A new 3D printing company, Sculptify is taking the next 3D printing leap  replaces traditional (and expensive) plastic filament with pellets.  These ingenious pellets would significantly reduce the cost of home 3D printing.  (According to Sculptify, a 2-pound bag of pellet costs around $18, while a 2.2-pound spool costs roughly $48.)

Sculptify is not the first manufacture to use pellets, German manufacturing company ARBURG has an industrial 3D printer, the Freeformer, however Sculptify is the first hobbyist-level pellet based 3D printer. Here is Sculptify's Kickstarter video.

A diagram of the process. Source: Wikipedia.

There have been other companies toying with the idea of using pellets for 3D printing, including a couple of products that promise to turn your pellets INTO filament.  Products like the Filabot (2012), Filastruder (2013), and Strooder (2014).  Other companies, like Colorfabb, are beginning to offer plastic in its less expensive pellet form.