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Ponoko: the Wellington startup leading the handmade revolution

If you can draw your idea, Wellington startup Ponoko can probably make it—and find buyers for it too. Idealog meets the New Zealanders at the forefront of the handmade revolution

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Derek Elley (left) and David ten Have photographed by Matt Grace

If you can draw your idea, Wellington startup Ponoko can probably make it—and find buyers for it too. Peter Griffin meets the New Zealanders at the forefront of the handmade revolution

Sue Tyler has always been a crafty type. It started with Christmas decorations when she was a kid and moved on to jewellery, badges and magnets. “I grew up in a family that thought it didn’t matter if everything you had to wear was plain. Just put some nice jewellery on and it will look pretty,” says Tyler, who does the accounts for a Wellington IT company by day and indulges in her passion for craftwork at night.

A regular at craft fairs—she runs the popular Craft 2.0 exhibitions in conjunction with Lower Hutt’s TheNewDowse gallery—Tyler has until recently relied on fairs, local shops and the odd listing with handmade goods marketplace Etsy.com to sell her creations.

In late 2006 she started to put photos of her jewellery on photo-sharing website Flickr.com. That’s where Wellington web entrepreneur David ten Have saw her work and realised he could help.

Ten Have was building a website called Ponoko.com. Instead of simply listing handmade goods online, ten Have planned to go one further and create a marketplace for ideas, where people looking for something a little more quirky or original could pick a design listed on the website and have it custom-built with an industrial laser cutter.

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Lamp by Rebecca Bulman

In its simplest form, Ponoko is an online gathering place for digitally-minded designers and craft makers. But ten Have’s plan is much more ambitious than that. It taps into the emerging personal fabrication movement and a growing appetite for one-off designs in our homogeneous consumer society.

Looking for some local guinea pigs, he got in touch with Tyler, who used to design jewellery with little more than a vague outline in mind. Last April she began teaching herself how to use Adobe Illustrator to create her designs digitally. She learned fast.

“Now I’ll sketch things on paper, then often scan the image onto my computer and trace around the image,” she says.

“Then I start tweaking it digitally. That’s what takes ages.”

Tyler began uploading files of her designs to the Ponoko website. Ponoko then used her precise designs to cut the pieces of jewellery using a computer-guided laser beam. The pieces were couriered to Tyler, who assembled them into the finished product. It’s a new, simpler way of working that appeals to Tyler, who makes all sorts of things—brooches, bracelets, necklaces and earrings—and works in everything from acrylic and veneer to plywood and plastic.

“Ponoko is like an online Ikea catalogue, but cooler,” she says. “My ideal is to be able to store all of my stuff just on Ponoko and not think about having to list anywhere else.”

Tyler made Ponoko’s very first sale: a set of jewellery bought by a woman in San Francisco. And while there have been some “fantastic catastrophes” with her designs, experimenting has led to some creations she believes have worldwide appeal.

“I’ve taken a punt and put in some big orders. So when someone orders stuff through Ponoko, I can send it off straight away.

“I’ll be making a loss this financial year, but the dream is to be creative full-time. Other people pay sports subs, I give Ponoko my money.”

If you want to see where Tyler’s virtual designs end up, you have to visit the cramped backroom of Ponoko’s central Wellington office. With the $50,000 laser cutter and ten Have (32) and co-founder Derek Elley (35) leaning against it, there’s not much room to move.

The cutter looks like a large photocopier but has a base of honeycomb-patterned metal, which smells of burned wood. In an equally small room next door sits the computer that receives designs from Ponoko users and drives the laser cutter.

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Snoork (above) and Erik (below) acrylic brooches from Grimlies series by Chromatophobic

After the pieces are cut, they are flat-packed in courier boxes ready for shipping. The last thing Ponoko does is whack a big sticker on the box. It reads ‘Yippee! Another Ponoko package.’

The startup’s name conjures up images of Pinocchio, the boy carved from pine. It’s a nice fit with the craftwork hosted on Ponoko, but the name is actually derived from Poneke, the area Wellingtonians know more commonly as Port Nicholson.
“We started swapping vowels until we got a dot-com,” says Elley. “But maybe that story will evolve over time.”

The pair, veterans of the Wellington web development scene, had two things in common in the early days of their careers: they both studied at Victoria University, though their paths never crossed, and they both went on to work at software developer Advantage Group, where they became friends.

At Victoria, “I was a business guy,” Elley says. “I did marketing and finance and law.” Ten Have completed an “elongated” bachelor’s degree in science but never got around to finishing his master’s degree in technology management. “I ran out of cash and I didn’t want a student loan, so I punched out of university on the very naive belief that the thesis I needed to complete could be done at nights and on the weekends,” he says.

Ten Have has been tinkering around on the web since “the first release of Mosaic”. His father was an aeronautical engineer for the Royal New Zealand Air Force, which meant he not only travelled as a child between the country’s airbases and had a stint in Britain where his father was posted, but also that he was immersed in design and engineering from an early age.

“I was brought up in workshops. My father was building aeroplanes when I was a kid,” he says. “It exposed me to interesting ways of making things.”

His entrepreneurial side was formed at Victoria, where he sold his services designing websites for the university’s departments. Elley, meanwhile, wasted no time after graduating from Victoria in 1997 to dive into the tech sector. He helped build some of the country’s first online stores. “Not all of them worked, but it was enough to pay the bills,” he says.

Eftpos terminal maker Advantage Group was undergoing a rapid transformation in the late 90s, gobbling up software companies as the dot-com bubble and a stock exchange listing produced plenty of cash for investment. Many a young software entrepreneur did a stint at the company, which threw everything into its hot new business—developing e-commerce platforms.

Kids know how to use the cutters and the software. They’ve abandoned the traditional tools, they don’t use them any more. It has changed the gender dynamic of design. You’re starting to get 50-50 mixes in those classes

“At the time they had 50 people and they could fit everyone in a 737 and fly them all to Fiji for a company conference,” says ten Have. “When I left in 2000, there were 300 to 400 people.”

But the bubble was bursting for Advantage and the tech sector. Ten Have departed with four others to form Provoke Solutions, a software developer that worked almost exclusively for government departments.

“We grew it from five people and zero revenue to 30 people and $3 million in revenue after five years,” he says. “I worked really hard for three years, I got into the process of running a company. I learned a lot but eventually you just start doing the same things over and over again.”

As a diversion, a side-project, he taught himself how to use vector graphics software, which allowed him to create precise designs of objects, blueprints from which a manufacturer could work.

“I was really surprised I couldn’t just send the files somewhere and have the bits sent back to me,” says ten Have, who sold to his fellow Provoke partners in 2005.

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Side table by Rudo (left), made from veneer MDF; Lissabon bedside table (right) by Hannah Gardiner, made from interlocking hardboard

Meanwhile, Elley had helped start search engine optimisation and web marketing company First Rate. By 2002 he had moved on to a new venture, software developer Calcium Software, and also set up venture capital incubator Sparkbox. Elley took a break in 2006 and went travelling overseas. On his return he caught up with his old mate Dave to air some ideas for new ventures.

Most entrepreneurs have moments of self-doubt, when they think their grand venture isn’t going to fly, that no one will understand it let alone use it. Many can recollect key inspirational moments that convince them, if only just, that their beloved venture has legs.

There have been plenty of those moments in the short history of Ponoko, a key one being ten Have’s pitch to his future business partner.

“I tabled an idea, Dave tabled an idea,” Elley remembers.

“I tried to tell him how shit his idea was and how good mine was, but we ended picking up his idea.”

The idea was the bare bones of Ponoko.

Around the same time Elley listened to a podcast that, he says, “blew me away” and convinced him the concept had legs. To the average listener, the rapid-fire, jargon-laden presentations of Neil Gershenfeld may not make a hell of a lot of sense. But Gershenfeld had the ideal audience listening in the South Pacific.

Gershenfeld, the director of Massachusetts Institute of Technology’s Centre for Bits and Atoms, believes personal fabricators will revolutionise the world in the same way personal computers did in the 1980s, allowing people to design their own products in their own homes using simple technology and have them made to order.

One customer’s first effort had been a miserable failure. “Second time, she turned up and put this lamp on the table. I was looking at it … the clarity of design, the beauty of it …” Ten Have shrugs, rendered speechless by a lamp

“We’ve had a digital revolution in communications, we’ve had a digital revolution in computation,” says Gershenfeld in that podcast. “They’re done. We can go on and do something else now and that is the digitisation of fabrication.”

The world we live in, Gershenfeld points out, is still made by “melting plastic and whacking metal”. But it can be designed completely digitally and built on machines capable of producing almost anything.

“It was the eloquence of him puting the history of manufacturing together with what’s going to happen in the future,” says Elley. “It takes a massive, massive intellect to pull that all together in a presentation.”

Another one of those inspiring moments for the pair came during an early morning visit to Victoria University’s design school. “We hooked up with a guy called Ross Stevens, a senior lecturer in design,” says ten Have. At the time Victoria had a single laser cutter; Stevens would come to work at the crack of dawn to use it for his own projects before the rush of students.

“We get there about 7:30am. Ross leads us through the workshop. I kid you not, at 7:45 there’s a knock on the door. Ross opens it and there’s a queue of students standing there. They’re waiting to use the laser cutter.”

The businessmen were looking at Ponoko’s core demographic. “There are kids being pumped out of that school who know how to use the cutters and the software. They’ve abandoned the traditional tools, they don’t use them any more,” says ten Have.

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Lamp by Nick Griffin

He believes the move to teaching digital fabrication in universities is changing the face of design in more ways than one. “It’s just designs that compete, not manual dexterity. It has changed the gender dynamic of design. You’re starting to get 50-50 mixes in those classes.”

These days, the emotional boosts come mainly from Ponoko’s community—seeing imaginative designs translate into physical objects. Ten Have remembers an early gathering of Ponoko users that included a mother of two who had never used vector design software. Her first effort had been a miserable failure, he says. “Second time, she took some advice. She turned up to the Paramount and put this lamp on the table. I was looking at it … the clarity of design, the beauty of it …”

He shrugs, rendered speechless by a lamp.

The woman’s design had been uploaded to Ponoko, the components cut on Ponoko’s laser cutter, then flat-packed and couriered to her for assembly. Ten Have compares this creative community of designers to the experimenters chipping away on home-made projects in the early days of computers.

“It’s the 70s all over again, minus the acid.”

If you’re going to launch a dot-com, people from the Valley will tell you to do it at a big conference, and make a big splash doing so. That’s exactly what Ponoko did at TechCrunch, an invite-only showcase of 40 startups chosen from around the world that took place in San Francisco in October 2007.

Idealog—which had first written about Ponoko two months earlier—was on hand to witness Ponoko’s big moment on stage in front of the venture capital community, the US press and some of the wealthiest technology entrepreneurs in the world.

Ten Have held his own against the saccharine pitches of American rivals who had their routines rehearsed down to the last detail. “There were all these optimisation things on show, then we waddled on stage with this big idea,” he remembers.

The presentation went down well and the resulting press buzz culminated in a write-up in The New York Times. Set up with funding from a handful of local angel investors, Ponoko’s ambition is to secure further cash from an influential US backer. How much are Elley and ten Have looking for?

“We had a million-dollar offer from a local firm which we turned down,” says Elley.

Why—did the investors want too big a stake?

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Sue Tyler’s necklaces are made from a choice of materials, including hardboard, plywood, radiata and Eurolite

“They always want too much, but it wasn’t really that,” he explains. “It was really hard for us. They have massive credentials here, but not in the US. So we took the punt and went off to present at TechCrunch.”

The closing months of 2007 saw the pair attend meeting after meeting in the San Francisco Bay Area, New York and Boston—the personal fabrication movement’s strongholds. “Thirty minutes’ drive out to Oakland are some of the key thinkers in this game,” says ten Have. The US tour also took them to the New York offices of Etsy.com, the popular online marketplace where Sue Tyler sells her goods.

“Our mission is to enable people to make a living making things, and to reconnect makers with buyers,” reads the Etsy website. The creation of Rob Kalin, a painter, carpenter and photographer who couldn’t find anywhere to viably sell this work online, Etsy in three years has attracted 100,000 sellers advertising everything from home-made handbags to stuffed toys. It employs 48 people.

More aligned with what Ponoko is doing is Instructables.com, a venture born out of the MIT Media Lab that offers a platform “where passionate people share what they do and how they do it, and learn from and collaborate with others”.

Rather than being viewed as a threat, Ponoko was welcomed by these companies, says ten Have. “A lot of them say, ‘We’re doing what we’re doing because we couldn’t figure out how to do what you’re doing.’”

Ponoko’s niche is not only to foster an online marketplace for crafty types to sell their wares, but also to marry digital designs with buyers and manufacturers armed with laser cutters.

While Ponoko now has a shortlist of five venture capital players and web entrepreneurs willing to inject money, it sees the larger players already in the field as potential partners.

If the dream scenario for Ponoko’s founders is to host an online community linking people who can create literally anything they want, the reality is currently much more modest. The materials available to Ponoko users are limited to what can be handled by a laser cutter—plywood, MDF, hardboard, acrylic and the like. As a result, jewellery, small pieces of furniture and ornaments dominate the listings on Ponoko.

“We thought we were offering quite a restrictive product, with laser cutting only and a set of materials. It turns out that having quite a constrained offering reduces the learning required,” says ten Have.

Rather than being viewed as a threat, Ponoko was welcomed by U.S. companies, says ten Have. “A lot of them say, ‘We’re doing what we’re doing because we couldn’t figure out how to do what you’re doing’”

“In the short term it’s all about control and quality and getting it right.”

While Ponoko is limiting itself to laser cutting while it irons out the model, it is also exploring other manufacturing techniques, including the use of 3D printers and machining tools that use computer numerical control. Adopting those technologies would increase the types and sizes of products that could be made, but requires partnering with specialist manufacturers.

Ponoko is currently building the e-commerce engine that will allow payments and royalties to be divvied up through the website, but big questions remain over how much control Ponoko will seek to retain when the community grows. It accepts no liability if products don’t turn out the way buyers expect, operating much like an Internet provider that hands off Internet traffic.

“This wouldn’t scale properly if we were quality-assessing every design that went through Ponoko,” says ten Have. “The community teaches people how to use the system and they represent the main form of QA.”

The website is policed for plagiarised designs and a secure system means sellers who want to sell only completed products, rather than the design specifications for them, can upload their designs to Ponoko and the manufacturer without leaking their intellectual property.

“We’ve a lot to learn,” admits Elley. “We’re kind of guessing these are the ways things are going to work.”

So what was the big idea he presented to ten Have—the one that didn’t fly?

“It was all to do with OpenID,” says Elley, referring to a technology that allows one common login to be used across multiple websites. “I’m still passionate about it and it’s something that fits within the world of Ponoko. But this idea is much bigger. It could have significant impact for a place like New Zealand. It’s a platform for export nations to seamlessly attack the rest of the world,” says Elley, as he and ten Have get back to their MacBooks and their plans for building a virtual manufacturing empire.
“This idea resonates.”