Manufacturing is Having a Software Moment

October 29, 2025

By The Artemis Fund
The Artemis Fund believes technology can create prosperity for all. With offices in New York, Texas, Massachusetts, and Nevada, Artemis leads seed rounds for companies creating resilient families, individuals, and businesses across the US.
Most brands don’t do their own manufacturing. Rather, they rely on third-party factories (a setup known as contract manufacturing) to produce everything from serums to supplements to sneakers. This model has enabled asset-light growth and global scale, but it’s also introduced friction, opacity, and rigidity that can slow brands down.
Behind (almost) every breakout consumer brand is a complex web of production partners, forecasts, delays, and pivot-on-a-dime decisions. Yet, most of the manufacturing infrastructure that brands rely on hasn’t caught up to the pace or precision modern commerce demands.
So we asked: What does the future of manufacturing look like? Especially for brands prioritizing agility, personalization, and sustainability? Here’s what we learned.

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The Status Quo is Broken
Traditional contract manufacturing is stuck in a time warp. Long lead times, rigid production requirements, and opaque pricing structures routinely slow down even the most promising production runs. Communication gaps lead to errors, quality issues create customer churn, and high MOQs (Minimum Order Quantities) force brands to bet big before they know what will sell or price out smaller producers. All these are costly growth chokepoints. U.S. manufacturers lose up to $1.2T annually due to poor communication, while quality issues can erode 15–20% of top-line revenue. Ultimately, when a factory can’t flex, neither can the business.
The Manufacturing Playbook is Being Rewritten
Today’s fastest-growing brands are rewriting how they work with manufacturing partners. Gone are the days of seasonal forecasting and monolithic supply chains. Instead, savvy operators are designing their back end for speed and optionality.
We’re seeing demand for asset-light production models that enable shifts from annual to weekly planning cycles, as well as an increase in nearshoring, where production is moved closer to customers to cut shipping times, reduce risk, and facilitate more seamless collaboration. Mexico alone has attracted more than $40B in nearshoring investments since 2021.
Personalization Has Entered the Supply Chain
Consumers expect personalized experiences, and they’re willing to pay more for them. Personalized products require manufacturers that can handle complexity at scale.
Most brands aren’t chasing full Curology-style customization. Instead, they’re using smart software to personalize within fixed SKU sets: think quizzes, dynamic bundles, and adaptive subscription flows, but even this lighter lift puts pressure on production. It requires short runs, flexible lines, and reliable QA, all in near real time. To keep up, modern manufacturers need to have the ability to pace with both order volume and consumer expectations.
The Factory Floor is Going Digital
The standout modern manufacturing startups are building infrastructure that mirrors the flexibility and intelligence of modern commerce. They are creating a new normal: modular, software-defined, and deeply responsive production.
Here are a few of the most interesting companies on our radar reimagining what a factory can be:
Bright Machines: Modular microfactories that automate electronics assembly
Dimax: Digital industrial SaaS platform enabling on-demand manufacturing at or near the point of need through a verified, three-sided network.
Formic: Robotics-as-a-Service provider making automation accessible to small factories
Hadrian: Highly automated precision parts factories serving aerospace and defense
Tulip: No-code platform digitizing factory floor operations
Xometry: On-demand manufacturing marketplace for custom parts
The contract manufacturing market is enormous ($140B+ across consumer health and personal care alone) and ripe for reinvention. Legacy operators still dominate, but a wave of venture-backed upstarts are attacking from all angles.
At Artemis, we’re excited about platforms offering manufacturing-as-a-service (MaaS), allowing brands to scale production like cloud storage. We’re tracking advances in AI-powered product development that compress time-to-market, and we’re watching a new class of robotics startups that make automation accessible even to mid-sized brands. The next generation of contract manufacturing is more aligned with how brands operate, how consumers buy, and how global supply chains need to evolve.
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