Nonprofit is the business model that TechShop should have pursued, but they realized it too late.
There are a lot of things a not for profit can do that a for profit business cannot, like taking donations, and giving tax write-offs.
They could have had sponsorships and endowments from a lot of corporations, like toolmakers, machinery companies, schools, and had training provided by governmental entities as part of work programs. Instead, they went for the large gains that might come from having venture capital investors, and others seeking large returns.
Plus, people in the US no longer "make things" like they used to. In the "old days", everyone had a shop in their basement. Now, people have a bar, a home theatre, a TV watching room. Things have changed. Most people don't make things, they buy things cheap that are made for us in China. And people who want a shop will buy their own tools, and make their own shop in their house or rent a space to put their tools.
Making a hobby into a business is tough. Running a business is very hard. You cannot count on revenue streams. You must have a sustainable business model, or quickly morph into one. They decided to "pivot" when things were already too late.