptive control. While we like the blockchain application for this market, we are concerned about the competition. Manufactory does not have significant buzz, and there is more information available for the project’s competitors like IOTA, Productivist, and Syncfab. Manufactory claims to differentiate by being the only platform with an integrated Quality Management system and production optimization protocol, but without a working MVP it is hard to say it is better than its competitors. The team is very small with only two members on the executive board, and neither lists any blockchain experience. While the project does list some advisors, we did not see any partnerships. Developing an entirely new blockchain and ecosystem will require substantial R&D and a large network to generate user activity. What we saw from Manufactory did not make us confident in the team. At the end of the day Manufactory has a great idea, but we are concerned about the project’s lack of marketing, small team, and lack of MVP in competing with its many competitors.
- How to invest: Official instructions on how to invest have yet to be released but will likely be first available directly from the Manufactory newsletter. Just enter your email on the main site to sign up.
- Discount: Bonus = 100%, therefore 1 ETH = 1,500 + 1,500 Bonus = 3,000 MFR tokens.
- Eligibility: Restricted countries include U.S., Canada, China, Cuba, Iran, Iraq, Syria, Yemen, North Korea, and Singapore.
- Token Price: 1 ETH = 1,500 MFR
- Jurisdiction: United Kingdom
- Accepted currencies: ETH
- Minimum purchase: 1 ETH
- Problem addressed/solved: Every manufacturing facility must solve problems that negatively affect its production activities while finding ways to maximize its capacity. Manufacturers also have the challenge of competing in a global manufacturing environment by becoming more efficient while still maintaining quality and reducing costs.
- Target customers/customer/ segments/verticals: The obvious clientele of Manufactory would be manufacturing companies and large-scale wholesalers. Most of the manufacturing in the world takes place in China, so look for Manufactory to push its platform heavily in that region.
- Value creation: Manufactory’s vision is to facilitate the digitization of manufacturing data through Industry 4.0 and the Industrial Internet of Things (IIoT) and to provide an intelligent decentralized ecosystem that allows cyber-physical systems to easily interact with it. This will empower manufacturing facilities to maximize the efficiency of their assets and create intelligent manufacturing systems allowing any size enterprise to produce an exceptionally smart factory on a level not seen before.
- Competition: So far, there hasn’t been a project that has combined all of the required elements (Blockchain, IoT, AI and automation) and focused on an industry-specific solution like Manufactory has, so there are few companies that can be directly compared with the project due to its combination of these elements into one distributed ledger system. However, companies such as GE, Productivist, and SyncFab have at least started to develop platforms that offer similar solutions to that of Manufactory. A full competitive analysis done by Manufactory can be found on page 27 of the whitepaper.
- Market size/potential: A PWC report on Industry 4.0 commitment proposes that investment is already significant and global industrial companies will invest $907 billion per year until 2020. It also states that companies across every industrial sector expect a yearly cost reduction of $420 billion, making Industry 4.0 a very attractive technology in which to invest. Other PWC research shows that 9 out of 10 companies are investing in digital factory technology with 98% of those expecting an increase in production efficiency from their investment with a payback of between 2 and 5 years.
- Regulatory risks: Manufactory, like all other ICOs, faces regulatory risks in the crypto space should the token sale be prevented. In addition, this industry faces extreme regulatory mandates. The lack of global regulatory harmonization and understanding often means that manufacturing sites must run old and new processes side-by-side. The complete implementation of any novel technology is driven by the speed of the slowest global regulatory approval, and while Manufactory aims to help with this, vendors may be slow to adopt given the traditionally slow speed of regulation.
- Investor value: The Manufactory token value will be associated with the expansion of the ecosystem and related marketplace. The larger the ecosystem, the higher the demand for the MFR token, which will, in turn, increase its value.
- Disclosures: Manufactory has a decent whitepaper and FAQ section, but the project doesn’t offer much beyond those two documents. The whitepaper checks all the boxes in terms of disclosing the Token Generation Event, business model, and technical side of the project.
- Token distribution: 40% token sale, 20% user growth fund, 20% founders/advisors/management, 10% reserve, and 10% technology organization.
- Use of proceeds: 50% R&D, 20% marketing and customer development, 10% administration & operations, 10% technology infrastructure, 5% partnerships & acquisitions, and 5% legal & compliance.
- Caps: Soft cap: £2.8 million; Hard cap: £14 million
- Track record: The CEO, Ben Bartholomew, has a strong LinkedIn presence due to his 26 years of experience in manufacturing and the development of supply chain technology. Ben has also created manufacturing specific software that utilized big data technology and automation. The only other member of the core team, COO and Co-Founder Russell Ranford, is a serial entrepreneur with extensive business management skills. The rest of the group consists of advisors who mostly have backgrounds in manufacturing or engineering, and not too much blockchain expertise.
- Integrity: It’s curious that the Manufactory project has only two core members and the rest are advisors. The project should definitely look into expanding the team unless the Co-Founders are truly confident that they can essentially scale the company by themselves.
- Ben Bartholomew, CEO and Founder (LinkedIn)
- Russell Ranford, COO and Founder (LinkedIn)
- MVP: Once Manufactory has secured funding through the private sale and pre-sale, the team will create a Minimum Viable Product (MVP) and proof of concept.
- Token use case: The MFR Token will be used to enable participants to create transactions within the Manufactory eco-system. It will be the main currency for the Blockchain, keeping transactions simple and monogamous.
- Value-added: The MFR token will ensure that transactions occur automatically and also keep operational costs to a minimum.
- Decentralization: Manufactory seeks to provide an intelligent decentralized ecosystem that allows cyber-physical systems to easily interact with it.
- Token Supply: A finite quantity of 325 million MFR tokens will be distributed.
- Technical difficulty/investment expertise needed: The goal of Manufactory is to empower manufacturing facilities and help them increase their efficiency and capacity while keeping costs low. The logistics and technological factors will confuse most non-tech investors, but Manufactory has a solid Q&A section that explains many complicated aspects of the company.
- Halo effect: Manufactory has not listed any partners as of writing. The Manufactory project proposes to utilize strategic industry partnerships and acquisitions that will enhance and cultivate the Blockchain ecosystem, acquiring said partners with part of the funding raised from the Token Generation Event.
- Buzz: Manufactory has a few features on low-level ICO review sites along with a couple of blog articles. The Twitter account states that it has over 2,000 followers, but each post has essentially zero engagement. Plus, the Facebook account has a grand total of… 1 follower. That said, the project has acquired over 9,000 members on the Telegram account.