Commercial due diligence in additive manufacturing

Due diligence in a niche additive manufacturing sector with evolving technology, determining the true potential for a PE target.​

This scenario-based project, grounded in a solid fact-base and acquired understanding of this particular technology and its future use-cases, unpacked and assessed long-predicted sector hockey-stick growth to build a robust view on the future outlook, the target’s ability to capture it, and the cash requirement to achieve that growth. ​


Market and industry reports had been forecasting hockey-stick growth in this niche market of 3D printing for many years, with no evidence materialising. Our client, a large PE firm, wanted to determine their target’s true potential. 

To unpack and assess the real potential required robust analysis of a series of factors, industry by industry: likely future use-cases for this technology, addressable market size and outlook, and the current and full-potential competitive positioning of their target.


We combined desk research with customer, supplier, competitor and industry expert interviews to tease out the real potential future use-cases and size the addressable markets for this technology, gathering robust reasons why growth would now materialise. And we evaluated the competitive positioning of the target’s technology and pricing, and its ability to capture future growth.  

We provided challenge to management’s revenue forecasts and tested execution sensitivities affecting the EBITDA outlook. On the revenue side that included volume, mix, pricing and timing; execution sensitivities spanned operational efficiency, direct and indirect cost inflation, and order-to-cash cycle timing. These were integrated into a model, which fed into the PE firm’s valuation.


The initial phase highlighted a range of potential revenue and market share growth opportunities, and we went on to assess the cash required for the business to reach its full shareholder potential. 

Our analysis gave the PE firm a clear understanding of where future growth would come from and a robust sense of what was different this time and hence why this growth was actually likely to happen. 

When fed into our model, the team’s analysis indicated a positive growth picture, although less optimistic than management’s, and a significant and previously unanticipated cash requirement to achieve that growth.