Roopinder Tara posted on October 23, 2019 |
A surprise announcement about the richest CAD startup ever.

The company that started the latest revolution in mechanical CAD is being bought by the company that started the first one. In an announcement that knocked us off our chairs, CEO Jim Heppelmann revealed PTC will be paying $470 million for Onshape.

Sound like a lot of cash? It’s less than twice what Dassault Systèmes paid for SolidWorks ($310 million) 22 years ago. It’s a tenth of what Siemens paid for Mentor ($4.5 billion).

Onshape, the free, cloud-based CAD application, you could run on your iPhone – or just about anything else – was the most anticipated success in this decade. Led by CAD savant, Jon Hirschtick and the original cast of SolidWorks, money poured in. Media and analysts lavished attention. Onshape got $169 million in funding, making it the richest startup since there has been CAD.

But the company never released any figures of subscribers -paying or nonpaying. We find out today that it had 5,000 subscribers. We have to assume that means paid subscribers because 5,000 for a free CAD product as robust as Onshape would be pathetic. DraftSight and SketchUp, both free, have millions of users. But converting a major portion of a million users from free to paid is not easy. Users of the free version on Onshape were being pestered to convert. Big wins with big manufacturers were few and far between or always just around the corner.  The original pricing model was scrapped. The new pricing was considerably higher. We were told there was no problem.

For the most recent generation of engineers, Onshape was a no brainer. You could get it for free, use it on any device and anywhere and it could any thing the other CAD programs, most of them costing thousands of dollars upfront, could do.

Onshape may have been a harder sell for veteran engineers -- and the companies that employ them, to change design applications, especially one that needed a constant connection to work and put your models on the cloud for everyone to see.

Why PTC?

Knowing Hirschtick, it’s hard to believe Onshape was not shopped to all the major CAD players. Why PTC was the one to buy them…we may never know.

PTC roared onto the CAD scene with Pro/ENGINEER in 1987. Engineers were quick to latch on to parametric modeling. It was so successful its salespeople had to triage potential customers. If you weren’t big enough, the salespeople would not pay a visit. If you were not ready to sign, they would lose interest and move on. PTC has become part of the establishment, its own revolution now more than 30 years old. The company has added so many non-CAD products to the portfolio that CAD insiders thought it had lost its focus. Heppelmann came with PTC’s acquisition of Windchill and for years, PTC insisted it was a PLM company.

With this acquisition, PTC stands to get its CAD mojo back.

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