Family entrepreneurs against the sell-off of talent

“Even in such cases, German industry should see the opportunities associated with this – and have the courage to seize it,” suggests Frankenberg. The appeal against the sell-off of its own start-up economy is also indirectly directed at those 28 private companies that participate in his investment fund, from A for Altana to W for Werhahn.

The main drivers there are the Federal Ministry of Economics and the public KfW banking group. While more than 890 million euros have been collected in three funds so far, the fourth fund, currently on offer by June 2022, is expected to bring in the record sum of 400 million.

In a double interview with Handelsblatt, the professional consultant and bestselling author Hermann Simon, who discovered the phenomenon of “hidden champions”, regrets that many of the successful start-ups are sold abroad: “It is incomprehensible to me that the major strategic investors from Germany are not Go even more into the start-up business. Companies like Siemens or Linde have enough liquid funds. It can’t be the money. “

“The founder then goes home, to the wife or to the parents, and they say: Sell!”

The co-founder of the Bonn-based consulting firm Simon-Kucher criticizes that “we do basic research and then don’t put the PS on the road”. That would also be due to the lack of entrepreneurial skills of individual professors, who had brilliant ideas, but then left the marketing to others, often US corporations. He mentions the development of chips at the Bonn Research Institute for Discrete Mathematics and the neural networks of Professor Jürgen Schmidhuber, who once taught in Munich.

Professor Simon continues: “We need types of entrepreneurs who don’t want to make quick money, but instead want to build up companies. Why do they actually sell at 35? “

Talented founders often get good offers for their companies, explains Gründerfonds boss Frankenberg: “Then the temptation is great and the need for security is great. If the number is over five million euros, it wobbles. The founder then goes home, to the wife or to the parents, and they say: Sell! “

It is also about “false modesty”, he observed: “You don’t want to be the greedy capitalist with 100 million in the bank. Unlike Americans, we don’t want to conquer the world and tell everyone that we are the greatest. “

It is fundamentally important, like Facebook, Google, Apple, Amazon and Microsoft, to create their own ecosystem, continues Frankenberg. Such companies could “easily invest completely different amounts” in takeovers. In Germany, only SAP and perhaps Zalando and the Munich-based software company Celonis have so far managed to create their own ecosystem. All hope now rests on the vaccine manufacturer Biontech in Mainz, which could “construct a nucleus for an entire industry”.

Frankenberg sets the bar high: “We have to succeed in developing large, leading companies from our innovative start-ups – in order to achieve multiplier effects. In the end, it comes down to local value creation and local jobs. ”He also notes that strategic and private equity investors invest in start-ups:“ This is primarily an American, less a European or German business. ”

With their high stock market valuation and their technological competence, US companies would have completely different levers and could pay a lot more in the case of takeovers, analyzes Professor Simon: “The acquired German companies may not migrate afterwards, but the gentleman is elsewhere.” Consultant continues: “In the digital world with its economies of scale and network there are only very few winners. But then they are so profitable that they can do anything.

The top five in the USA spend more money on research and development than all German companies put together. because they get three times as much money there.

Start-ups need the “patient” money from German family offices

Frankenberg comments that the state has recognized the problem that Germany does not have a functioning stock exchange. The normal person puts his money in real estate or in savings accounts, but hardly in stocks. The ideal of the HTGF boss is that a founder and CEO goes to the German stock exchange with the “patient” money from German family offices and then remains at the top with “power” for another 20 years.

Apparently he had a career like this in mind for the Bonn-based software start-up LeanIX, after all, founder André Christ was once an intern at the Gründerfonds. But the LeanIX boss brought international donors such as Goldman Sachs into the company in 2020. As a positive example, Frankenberg mentions the Frankfurt start-up Emma, ​​which sells mattresses online with great success worldwide. The two founders are now bringing start-up culture to the Haniel family company, which has acquired the majority of the shares. The Haniels are also among the HTGF’s financiers.

So far, a total of eleven start-ups have been sold to such “friends” of the network, in two cases to Bosch.

The bottom line is that Gründerfonds boss Frankenberg looks back on “16 years of positive upswing in the start-up scene”, driven by funding, industry, funds and pioneers: “This upswing will continue.” His fund initially contributes one million euros each, and then more This seed financing can be topped up by two million euros each round.

There have been 150 exits at the 650 companies funded by the HTGF to date; for example, a company was recently sold to Cisco. There were also three IPOs in 2021, including the optics company Mister Spex, in which the HTGF had already participated in 2008. The long holding period of its own investments – eight to ten years on average – contributes to Frankenberg’s great claim: “We are a platform for industry.”

More: The new power of the founders: Why the start-up scene is changing massively