Dusseldorf Jonas Thiemann and Carlo Szelinsky can look forward to 100 million euros. The two founders and co-CEOs of the app platform Applike Group will receive an investment of this amount from the media, services and education group Bertelsmann, as the Handelsblatt learned in advance. The Hamburg start-up is now valued at 500 million euros.
Business economist Thiemann, 31, and technical computer scientist Szelinsky, 36, founded Applike in 2016 together with the Hamburg publisher Gruner + Jahr (G + J). The idea: earn money with technology-driven advertising on your smartphone. First, they examined the usage behavior of Android users and recommended them apps based on it. The Applike Group is now a holding company comprising four companies: JustDice, Adjoe, Sunday and Justtrack.
In JustDice, the initial deals are summarized; Adjoe helps app makers monetize mobile apps through advertising; Sunday focuses on developing and marketing games for smartphones. And the company Justtrack, founded at the beginning of the year, is intended to help app operators to control marketing processes automatically.
Depending on the company, Applike earns its money through marketing, license fees or app installations. “In the end, Applike works like the traditional media business, but in a new, technology-driven guise,” explains Thiemann. “The more app reach we build, the more inventory we can market.”
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Bertelsmann holds around 80 percent of the shares, the two founders around ten percent each. The Gütersloh family company supported the founders with money and the network. The young entrepreneurs are pursuing no less a goal than “to become the world’s leading app platform and to reach every smartphone user in the long term,” as Thiemann says.
The founders’ optimism is based on the fact that hardly any other media channel in the world is growing as fast as smartphone apps. In the USA, people are already spending more time with their cell phones than in front of the television, and this could soon be the case in Germany too, driven by the consequences of the pandemic. “The app market is over 100 billion euros, so there is still a lot of potential for value growth,” says Szelinsky.
According to their own statements, the Hamburg company achieves sales in the low three-digit million range and is very profitable with a double-digit profit margin. Applike is active in more than 100 markets. The most important country is the USA, which accounts for 25 to 50 percent of sales, depending on the company. Applike generates around a tenth of its sales in Germany.
100 million euros for new employees, locations and companies
Because of the high margin, Thiemann and Szelinsky were able to make many investments themselves. They have already received two cash injections from G + J in the past few years. They also want to use parts of the new 100 million euros from Bertelsmann to increase the workforce. The group currently employs 130 people from over 50 countries at the Hamburg location. By the end of 2022, the number should almost double to 250. Applike is primarily looking for people with skills in software development and technology – profiles that are scarce and expensive in the job market.
The founders also want to use the money to further develop the technologies and platforms. New locations are also to be created, for example in India, Turkey or the USA. “We want to improve customer contact and win more app partners through local contacts,” says Szelinsky. Further company foundations are also planned.
Until the turn of the year, Applike belonged to the Bertelsmann subsidiary G + J. Since the publisher merged with the Cologne TV group RTL, the stake has been held by the Bertelsmann Investments division. Applike is assigned to Bertelsmann Next, a new area with which the family company wants to open up future business areas. Bertelsmann boss Thomas Rabe says: “The two founders have repeatedly demonstrated entrepreneurial vision and creative know-how.”
Thiemann and Szelinsky met in 2012 at a start-up competition. They had to discontinue their first company, the voucher platform Copay, after a year. Her second idea now promises more success – also thanks to the support of Gruner + Jahr. The contact came about because Thiemann worked there as a project manager after completing his studies. The boss at the time, Julia Jäkel, drove Applike forward.
Thiemann and Szelinsky would also like to see such support for other founders. In order to be able to keep up with the companies in Silicon Valley, large corporations would have to invest more risky for young people with good ideas, they both say. “This only works if the very first row in the company is behind it.”
Seven years after the foundation, the two founders are now preparing to become a unicorn. This is what companies are called that have achieved a valuation of one billion euros. “Our initial dream has turned into an intermediate milestone,” says Thiemann. But it is unhealthy to work towards such a brand. They want to build a long-lasting and successful business.
More: Thomas Rabe achieves record results – Bertelsmann plans digital health business.