Located in Hsinchu, Phrozen's office showcases hundreds of unpainted gray models on shelves, along with various colored dental molds and invisible braces. Its international presence is evident, with promotional videos presented in English to global users. Outside the factory, pallets stacked with boxed machines are ready for shipment to Malaysia.

Co-founder and CEO, Wu Yi-ren (Ray Wu), revealed that Phrozen's 3D printers have been sold to Western defense and aerospace units, and Hollywood prop studios, and are used by over 20,000 dental technicians worldwide. "We've become a hit abroad," he said.

Phrozen is one of the few hardware companies in Taiwan to survive and continue growing after the 3D printing boom. The global desktop 3D printer market was worth nearly 80 billion Taiwanese dollars in 2022, and Phrozen has sold over 60,000 3D printers worldwide. While their market share is less than 2%, their revenue has grown rapidly from over 300 million in 2020 to nearly 1.1 billion Taiwanese dollars last year.

(Source: Jun-Zhu Wang)

A Rare Hardware Company in the Startup Scene

In 2013, with 3D printing in a global boom, then-US President Obama mentioned in his State of the Union address that 3D printing would become a crucial technology for the United States to lead the world. The government invested billions in research and development.

That same year, sensing the business opportunity in 3D printing, Wu and Li Chang-xian, colleagues at DuPont in Taiwan, decided to quit their jobs and start a business in their early 30s, focusing on photopolymerization technology used in 3D printing.

When Phrozen was established in 2016, photopolymerization was an emerging field, and the two founders, with their engineering backgrounds, were passionate about technological innovation. They first improved the uniformity of the light source projection, enhancing printing accuracy. Additionally, they replaced the RGB tri-color display with a monochrome LCD, which increased light transmittance and boosted printing speed by three times.

However, to scale the technology, they needed the cooperation of panel manufacturers to produce special specifications panels for the 3D printers, with each mold costing millions. They approached several domestic panel manufacturers and finally found Giantplus Technology, a company specializing in small and medium-sized panels, willing to collaborate. However, Giantplus requested that Phrozen commit to buying 6,000 panels per quarter and also demanded an increase in Phrozen's capital.

"They were afraid that we would go under before the molds were ready," Wu recalled. To meet Giantplus's requirements, both founders used their savings, borrowed money from family and friends, and even mortgaged their houses, increasing the capital from NT$5 million (US$160,000) to NT$20 million.

Phrozen invested over NT$10 million, testing the molds six or seven times to ensure their technological specifications were ahead of their competitors. When Phrozen became the first company to globally launch a desktop 4K and 8K resolution photopolymerization 3D printer, their competitors only had 2K and 6K resolution machines.

Gradually, Phrozen gained recognition in the global maker community, entering the dental, corporate, and government sectors. They attracted investments from companies like Innolux Venture Capital and Top Taiwan Venture Capital. A senior executive from a 3D printing competitor noted that besides Phrozen, he hadn't heard of any other 3D printer companies in Taiwan with a significant international presence.

"It's rare to see Taiwanese startups with such determination to risk everything," said Zheng Pei-yu, Vice General Manager of Top Taiwan Venture Capital. He observed that Taiwan's current tech entrepreneurship is predominantly focused on software, with few willing to venture into the hardware sector due to high capital investment and management complexities. "Doing hardware is challenging, and Phrozen is quite a unique presence in the startup scene of recent years."

Lowering the Barrier for Dental 3D Printing

However, Phrozen also faced fierce competition from Chinese manufacturers offering lower-priced machines. Anycubic and Elegoo, the two largest photopolymerization brands in China, have caught up technologically and are cheaper than Phrozen.

Wu gave an example, saying that last year, a competitor sold an 8K resolution machine for around US$500, but this year, a Chinese panel manufacturer launched a 12K resolution LCD, and the competitor's new product price plummeted to US$350.

Phrozen has 150 employees in Taiwan. (Source: Jun-Zhu Wang)

Fortunately, Phrozen possesses a moat that Chinese competitors cannot breach - its high-end position in the dental equipment market. In the domestic dental equipment distribution channel, Phrozen is the leading player for dental 3D printers.

The key to their success in the dental field was early strategic positioning. As early as 2017, Phrozen reached out to authoritative dental experts in South Korea and Europe and America, with some Taiwanese dentists attending seminars in Korea and getting in touch after seeing Phrozen's machines, asking if they were distributors, which amused Wu.

Initially, Phrozen used consumer-level printers for dental models to enter the dental market. Later, they developed a separate product line specifically for dental use, collaborating with dentists and schools to collect feedback and adjust designs and parameters to create high-end machines tailored to dentists' needs.

In the dental field, Phrozen's competition comes from Europe and the US, with cost-effectiveness being their greatest advantage. For instance, National Taiwan University's Digital Dentistry Skill Center has six Phrozen machines, operating almost non-stop.

One dentist said that machines from European or US manufacturers start at NT$200,000, and some could even cost NT$500,000, yet their print quality doesn't compare to Phrozen’s consumer-level printer, which costs NT$20,000. Meanwhile, Phrozen's dental models are priced at around NT$100,000, offering a competitive price.

"Phrozen has significantly lowered the threshold for dental professionals to use 3D printing," said Lin Yuan-min, a professor in the Department of Dentistry at Yang Ming University. The university has also opened courses to teach students how to use 3D printers, equipping them with practical skills. He believes digital dentistry is the future, and Phrozen still has ample room for growth.

Unfazed by Chinese Competition

Why can't Chinese competitors achieve the same level of success? Li, who also serves as the Chief Technology Officer, provides insights from Phrozen's newly established production line in Dongguan in 2021. He said that Chinese startups focus on sales volume and use mass-market and low-price strategies to sell products on e-commerce platforms, generating large revenues to facilitate company listing.

However, sales strategies for high-end dental machines differ entirely, requiring sales through specialized distributors in various countries and operating through offline channels. Distributors need profits, so they won't sell low-priced products and are not willing to cooperate with promotional activities. 

These differences in business strategies allow Phrozen to break through in the dental sector despite intense competition from Chinese players.

"The relationship with distributors is the key in the professional machine sector," Wu stated. Phrozen has collaborated with first-line medical distributors in the US, Europe, Japan, and China, a barrier that Chinese competitors cannot cross.

Currently, 80% of Phrozen's total revenue comes from consumer-level printers, with 20% from high-end dental machines, yet the latter accounts for the majority of their profits.

Besides dominating the dental sector, Phrozen is also expanding into other vertical markets. For example, they manage a content library providing numerous designers' graphics. They also collaborate with German chemical giants, BASF, and Henkel, in resin development.

In Wu's blueprint, Phrozen aims to be more than just a hardware company. They want to build an entire ecosystem, making it simpler and more convenient for users to turn ideas into finished products.