Crump, Scott

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Crump, Scott

Chief Executive Officer of Stratasys, Inc.

B orn S. Scott Crump, c. 1954; son of Ralph E. Crump (a chemical engineer, businessman, and venture capitalist); married Lisa; children: one daughter. Education: Washington State University, B.S. (mechanical engineering), 1976; University of California at Los Angeles, business degree.

Addresses: Office—Stratasys, Inc., 14950 Martin Dr., Eden Prairie, MN 55344.

Career

I DEA, Inc., Seattle, WA, co-founder and vice president of sales, 1982-88, director and shareholder, 1982-2005; Stratasys, Inc., Eden Prairie, MN, co-founder, chief executive officer, president, treasurer, and director, 1988—, chief financial officer, 1990-97.

Awards: Entrepreneur of the Year Award (Manufacturing category in the Minnesota and Da-kotas Division), Ernst & Young, 2005; named one of the best chief executive officers in the United States by DeMarche Associates, Inc., 2007.

Sidelights

T he co-founder of Stratasys, Inc. and an engineer, Scott Crump developed his patented fused deposition modeling (FDM) process and sold small rapid prototyping machines widely used in industry by engineer and designers. The primary executive of his company, Stratasys eventually became the worldwide leader in the rapid prototype trade and a solid success story on Wall Street.

Born around 1954, Crump was the son of Ralph E. Crump, who had a career as a chemical engineer and in business. His father was later a venture capitalist who used his funds to help start a number of companies. As a child, Crump was a tinkerer who refurbished a car for his mother at the age of 14. Crump followed in his father’s footsteps by studying engineering, though the mechanical variety, at Washington State University in the 1970s. To pay for college, he refurbished Volkswagens and sold them. He graduated in 1976, and later earned a business degree from the University of California at Los Angeles.

In 1982, Crump was the co-founder of IDEA, Inc. (later known as Structural Instrumentation Inc. and then SI Technologies, Inc.), a Seattle-based company which made force, load, and pressure transducers, automated packaging machinery, and electronic equipment for the transportation industry. He also served as the company’s vice president of sales. Crump remained in the positions through 1988. In addition, Crump served as a director and held stock in the company through 2005, when it was sold to Vishay Intertechnologies.

In 1988, Crump and his wife, Lisa, moved to the Minneapolis-St. Paul area and founded Stratasys. Crump took on numerous leadership positions within the company, including chief executive officer, president, and treasurer. In 1990, Crump temporarily took on another position in Stratasys, serving as chief financial officer. Crump held the position through 1997. Crump founded the company to sell his patented rapid-prototyping method which he had devised in his garage workshop while trying to make a toy frog for his young daughter. His idea was to improve the mechanical design process, a feat he accomplished by inventing FDM and devising related machines.

Crump’s rapid prototyping machines directly converted computer-aided designs into three-dimensional models made of proprietary thermo-plastic or wax modeling material through the FDM process in only a few hours. Previously, the production of such models would take weeks or months. During the early years of Stratasys, it lost millions of dollars. In 1991, the first year the Crumps offered their rapid prototyping machines on the market, the company had $900,000 in sales.

Stratasys was one of only a few companies selling such technology at the time, though many competitors were entering what was becoming a major business. With rapid prototyping machines, companies could develop products which reached market faster and explore different options with prototypes because of the decreased costs and greater flexibility associated with rapid prototyping machines. Crump’s machines had some advantages over his competitors. While others almost exclusively sold large machines meant for use in a laboratory or industrial shop, Stratasys sold smaller machines which used nontoxic materials safe for an office or school environment.

By 1994, sales had increased to $3.8 million, but Stratasys was still losing money selling the machines and modeling materials. Despite the losses, Stratasys went public in October of 1994. At that time, the stock was trading at five dollars per share, a figure which did not vastly increase until early in 1995. The stock price had nearly tripled a year after its initial public offering and the company had a market value of $60 million. The reason for Stratasys’s turnaround was an ever-increasing demand for its machines by companies in the automotive, consumer products, and medical products industries. Even NASA (National Aeronautics and Space Administration) bought one to potentially use on the space shuttle.

Crump’s company continued to thrive in 1996 when sales jumped to $26 million and a 34 percent share of the market. Though Stratasys’ stock price rose through early 1997, a few missteps—a new product introduced by the company having technical problems and pricing difficulties in a European market, among others—led to a quarterly loss and a temporary decline in stock price by the spring. However, because the rapid prototyping business was expanding at a speedy rate and with the introduction of new products, Stratasys soon rebounded.

Under Crump’s leadership, Stratasys continued to thrive over the next decade despite greater competition because of never-ending demand for its continually improved and refined line of machines. The 2002 introduction of the Dimension line, which sold for less than $30,000 and could produce prototypes in minutes, greatly enhanced sales. In 2004 alone, the company had $50 million in revenue.

By 2005, Stratasys was the recognized leader in the rapid prototype industry worldwide, selling twice as many machines as its nearest competitor, the Burlington, Massachusetts-based Z Corporation. However, Stratasys remained essentially a small business with only about 200 employees, but one which did business around the world and remained a staple of Wall Street trading. Stratasys retained their position as world leader for several years, with revenues, net income, profits, and stock prices continuing to rise in 2007.

Crump rode the wave of Stratasys’ success with a relatively relaxed attitude. He told Neal St. Anthony of the Minneapolis Star Tribune in 2004, “The last 15 years have been challenging, a lot of fun, and because I like to work, it’s been very interesting. Any success I’ve had I attribute to the excellent team and the passion the people have brought to Stratasys. That’s been very gratifying.”