Do Not Make the "American JLC"

Every few years someone decides they must build "the American JLC." Nearly all of them fail or whimper into obscurity for the same reasons. After dozens of conversations with PCB manufacturers, customers, industry professionals, and founders who attempted it themselves, I've come to a singular conclusion: don't build the American JLC.

The following is a collection.

1. Don't take venture capital, or if you do, don't compete with simple or standard boards. Certain products, commodity goods as an example, are a terrible product to build a venture-capital backed business around. PCB boards, unless manufactured through some novel method or are of a unique formfactor (RF boards and many-layered boards as examples), are a commodity good. At the end of the day you must ask yourself "Is your product well-equipped for the type of capital you are utilizing?"

2. You need cash, a lot of it; and not venture cash. Venture capital isn't well formed for commodity good based businesses. Estimates range from a scrappy $5MM to $12MM for just the most basic facilities and machinery, and even then you won't be seeing returns - even on the machines alone - for many years.

3. Commodity based businesses only succeed when they can make something cheaper, faster, or of higher quality than their competition (or a few other things like volume, branding, smaller MOQ, etc. but these are all typically pretty aligned with the above three in this business). You will not beat China or even most American fabs on cost in PCB manufacturing. You will not beat either on quality, at least initially. This leaves speed, and the only way to compete on speed in commodity manufacturing is to grow slowly. You must be patient.

4. If you take venture capital you either need to be an engineering focused or a research focused startup. Engineering startups design products based on known physics (loose terminology) for an unproven customer base. Research startups design products in hopes they'll find the physics along the way for customers they already know exist. For PCB manufacturing that means either inventing a fundamentally better manufacturing process or offering something that isn't a commodity good or service in the first place.

5. "Location, location, location" applies to more than just real estate. Electricity cost, regional regulations, and even job markets, all affect the bottomline.

6. China is cheaper than us for bare board fab for many reasons, one of them being because they have lighter restrictions on the disposal of the toxic byproducts used in PCB manufacturing. In addition to this though are supply chain density, chemical supplier proximity, an extensive local equipment ecosystem to purchase from, having a trained workforce, massive government support, economies of scale, and decades of accumulated process knowledge. You must be ready to compete with them on all of these fronts simultaneously.

7. Even if you have the best prices in America for PCB fab, or PCBA, you will have to convince engineers that your prices are completely reasonable. They have spent their entire careers purchasing from non-margin or even negative-margin Chinese fabs. You aren't competing with China, you are competing against the American engineers' own taste in pricing.

8. Speed can be competed against only if you scale slowly; scale too quickly and your lead times will become too long. You will not be able to add capacity at a quick enough rate. The form in which venture capital is allocated is not well suited for ten or twenty year timelines.

9. Don't fall for the assembly trap if you want to be massive. Assembly has become an increasingly competitive service business with limited differentiation unless accompanied by proprietary manufacturing methods or unique customer integration. There is a multitude of assembly providers in every major U.S. city.

10. Qualify for ITAR. This is the only breakout market in the US for PCBs - margins are roughly 10x higher than any other market for certain boards. Engineers in these spaces are already used to American pricing - very uncommon. In other words, if you want an initial market to cater to, this one exists; all other markets are ones you'd have to create. Despite the common misconception, immigrants can qualify for ITAR (though there may be more diligence).

11. Cost doesn't really matter for ITAR customers, more so the deadline; and even then that's more of a marketing gimmick. Speed is the marketing and de-risking is the product. To reiterate, this only matters for ITAR customers, everyone else only cares about price in the U.S. Reliably providing boards at a predictable rate is infinitely more appreciated than providing boards on unpredictable timelines - another reason to grow capacity slowly.

12. You have a deadline: January 1st, 2027. 10 U.S.C. §4873 takes effect Jan 1, 2027 (DoD barred from acquiring "covered PCBs" from China/Russia/Iran/NK); the DFARS ANPR dropped July 2, 2026, comments due Aug 31, 2026. Every defense prime now has a 5 month countdown (as of Aug 1st, 2026) to re-source and stand up compliance.

13. Focus on 8 layer board manufacturing for an initial competitive advantage. Most of the competitive market is 4-6, but priced at commodity or less. Many-layered boards give you a competitive advantage as nearly all medical and defense devices with a reasonable margin are 8-12 layers.

14. There are no shortcuts, software alone is not a defensible moat. Get paid to design and engineer the product or get paid to manufacture it. There is a reason I make and have made all of my software open-source (see pcb-dfm or my gerbers renderer), namely that it offers no competitive advantage to keep it private. In this modern era, it might actually hurt to keep your code private as it will only encourage others to compete against you thinking that they can do better. Making the software won't hurt you at all, it's free advertising if you do it right, but it also won't help either in the ways you might hope.

Manufacturing moats are earned through accumulated process knowledge rather than software or startup capital. Every month of production generates operational knowledge that a competitor cannot purchase. Machines can be bought; experience operating them at high yield cannot.

Don't copy JLC's business model, it doesn't work here in the States. Build a specialized domestic fabrication company that wins on compliance, predictability, and focused capability, compounds manufacturing expertise over years and decades, and expands only as capacity and process maturity allow.

Best of luck on your venture.

Vincent