Heraeus is represented in almost every steel mill through its subsidiary Electro-Nite.
(Photo: Heraeus)
Berlin The globally active technology and family group Heraeus is getting a breath of fresh air. The Hanau-based company, which is primarily known as a precious metals specialist, is investing in the Berlin AI start-up Smart Steel Technologies (SST). “We are the largest shareholder with around 47 percent,” says company boss Jan Rinnert to the Handelsblatt.
There is also the option of gradually expanding the stake and taking over the majority. SST offers software solutions based on artificial intelligence (AI) for the optimization of processes in the steel industry.
Rinnert and SST founder Falk-Florian Henrich have known each other for a long time. Rinnert reveals that the rapprochement process took place in two stages and dragged on a bit. With its subsidiary Electro-Nite, Heraeus is the world market leader for measuring systems in metal melts and is therefore represented in almost every steelworks. “We are always looking for new topics that are interesting for us. We quickly became aware of SST,” says Rinnert.
Artificial intelligence improves processes
Last year, Henrich was also willing to talk: “We were looking for a partner who is financially strong, but who also knows the market and internationalization,” explains the SST boss. Together they now want to expand the product range, expand into Asia and grow more strongly in Europe and North and South America, where the start-up is already active.
At least since the recent advances made by the Microsoft partner company OpenAI, the attention for artificial intelligence has been high worldwide. SST believes that the technology can help to optimize processes in order to ultimately reduce energy use and CO2 emissions in the steel industry and improve quality.
“There will be no world without steel. Nevertheless, the industry has to transform itself,” says Rinnert. AI will play a central role in this. However, the Heraeus boss does not want to publish how much the investment was worth to him. In 2021, Heraeus, with more than 16,000 employees, turned over 29.5 billion euros.
>> Read more here: Start-up for green steel collects 190 million euros – from Schaeffler, among others
Nils Seele, partner at venture capitalist Lea Partners, who has been with SST as an investor for some time, said that together the two companies could expand AI market leadership in the steel industry. Smart Steel Technologies is not the only one pursuing this goal. The Berliners’ competitors include companies such as the Düsseldorf-based SMS Group, but also start-ups such as Noodle.AI from the USA and Fero Labs based in New York and Düsseldorf.
Around four years after it was founded, SST has more than 50 employees – including many AI and steel experts. “We have already created a wide range of possible applications that lead to substantial savings for companies,” says Henrich, referring to possible uses in the manufacture of automotive steel or wire rod.
The precious metal specialist becomes the largest shareholder in Smart Steel Technologies.
(Photo: Heraeus)
Despite the uncertain economic situation, SST is not short of customers. Renowned corporations such as Arcelor-Mittal and Vallourec are already among them. “There is a great willingness to rethink internal logistics processes because of the increased energy costs,” says Henrich. The crisis is making itself felt in a positive way through increased demand. The steel industry needs support in its upheaval.
Federal Economics Minister Robert Habeck (Greens) is currently working on a transformation plan for German industry, in which green steel production also plays a major role.
More: Habeck’s consultants call for a change of strategy in industrial conversion.