15 ms·

TechShop shuts down all U.S. locations, declares bankruptcy

214 points by wizardforhire 9y ago

viewtransform 9y ago
At the Redwood city location there were many artists and small businesses that depended on the facilities. It will be a big blow to them. I think they got reckless with their expansion. The San Jose location moved to a new location after their lease expired. They chose to relocate to a prime location in downtown San Jose and ended up with a million dollar shortfall to renovate and open the new location. They somehow managed to scrounge the money through an appeal to the community and opened but it must have ruined their financials. At the same time they were opening in other cities. If their financials in the Bay area were shaky (as they admit in their closing statement on their website) then it is not clear why they were taking on more risk by expanding.
- _JamesA_ 9y ago
  The Austin location [1] was close to Dell's Round Rock campus but it seems most of the maker activities I hear about are in Central or South Austin 15+ miles away. [1]: https://goo.gl/maps/39QQvxgc3f32 https://goo.gl/maps/39QQvxgc3f32
- URSpider94 9y ago
  They had no choice but to expand. They had a fairly large corporate office, which needed income from a lot of sites to cover the overhead. I was thinking about investing and got a good look at the financials - only the three Bay Area shops were profitable. Bottom line, they overestimated how many makers out there are willing to pay $150 per month to support their laser cutter habit.
  - Animats 9y ago
    The three Bay Area shops were all profitable? Then someone may buy at least one of them.
    - icantdrive55 9y ago
      Usually the Bankruptcy Refree hires really shady resellers. Those machines will be pieced out--down to the coffee maker. Tip to those buying; find the guy in the back, barking orders at temp liquidators, with a hint of a Martinni on his breath, and quietly ask him about deals. Make sure he knows you have cash. I have always found bankruptcy sales depressing.
    - URSpider94 9y ago
      I have a fantasy that someone like Google or Facebook, or even a wealthy angel, might be willing to buy all three. If you got them out from under their debt obligations and removed the need to support a corporate HQ, I think it would be do-able. @dang - YC should buy them!!!
  - viewtransform 9y ago
    Could you reveal whether the Bay Area shops were borderline profitable or operating with decent margins ? I was surprised that they managed to stay open for more than a decade and assumed that they had figured out a decent sustainable business model.
    - URSpider94 9y ago
      It's been a little while, my recollection is that they were narrowly cash-flow profitable, but I don't recall at this point whether that included debt service, and this is before they took on a ton of debt to relocate the San Jose facility. I'm pretty sure if they can get rid of all of their debt, they would make a little bit of cash. But not enough to justify their billing as a start-up. The other looming issue is that a lot of the equipment at the Bay Area sites is, er, well-loved, and will need to be replaced over the next few years, which is a major capital expense. At the Redwood City shop, the laser cutters are all getting pretty run-down.
    - bagels 9y ago
      San Francisco and Mid-Peninsula were break even (as of 2015). The rest, including San Jose were hemorrhaging money.
      - cr0sh 9y ago
        I'm kinda surprised to think that about the "Phoenix" (Chandler) location; they were essentially "given" the building they used by the city; it was also a shared space with some portion of ASU (IIRC). I wonder what will happen with that ASU program (I think it was part of the engineering school)? I wonder if they will simply take over the space and continue using it (though probably closed to the public)?
RickS 9y ago
Really tragic. I toured their SF facilities and was really impressed with the seriousness of their equipment. Definitely a huge leap above the average maker shop. Ultimately the high price wasn't what held me back from joining, but the tool use policies required by their insurers. You had to pay for a brutally waitlisted class before they'd let you use so much as a laser cutter. I wonder how much this contributed - both the cost of insurance and its consequences - to their decline.
- ars 9y ago
  Same here. I didn't join because of those training classes - it was just too much money, and too much hassle.
- peller 9y ago
  > You had to pay for a brutally waitlisted class For better or worse, that's been the model at every makerspace I've been a member of/looked into. And I think it makes sense, insurance-mandated or not. Lots of expensive, potentially dangerous machinery that if used wrong can destroy itself, its user, and/or those nearby. Also, in my experience once you've built up enough trust with the admins they'll let you get a crash course from a member who knows what's up and skip the fees and formal training process.
  - williamscales 9y ago
    I think that the "brutally waitlisted" part could be addressed. Or you could cap membership until you can actually accommodate the new members. But both those options reduce short term cash inflow.
    - peller 9y ago
      Yea, for sure. I suppose that could either be a staffing problem, or demand outstripping (tool time) supply. In the latter case - if there was space/power available - perhaps they could have gotten a second tool. Or from an economics perspective, raise the rates until the demand cooled off a bit. (Of course that kinda sucks as a member, but it also sucks if you're paying and can't get access time to use the tools you want, so it's a bit of a balancing act)
CalChris 9y ago
I frequented the Redwood City location but bailed after the expansion. Or rather, I bailed after everyone else who I mooched knowledge off of bailed. Still, it was great while it lasted. Ace Monster Toys is similar in the East Bay. https://www.acemonstertoys.org/ https://www.acemonstertoys.org/
- ek750 9y ago
  Nice, I hadn't heard of this place before, but a little far for me. I was actually looking at techshop and planning on going there since I had some small projects I wanted to do. I'm on the peninsula, is there something similar in this area?
emeraldd 9y ago
There was a location near me, but I could never justify spending that much money on something I'd use for a a day or two a month. Between commutes during the week and traveling on weekends there would never have been time to make it worthwhile. Sad to see them go under though.
- cellularmitosis 9y ago
  You hit on what I suspect is a missed opportunity on their part. There are a lot of businesses which seem to be thriving on the “too cheap to bother canceling even though I stopped using it” idea, like the $10 gym memberships you see. Perhaps they could have come up with a drastically price reduced membership which only allowed for a couple of days of use per month? It would have eaten into some of their full memberships, but I suspect they could have dramatically grown their membership in that fashion.
ironchef253 9y ago
People really decided to hate Peter Thiel during the last election. But he is right about the fact that you can’t do anything in the physical world in the United States anymore. Between housing and real estate prices, insurance, taxes, lack of government support, environmental protections, requirement to pay for health insurance for employees,layers of regulations, minimum wage laws, sexual harassment lawsuits (it only takes one and your company is over)...you just can’t operate a physical space with drills, laser cutters, saws, advanced electronics and machinery at a profit in America anymore. TechShop was the last gasp of American industry having any sort of future. With Tech Shop, we can also probably say good bye to a good deal of real trade skills people learn at these locations. They really tried to make it work. I have spoken to some of their founders myself - The amount of work it takes to set up even one of these facilities is simply staggering. If I were to show you the spreadsheets, business plans and research these guys invest to open ONE shop it genuinely rivals that of a full startup per location. My heart really breaks. There are a few companies able to survive with physical presences like this in the Bay Area now, but they are all backed by the power of Jabil, Flextronics, Autodesk. Some small indie chain can’t make it in these conditions. Unfortunately, we can expect more of this as a country. We are one recession away from a full republican route (they are doing a spectacularly awful job and deserve to be thrown out) and all signs are pointing to a fully socialist government being next in line. Socialist governments are not known for their desire to roll back worker protections, undo environmental protections and regulations, nor is their focus on enabling businesses. Although I will say Canada seems to be doing better than us in many ways when it comes to accelerating genuinely valuable little companies like TechShop. I am genuinely beginning to advise people to consider moving to Asia where innovation is able to happen, it won’t be done in a America anytime soon. Between Trump and his socialist successor - and the wonderful incompetent state of California I don’t have a good feeling about American innovation anymore.
- deleted 9y ago
  [deleted]
- Taniwha 9y ago
  You know I suspect there's going to be a whole lot of cool tools cheap on the market real soon now ... go out there and start your own, don't complain because someone else isn't
uncletammy 9y ago
They informed employees of the shutdown as they were firing them. This was a few days AFTER they revoked the employees insurance benefits without notice or explanation. Those same employees were also told that they're unlikely to get their final paycheck. As for me, I was suckered into pre-paying for $500 worth of classes that I'll never be reimbursed for. So many people who's livelihoods depended on their facilities were completely blindsided. Members who had been there for years were told they had hours to remove their belongings or they would be confiscated. The whole thing is a complete mess. All of this just a few weeks after opening a brand new location in Brooklyn. I simply can't comprehend the level of negligence and mismanagement here.
- seattle_spring 9y ago
  > I was suckered into pre-paying for $500 worth of classes that I'll never be reimbursed for. Did you pay with a CC? I would dispute the charges.
  - chipperyman573 9y ago
    What could you dispute? You authorized the charges and received what you paid for (classes). That said, training (unless it's useful outside the job) must be paid for by the employer. For example a pool can require CPR training for their lifeguards because you can use that outside being a lifeguard, but Starbucks can't require you to pay for their class because knowing how to make a starbucks drink is too specific.
    - kylegordon 9y ago
      > I was suckered into pre-paying for $500 worth of classes that I'll never be reimbursed for. "pre-paying". He paid in advance, and the classes will now not be going ahead.
    - downandout 9y ago
      He didn't receive the classes he paid for, and yes, he can and should charge it back on that basis. You generally have 180 days to charge it back, so as long as the charge was within this time frame, his bank should reimburse him. They'll try to suck the money out of TechShop's bank account, and if the money isn't in their account, their merchant provider will become another creditor in the bankruptcy proceeding for the total amount of chargebacks.
danshapiro 9y ago
This is just terrible. We need more, not less, access to tools in our society. We joined with a few other startups to offer something to the members who were affected. glowforge.com/techshop
swimfar 9y ago
Previous discussion: https://news.ycombinator.com/item?id=15705072 https://news.ycombinator.com/item?id=15705072
nwatson 9y ago
I belonged to the Redwood City TechShop for a year and was surprised five years ago seeing a TechShop planned for Raleigh, NC when we were thinking of moving to RTP. I'm not sure that it ever opened, it didn't last long. We ended up in Winston-Salem, NC instead, and I look forward to checking on Mixxer when it opens, $550/year, https://wsmixxer.org/ https://wsmixxer.org/. Winston-Salem has a big arts community, might be an interesting place.
- grmarcil 9y ago
  I was a member at TechShop RDU for a couple years. It started as an independent makerspace, got acquired by TechShop in 2011, then closed in 2013. It was a really cool place and I miss it. A lot of interesting characters there. As others have said in this thread, I think TS had a tough value proposition to build a business model around. Classes were a pain and a fairly big start-up cost for new members, but inevitable to satisfy insurance requirements. The monthly membership fee was fairly cheap considering the awesome equipment they had, but expensive if you could only manage to go a few days a month. Plus whatever storage fees for larger projects and/or the hassle of carting your stuff around. On top of that, management at both locations I used (RDU and Arlington) seemed a bit chaotic. Sad to see them go out of business either way.
whyenot 9y ago
What a shame. There was one right next to the San Jose State University campus. They were forced to move when construction on new private student housing began where their building had been located. After a lot of hardship and pleas for donations they had just finished moving into a new location right on 2nd street in the middle of downtown. video featuring many of the regulars at the SJ location https://youtu.be/vYBivF3YNlg https://youtu.be/vYBivF3YNlg
cellularmitosis 9y ago
I was a member of Austin’s TechShop for two years. It was interesting contrasting it to the ATX Hackerspace. The hackerspace (a few years back, anyway) was much better at building a community. The fee was only $35/mo, and they had a starving student discount, and you were also free to invite your friends to tag along. As a result, there were always people just hanging out at the hackerspace. A lot of near-college-age space cadets and techno-dreamers, and they’d be there all day. You could go there to work on a project, or just to mooch off of the conversation. TechShop never developed a community. It felt sterile in comparison. The fees were more like $125/mo (at the time, and only went up from there). There was no central area to hang out in and chat. And inviting a friend along cost something like $20. These conditions resulted in the demographic becoming more like a bunch of upper middle class dudes who managed to get a few hours away from the fam to work on their project. There was no social core, it never became a hang-out. There were also some financial issues which really turned me off. I had spent about $1500 on classes early on (thinking I’d just get signed off on all of the machines asap so that I was free to work on anything), but I later found out that if you didn’t badge into a machine for over 12 months, your credential for that machine expired and you had to pay to take the class again. Boom, easily $1000 down the drain. By the time they started hiking up their membership prices, I was disillusioned and declined to renew.
- kbart 9y ago
  To each his own I guess, but socializing and constant noise around when others are socializing is the main thing I hate about hacker spaces. I would gladly pay extra to have a "sterile" workplace for my projects.
  - IshKebab 9y ago
    Yeah if sterile means people don't leave shit around everywhere and dump their unwanted junk in case someone wants it then sign me up. On the other hand it sounds like the safety paranoia (have you been inducted to use this hacksaw?) is even worse than at hackspaces.
    - 9y ago
typetehcodez 9y ago
Wow. I'm speachless. I remember when Obama visited the TechShop near me in Pittsburgh. This was supposed to be the next big thing! The harbinger into the Uberization of the workforce. What a bummer and major dissapointment. I met with the staff there numerous times; they were fantistic people - well educated and helpful. This is just so dissapointing. There are quite a few makerspaces and hackerspaces in Pittsburgh. I hope this doesn't spell the end of this movement.
dheera 9y ago
Pragmatic question: what are the alternatives in the Bay Area that are available to me right now? I'm most interested in having access to a laser cutter, mill, and lathe.
- shriphani 9y ago
  dheera, I was in the same boat - hacker dojo has at least one of those things. There's a "techshop orphans" group on facebook coordinating things right now for ex members/employees. Civilization has successfully wiped out yet another source of small joys for folk. But we endure and continue making.
- jimmywanger 9y ago
  Most community colleges. If you develop a good relationship with the prof, he'll let you run a mill. Take a class or two, and see how far it gets your. They are usually pretty cool.
  - convolvatron 9y ago
    it seems really sad that these longstanding resources don't get as much attention in the maker community as they should. the teaching staff is usually super experienced and helpful, the costs are priced to allow people to get themselves into regular blue collar work. most importantly for me they are trying to train you to be a professional craftsman, not just getting you to the minimum level that you can show up once a month and mess around and probably not hurt yourself. ccsf welding courses are vastly more useful and 1/4 the cost of a crucible course
    - VLM 9y ago
      There's a political angle or herd mentality that makes it hard to go to CC. If you can get past it, they are great places for an individual to learn, but if the social or social media stuff is a significant fraction of being in the makerspace, then its not going to work.
      - 9y ago
twblalock 9y ago
I hate to be the guy who says he saw this coming, but I doubt I'm the only one who did. Renting out prime real estate in downtown areas, buying very expensive tools and machinery, and letting people use them for a very small percentage of the cost? Not a good business model.
- scurvy 9y ago
  It wasn't always prime real estate. In San Jose, they were on 2nd Street, which is a no man's land due to high crime. They got lots of concessions from the city to go there, but still couldn't make it.
- clavalle 9y ago
  I felt the same way when I toured the Austin Techshop. They touted some hugely expensive machine and I was thinking 'How many people need to cut an 8 inch block of marble with precision?' Honestly, I think a similar concept would work with much more basic equipment. The various Hackerspaces seem like a good bet.
robbyt 9y ago
The Brooklyn location just opened two weeks ago. Its fully stocked, and most of the equipment has never been used. What a waste!
yeswecatan 9y ago
For those of you in SF, you should look into Noisebridge. They don't have nearly as many tools or machines as TechShop, but they have a lot and it's all free.
- hackcasual 9y ago
  Noisebridge is a cultural institution in and of itself. Such an amazing space to spend time in
gaze 9y ago
Eh good riddance. I recall encountering a litany of safety issues at their first location. For instance... a properly set up machine shop has the milling machines placed in the corners of the room, and the remainder with shields around them. This is so that if a part is improperly fixtured, the part won't be shot out of the vice at a neighboring operator. When a certain mill made a terrible noise at the speed I needed to operate it at, I was told to crank the speed up until the noise went away. This is when the location was run by the core group of people who started it... and thus I'm not surprised that it was mismanaged at scale as it grew.
jimktrains2 9y ago
I could never justify joining the Pittsburgh one when it was open. I did visit a few times and always felt like they had too many employees and too much space for what they were. They also chose one of the most expensive places to rent in a city filled with affordable real estate.
sschueller 9y ago
These kind of facilities should be paid for by tax dollars (which they are in other countries). They provide a needed place for people to tinker and learn which is beneficial to the community overall.
ptero 9y ago
I suspect there is still a business model there. When I was looking for access to machine shop tools in Boston area (I primarily needed a good accuracy CNC mill) I found nothing that worked for me. Best match was a "maker space" with a mess inside, 4 machines 2 of which were broken (including their one CNC) and remaining two looking suspicious. How can I use machines? Take a class after sign up. When is the next class? Not sure, in a few months maybe; they fill quick, too, so keep checking often. The attitude of an admin I checked with was "get lost, we have enough members already". I finally found what I needed at a university hobby shop: working machines, busy but good access to tools, efficient admins. To get CNC access I needed 2 short classes that I could both schedule within 2 weeks. Before I found that though I would gladly pay higher membership fees for a clean, efficient machine shop access. Just my 2c.
- sfifs 9y ago
  Market size would be a challenge. You likely represent a very niche segment - a highly technically savvy hobbyist who wants to work on tools yourself for the love of it. For anyone doing requiring 3D printing, CNC etc professionally or even as a semi serious hobby, I'm sure there would be firms who can execute and fedex you the job. Here in Singapore when I moved into our apartment, I ended up having to design a custom child safety lock for my windows. I found quite a few 3D print shops which could deliver the next day at quite a reasonable rate - fast enough for me to iterate the final design within a week.
  - ptero 9y ago
    > Market size would be a challenge. Possibly, but I am not sure about this. When I was looking (about 5-7 yrs ago, US, Boston area) there were two types: cheap and nonfunctional beyond toys or "we run your jobs for you". First type, as they are cheap, have no interest in new members building things; in fact, as the membership is so cheap they try to sell all sorts of overpriced classes as memberships do not cover costs. At the other end there are those who take your design and ship you the product, as you said. This is OK for many cases, but gets pretty expensive and inefficient for prototyping. And there was nothing in between to fill this wide gap. In fact, when I was looking for such a shop and asked friends if they know a place that would let me pay membership to use a decent quality 3+ axis CNC mill and a laser cutter no one knew of a place but several said if I found one, would I please let them know. So I suspect the market is there. The situation is much better with 3D printing -- there are small shops everywhere and some could even let you come inside and iterate if you chat with owners. However, inexpensive 3D printing is nowhere near the accuracy, reliability and robustness of the end product you get with inexpensive milling.
replicatorblog 9y ago
More broadly, it's kind of sad how little actually came of the "Maker Movement," at least in terms of startups. MakerBot sold for $400M and there are plenty of small 3-D printer companies targeted at hobbyists. Ponoko and Shapeways are solid if unspectacular. Arduino and Raspberry Pi are both solid projects, AdaFruit and Sparkfun are solid businesses. Make: Magazine is cool, but still a niche publication. Of course, startups aren't the only measure of success. The net positive is hundreds of thousands, maybe millions of younger hackers who may go on to build the next hardware company based on lessons learned at a MakerFaire.
- radiorental 9y ago
  > More broadly, it's kind of sad how little actually came of the "Maker Movement" I'm not sure I agree. However I do believe the "Maker" movement was over sold by O'Reilly media and Dale Dougherty in particular. I stopped subscribing to Make Magazine few years back when it became apparent it was little more than a print version of Hackaday or Instructables. Regardless of Maker. There is a plethora Robotics Competitions, existing Hacker spaces and STEM is huge. The number of kids that were going to tinker at home is a fairly fixed. Where we'll really move the needle in terms of more people getting into engineering is in formal education (inc Robotics competitions). Disclosure: I'm a little biased, I help design and build IDE's for some of these comps, e.g. http://zerorobotics.mit.edu/what-is-zr/ http://zerorobotics.mit.edu/what-is-zr/ but I also have advocated and help implement "maker spaces" in my local school system. There is a sea-change, so I'll push back on the idea that little came of the 'maker movement'
  - replicatorblog 9y ago
    I totally agree — There was just this point where the Economist and other general interest publications were covering it like the 3rd industrial revolution. More robot clubs are great, but it's hard to think of a single billion dollar company that came out of it.
    - bagels 9y ago
      I don't credit Techshop for any of this success, but lore had it that Square built their prototype at Techshop.
cr0sh 9y ago
This is rather unexpected and surprising to me. I wonder what it was about the business model that just didn't work? When they opened the Chandler location here in the Phoenix area, I quickly signed up for a year's membership, but that turned out to be a mistake. I certainly didn't get my money's worth, but the mistake was on my end, not theirs: They were located in the east valley (where it seems all the cool kids are), and I live in the west valley; it was a good 100 mile drive round-trip for me to go there. I hardly ever went as a result, and the membership was wasted. The space itself was amazing otherwise; had it been closer to my home I am sure I would have used it more often than I did for the tools I didn't otherwise have at home (like the laser cutters, for instance). I was always impressed how they had workshops for just about everything you needed to take an idea from a concept (CAD/design) to finished prototype. There more more than a few startups that got their start at TechShop; one of the more famous examples was Square (they prototyped the original swipe reader thru TechShop). I am now wondering what, if anything, this says (or what effects it will have) about other maker and hackerspaces. We don't really have very many in the Valley. For myself, I'll just continue doing what I've always done, and work from home or over at my friend's shop.
Animats 9y ago
Update: the founder of Square is re-opening the St. Louis location.[1] The Deputy City Manager of San Jose has his staff looking into what to do about the San Jose location.[2] There's a good chance San Jose and the Downtown Development Association will make something happen. They're very aggressive in building up downtown San Jose. In 2008, it was almost totally empty, and they want startups to locate there. [1] http://www.stltoday.com/business/local/inventors-take-heart-st-louis-entrepreneur-will-reopen-maker-space/article_31d842e2-4637-5948-b7d7-1f0b963554de.html http://www.stltoday.com/business/local/inventors-take-heart-... [2] http://www.mercurynews.com/2017/11/16/rip-techshop-san-jose-what-comes-next/ http://www.mercurynews.com/2017/11/16/rip-techshop-san-jose-...
Animats 9y ago
Discussions elsewhere concerning TechShop revival are on Facebook [1] and on Slack (somewhere). [1] https://www.facebook.com/groups/128112754534676/ https://www.facebook.com/groups/128112754534676/

214 points by wizardforhire 9y ago

At the Redwood city location there were many artists and small businesses that depended on the facilities. It will be a big blow to them. I think they got reckless with their expansion. The San Jose location moved to a new location after their lease expired. They chose to relocate to a prime location in downtown San Jose and ended up with a million dollar shortfall to renovate and open the new location. They somehow managed to scrounge the money through an appeal to the community and opened but it must have ruined their financials. At the same time they were opening in other cities. If their financials in the Bay area were shaky (as they admit in their closing statement on their website) then it is not clear why they were taking on more risk by expanding.

_JamesA_ 9y ago
The Austin location [1] was close to Dell's Round Rock campus but it seems most of the maker activities I hear about are in Central or South Austin 15+ miles away. [1]: https://goo.gl/maps/39QQvxgc3f32 https://goo.gl/maps/39QQvxgc3f32
URSpider94 9y ago
They had no choice but to expand. They had a fairly large corporate office, which needed income from a lot of sites to cover the overhead. I was thinking about investing and got a good look at the financials - only the three Bay Area shops were profitable. Bottom line, they overestimated how many makers out there are willing to pay $150 per month to support their laser cutter habit.
- Animats 9y ago
  The three Bay Area shops were all profitable? Then someone may buy at least one of them.
  - icantdrive55 9y ago
    Usually the Bankruptcy Refree hires really shady resellers. Those machines will be pieced out--down to the coffee maker. Tip to those buying; find the guy in the back, barking orders at temp liquidators, with a hint of a Martinni on his breath, and quietly ask him about deals. Make sure he knows you have cash. I have always found bankruptcy sales depressing.
  - URSpider94 9y ago
    I have a fantasy that someone like Google or Facebook, or even a wealthy angel, might be willing to buy all three. If you got them out from under their debt obligations and removed the need to support a corporate HQ, I think it would be do-able. @dang - YC should buy them!!!
- viewtransform 9y ago
  Could you reveal whether the Bay Area shops were borderline profitable or operating with decent margins ? I was surprised that they managed to stay open for more than a decade and assumed that they had figured out a decent sustainable business model.
  - URSpider94 9y ago
    It's been a little while, my recollection is that they were narrowly cash-flow profitable, but I don't recall at this point whether that included debt service, and this is before they took on a ton of debt to relocate the San Jose facility. I'm pretty sure if they can get rid of all of their debt, they would make a little bit of cash. But not enough to justify their billing as a start-up. The other looming issue is that a lot of the equipment at the Bay Area sites is, er, well-loved, and will need to be replaced over the next few years, which is a major capital expense. At the Redwood City shop, the laser cutters are all getting pretty run-down.
  - bagels 9y ago
    San Francisco and Mid-Peninsula were break even (as of 2015). The rest, including San Jose were hemorrhaging money.
    - cr0sh 9y ago
      I'm kinda surprised to think that about the "Phoenix" (Chandler) location; they were essentially "given" the building they used by the city; it was also a shared space with some portion of ASU (IIRC). I wonder what will happen with that ASU program (I think it was part of the engineering school)? I wonder if they will simply take over the space and continue using it (though probably closed to the public)?

RickS 9y ago

Really tragic. I toured their SF facilities and was really impressed with the seriousness of their equipment. Definitely a huge leap above the average maker shop. Ultimately the high price wasn't what held me back from joining, but the tool use policies required by their insurers. You had to pay for a brutally waitlisted class before they'd let you use so much as a laser cutter. I wonder how much this contributed - both the cost of insurance and its consequences - to their decline.

ars 9y ago
Same here. I didn't join because of those training classes - it was just too much money, and too much hassle.
peller 9y ago
> You had to pay for a brutally waitlisted class For better or worse, that's been the model at every makerspace I've been a member of/looked into. And I think it makes sense, insurance-mandated or not. Lots of expensive, potentially dangerous machinery that if used wrong can destroy itself, its user, and/or those nearby. Also, in my experience once you've built up enough trust with the admins they'll let you get a crash course from a member who knows what's up and skip the fees and formal training process.
- williamscales 9y ago
  I think that the "brutally waitlisted" part could be addressed. Or you could cap membership until you can actually accommodate the new members. But both those options reduce short term cash inflow.
  - peller 9y ago
    Yea, for sure. I suppose that could either be a staffing problem, or demand outstripping (tool time) supply. In the latter case - if there was space/power available - perhaps they could have gotten a second tool. Or from an economics perspective, raise the rates until the demand cooled off a bit. (Of course that kinda sucks as a member, but it also sucks if you're paying and can't get access time to use the tools you want, so it's a bit of a balancing act)

CalChris 9y ago

I frequented the Redwood City location but bailed after the expansion. Or rather, I bailed after everyone else who I mooched knowledge off of bailed. Still, it was great while it lasted. Ace Monster Toys is similar in the East Bay. https://www.acemonstertoys.org/ https://www.acemonstertoys.org/

ek750 9y ago
Nice, I hadn't heard of this place before, but a little far for me. I was actually looking at techshop and planning on going there since I had some small projects I wanted to do. I'm on the peninsula, is there something similar in this area?

emeraldd 9y ago

There was a location near me, but I could never justify spending that much money on something I'd use for a a day or two a month. Between commutes during the week and traveling on weekends there would never have been time to make it worthwhile. Sad to see them go under though.

cellularmitosis 9y ago
You hit on what I suspect is a missed opportunity on their part. There are a lot of businesses which seem to be thriving on the “too cheap to bother canceling even though I stopped using it” idea, like the $10 gym memberships you see. Perhaps they could have come up with a drastically price reduced membership which only allowed for a couple of days of use per month? It would have eaten into some of their full memberships, but I suspect they could have dramatically grown their membership in that fashion.

ironchef253 9y ago

People really decided to hate Peter Thiel during the last election. But he is right about the fact that you can’t do anything in the physical world in the United States anymore. Between housing and real estate prices, insurance, taxes, lack of government support, environmental protections, requirement to pay for health insurance for employees,layers of regulations, minimum wage laws, sexual harassment lawsuits (it only takes one and your company is over)...you just can’t operate a physical space with drills, laser cutters, saws, advanced electronics and machinery at a profit in America anymore. TechShop was the last gasp of American industry having any sort of future. With Tech Shop, we can also probably say good bye to a good deal of real trade skills people learn at these locations. They really tried to make it work. I have spoken to some of their founders myself - The amount of work it takes to set up even one of these facilities is simply staggering. If I were to show you the spreadsheets, business plans and research these guys invest to open ONE shop it genuinely rivals that of a full startup per location. My heart really breaks. There are a few companies able to survive with physical presences like this in the Bay Area now, but they are all backed by the power of Jabil, Flextronics, Autodesk. Some small indie chain can’t make it in these conditions. Unfortunately, we can expect more of this as a country. We are one recession away from a full republican route (they are doing a spectacularly awful job and deserve to be thrown out) and all signs are pointing to a fully socialist government being next in line. Socialist governments are not known for their desire to roll back worker protections, undo environmental protections and regulations, nor is their focus on enabling businesses. Although I will say Canada seems to be doing better than us in many ways when it comes to accelerating genuinely valuable little companies like TechShop. I am genuinely beginning to advise people to consider moving to Asia where innovation is able to happen, it won’t be done in a America anytime soon. Between Trump and his socialist successor - and the wonderful incompetent state of California I don’t have a good feeling about American innovation anymore.

deleted 9y ago
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Taniwha 9y ago
You know I suspect there's going to be a whole lot of cool tools cheap on the market real soon now ... go out there and start your own, don't complain because someone else isn't

uncletammy 9y ago

They informed employees of the shutdown as they were firing them. This was a few days AFTER they revoked the employees insurance benefits without notice or explanation. Those same employees were also told that they're unlikely to get their final paycheck. As for me, I was suckered into pre-paying for $500 worth of classes that I'll never be reimbursed for. So many people who's livelihoods depended on their facilities were completely blindsided. Members who had been there for years were told they had hours to remove their belongings or they would be confiscated. The whole thing is a complete mess. All of this just a few weeks after opening a brand new location in Brooklyn. I simply can't comprehend the level of negligence and mismanagement here.

seattle_spring 9y ago
> I was suckered into pre-paying for $500 worth of classes that I'll never be reimbursed for. Did you pay with a CC? I would dispute the charges.
- chipperyman573 9y ago
  What could you dispute? You authorized the charges and received what you paid for (classes). That said, training (unless it's useful outside the job) must be paid for by the employer. For example a pool can require CPR training for their lifeguards because you can use that outside being a lifeguard, but Starbucks can't require you to pay for their class because knowing how to make a starbucks drink is too specific.
  - kylegordon 9y ago
    > I was suckered into pre-paying for $500 worth of classes that I'll never be reimbursed for. "pre-paying". He paid in advance, and the classes will now not be going ahead.
  - downandout 9y ago
    He didn't receive the classes he paid for, and yes, he can and should charge it back on that basis. You generally have 180 days to charge it back, so as long as the charge was within this time frame, his bank should reimburse him. They'll try to suck the money out of TechShop's bank account, and if the money isn't in their account, their merchant provider will become another creditor in the bankruptcy proceeding for the total amount of chargebacks.

danshapiro 9y ago

This is just terrible. We need more, not less, access to tools in our society. We joined with a few other startups to offer something to the members who were affected. glowforge.com/techshop

swimfar 9y ago

Previous discussion: https://news.ycombinator.com/item?id=15705072 https://news.ycombinator.com/item?id=15705072

nwatson 9y ago

I belonged to the Redwood City TechShop for a year and was surprised five years ago seeing a TechShop planned for Raleigh, NC when we were thinking of moving to RTP. I'm not sure that it ever opened, it didn't last long. We ended up in Winston-Salem, NC instead, and I look forward to checking on Mixxer when it opens, $550/year, https://wsmixxer.org/ https://wsmixxer.org/. Winston-Salem has a big arts community, might be an interesting place.

grmarcil 9y ago
I was a member at TechShop RDU for a couple years. It started as an independent makerspace, got acquired by TechShop in 2011, then closed in 2013. It was a really cool place and I miss it. A lot of interesting characters there. As others have said in this thread, I think TS had a tough value proposition to build a business model around. Classes were a pain and a fairly big start-up cost for new members, but inevitable to satisfy insurance requirements. The monthly membership fee was fairly cheap considering the awesome equipment they had, but expensive if you could only manage to go a few days a month. Plus whatever storage fees for larger projects and/or the hassle of carting your stuff around. On top of that, management at both locations I used (RDU and Arlington) seemed a bit chaotic. Sad to see them go out of business either way.

whyenot 9y ago

What a shame. There was one right next to the San Jose State University campus. They were forced to move when construction on new private student housing began where their building had been located. After a lot of hardship and pleas for donations they had just finished moving into a new location right on 2nd street in the middle of downtown. video featuring many of the regulars at the SJ location https://youtu.be/vYBivF3YNlg https://youtu.be/vYBivF3YNlg

cellularmitosis 9y ago

I was a member of Austin’s TechShop for two years. It was interesting contrasting it to the ATX Hackerspace. The hackerspace (a few years back, anyway) was much better at building a community. The fee was only $35/mo, and they had a starving student discount, and you were also free to invite your friends to tag along. As a result, there were always people just hanging out at the hackerspace. A lot of near-college-age space cadets and techno-dreamers, and they’d be there all day. You could go there to work on a project, or just to mooch off of the conversation. TechShop never developed a community. It felt sterile in comparison. The fees were more like $125/mo (at the time, and only went up from there). There was no central area to hang out in and chat. And inviting a friend along cost something like $20. These conditions resulted in the demographic becoming more like a bunch of upper middle class dudes who managed to get a few hours away from the fam to work on their project. There was no social core, it never became a hang-out. There were also some financial issues which really turned me off. I had spent about $1500 on classes early on (thinking I’d just get signed off on all of the machines asap so that I was free to work on anything), but I later found out that if you didn’t badge into a machine for over 12 months, your credential for that machine expired and you had to pay to take the class again. Boom, easily $1000 down the drain. By the time they started hiking up their membership prices, I was disillusioned and declined to renew.

kbart 9y ago
To each his own I guess, but socializing and constant noise around when others are socializing is the main thing I hate about hacker spaces. I would gladly pay extra to have a "sterile" workplace for my projects.
- IshKebab 9y ago
  Yeah if sterile means people don't leave shit around everywhere and dump their unwanted junk in case someone wants it then sign me up. On the other hand it sounds like the safety paranoia (have you been inducted to use this hacksaw?) is even worse than at hackspaces.
  - 9y ago

typetehcodez 9y ago

Wow. I'm speachless. I remember when Obama visited the TechShop near me in Pittsburgh. This was supposed to be the next big thing! The harbinger into the Uberization of the workforce. What a bummer and major dissapointment. I met with the staff there numerous times; they were fantistic people - well educated and helpful. This is just so dissapointing. There are quite a few makerspaces and hackerspaces in Pittsburgh. I hope this doesn't spell the end of this movement.

dheera 9y ago

Pragmatic question: what are the alternatives in the Bay Area that are available to me right now? I'm most interested in having access to a laser cutter, mill, and lathe.

shriphani 9y ago
dheera, I was in the same boat - hacker dojo has at least one of those things. There's a "techshop orphans" group on facebook coordinating things right now for ex members/employees. Civilization has successfully wiped out yet another source of small joys for folk. But we endure and continue making.
jimmywanger 9y ago
Most community colleges. If you develop a good relationship with the prof, he'll let you run a mill. Take a class or two, and see how far it gets your. They are usually pretty cool.
- convolvatron 9y ago
  it seems really sad that these longstanding resources don't get as much attention in the maker community as they should. the teaching staff is usually super experienced and helpful, the costs are priced to allow people to get themselves into regular blue collar work. most importantly for me they are trying to train you to be a professional craftsman, not just getting you to the minimum level that you can show up once a month and mess around and probably not hurt yourself. ccsf welding courses are vastly more useful and 1/4 the cost of a crucible course
  - VLM 9y ago
    There's a political angle or herd mentality that makes it hard to go to CC. If you can get past it, they are great places for an individual to learn, but if the social or social media stuff is a significant fraction of being in the makerspace, then its not going to work.
    - 9y ago

twblalock 9y ago

I hate to be the guy who says he saw this coming, but I doubt I'm the only one who did. Renting out prime real estate in downtown areas, buying very expensive tools and machinery, and letting people use them for a very small percentage of the cost? Not a good business model.

scurvy 9y ago
It wasn't always prime real estate. In San Jose, they were on 2nd Street, which is a no man's land due to high crime. They got lots of concessions from the city to go there, but still couldn't make it.
clavalle 9y ago
I felt the same way when I toured the Austin Techshop. They touted some hugely expensive machine and I was thinking 'How many people need to cut an 8 inch block of marble with precision?' Honestly, I think a similar concept would work with much more basic equipment. The various Hackerspaces seem like a good bet.

robbyt 9y ago

The Brooklyn location just opened two weeks ago. Its fully stocked, and most of the equipment has never been used. What a waste!

yeswecatan 9y ago

For those of you in SF, you should look into Noisebridge. They don't have nearly as many tools or machines as TechShop, but they have a lot and it's all free.

hackcasual 9y ago
Noisebridge is a cultural institution in and of itself. Such an amazing space to spend time in

gaze 9y ago

Eh good riddance. I recall encountering a litany of safety issues at their first location. For instance... a properly set up machine shop has the milling machines placed in the corners of the room, and the remainder with shields around them. This is so that if a part is improperly fixtured, the part won't be shot out of the vice at a neighboring operator. When a certain mill made a terrible noise at the speed I needed to operate it at, I was told to crank the speed up until the noise went away. This is when the location was run by the core group of people who started it... and thus I'm not surprised that it was mismanaged at scale as it grew.

jimktrains2 9y ago

I could never justify joining the Pittsburgh one when it was open. I did visit a few times and always felt like they had too many employees and too much space for what they were. They also chose one of the most expensive places to rent in a city filled with affordable real estate.

sschueller 9y ago

These kind of facilities should be paid for by tax dollars (which they are in other countries). They provide a needed place for people to tinker and learn which is beneficial to the community overall.

ptero 9y ago

I suspect there is still a business model there. When I was looking for access to machine shop tools in Boston area (I primarily needed a good accuracy CNC mill) I found nothing that worked for me. Best match was a "maker space" with a mess inside, 4 machines 2 of which were broken (including their one CNC) and remaining two looking suspicious. How can I use machines? Take a class after sign up. When is the next class? Not sure, in a few months maybe; they fill quick, too, so keep checking often. The attitude of an admin I checked with was "get lost, we have enough members already". I finally found what I needed at a university hobby shop: working machines, busy but good access to tools, efficient admins. To get CNC access I needed 2 short classes that I could both schedule within 2 weeks. Before I found that though I would gladly pay higher membership fees for a clean, efficient machine shop access. Just my 2c.

sfifs 9y ago
Market size would be a challenge. You likely represent a very niche segment - a highly technically savvy hobbyist who wants to work on tools yourself for the love of it. For anyone doing requiring 3D printing, CNC etc professionally or even as a semi serious hobby, I'm sure there would be firms who can execute and fedex you the job. Here in Singapore when I moved into our apartment, I ended up having to design a custom child safety lock for my windows. I found quite a few 3D print shops which could deliver the next day at quite a reasonable rate - fast enough for me to iterate the final design within a week.
- ptero 9y ago
  > Market size would be a challenge. Possibly, but I am not sure about this. When I was looking (about 5-7 yrs ago, US, Boston area) there were two types: cheap and nonfunctional beyond toys or "we run your jobs for you". First type, as they are cheap, have no interest in new members building things; in fact, as the membership is so cheap they try to sell all sorts of overpriced classes as memberships do not cover costs. At the other end there are those who take your design and ship you the product, as you said. This is OK for many cases, but gets pretty expensive and inefficient for prototyping. And there was nothing in between to fill this wide gap. In fact, when I was looking for such a shop and asked friends if they know a place that would let me pay membership to use a decent quality 3+ axis CNC mill and a laser cutter no one knew of a place but several said if I found one, would I please let them know. So I suspect the market is there. The situation is much better with 3D printing -- there are small shops everywhere and some could even let you come inside and iterate if you chat with owners. However, inexpensive 3D printing is nowhere near the accuracy, reliability and robustness of the end product you get with inexpensive milling.

replicatorblog 9y ago

More broadly, it's kind of sad how little actually came of the "Maker Movement," at least in terms of startups. MakerBot sold for $400M and there are plenty of small 3-D printer companies targeted at hobbyists. Ponoko and Shapeways are solid if unspectacular. Arduino and Raspberry Pi are both solid projects, AdaFruit and Sparkfun are solid businesses. Make: Magazine is cool, but still a niche publication. Of course, startups aren't the only measure of success. The net positive is hundreds of thousands, maybe millions of younger hackers who may go on to build the next hardware company based on lessons learned at a MakerFaire.

radiorental 9y ago
> More broadly, it's kind of sad how little actually came of the "Maker Movement" I'm not sure I agree. However I do believe the "Maker" movement was over sold by O'Reilly media and Dale Dougherty in particular. I stopped subscribing to Make Magazine few years back when it became apparent it was little more than a print version of Hackaday or Instructables. Regardless of Maker. There is a plethora Robotics Competitions, existing Hacker spaces and STEM is huge. The number of kids that were going to tinker at home is a fairly fixed. Where we'll really move the needle in terms of more people getting into engineering is in formal education (inc Robotics competitions). Disclosure: I'm a little biased, I help design and build IDE's for some of these comps, e.g. http://zerorobotics.mit.edu/what-is-zr/ http://zerorobotics.mit.edu/what-is-zr/ but I also have advocated and help implement "maker spaces" in my local school system. There is a sea-change, so I'll push back on the idea that little came of the 'maker movement'
- replicatorblog 9y ago
  I totally agree — There was just this point where the Economist and other general interest publications were covering it like the 3rd industrial revolution. More robot clubs are great, but it's hard to think of a single billion dollar company that came out of it.
  - bagels 9y ago
    I don't credit Techshop for any of this success, but lore had it that Square built their prototype at Techshop.

cr0sh 9y ago

This is rather unexpected and surprising to me. I wonder what it was about the business model that just didn't work? When they opened the Chandler location here in the Phoenix area, I quickly signed up for a year's membership, but that turned out to be a mistake. I certainly didn't get my money's worth, but the mistake was on my end, not theirs: They were located in the east valley (where it seems all the cool kids are), and I live in the west valley; it was a good 100 mile drive round-trip for me to go there. I hardly ever went as a result, and the membership was wasted. The space itself was amazing otherwise; had it been closer to my home I am sure I would have used it more often than I did for the tools I didn't otherwise have at home (like the laser cutters, for instance). I was always impressed how they had workshops for just about everything you needed to take an idea from a concept (CAD/design) to finished prototype. There more more than a few startups that got their start at TechShop; one of the more famous examples was Square (they prototyped the original swipe reader thru TechShop). I am now wondering what, if anything, this says (or what effects it will have) about other maker and hackerspaces. We don't really have very many in the Valley. For myself, I'll just continue doing what I've always done, and work from home or over at my friend's shop.

Animats 9y ago

Update: the founder of Square is re-opening the St. Louis location.[1] The Deputy City Manager of San Jose has his staff looking into what to do about the San Jose location.[2] There's a good chance San Jose and the Downtown Development Association will make something happen. They're very aggressive in building up downtown San Jose. In 2008, it was almost totally empty, and they want startups to locate there. [1] http://www.stltoday.com/business/local/inventors-take-heart-st-louis-entrepreneur-will-reopen-maker-space/article_31d842e2-4637-5948-b7d7-1f0b963554de.html http://www.stltoday.com/business/local/inventors-take-heart-... [2] http://www.mercurynews.com/2017/11/16/rip-techshop-san-jose-what-comes-next/ http://www.mercurynews.com/2017/11/16/rip-techshop-san-jose-...

Animats 9y ago

Discussions elsewhere concerning TechShop revival are on Facebook [1] and on Slack (somewhere). [1] https://www.facebook.com/groups/128112754534676/ https://www.facebook.com/groups/128112754534676/