Stuttgart Lukas Biedermann, 33, and Martin Weber, 34, radiate the optimism of young start-up entrepreneurs in their office floor in downtown Stuttgart: a mixture of skill, happiness and, above all, courage. Because not everyone quits a well-paid job at Porsche Consulting to do their thing. Weber had the brilliant idea and Biedermann was enthusiastic about it when both worked at Porsche.
“Your thing” in this case is Sparetech, a software platform for digitizing industrial spare parts management. What does not sound particularly exciting, nevertheless leads Biedermann to the statement: “It is really fascinating to contribute to the digitization of industry as an entrepreneur.” Because he knows that this topic is extremely important for industrial production. The company name is derived from the English word for spare part, “spare part”, and “tech” for technology.
Lukas Biedermann knows what he is talking about: When his doctoral thesis “Supply Chain Resilience” was published in 2018, the general public was practically not interested in the topic of crisis resilience. Problems in supply chains – be it semiconductors or raw materials – are currently paralyzing entire parts of the industry. The susceptibility of just-in-time delivery directly to the assembly line has become the Achilles heel of German industry, especially since Corona, the temporarily blocked Suez Canal, increasing natural disasters and growing dependence on China. Buyers and materials managers have been struggling with constant stress for months to plug the holes.
In this situation, of all things, Biedermann and his co-founder Weber want to encourage companies to use an availability platform to slim down their warehouses and thus save costs with the heart of industrial production, the spare parts for the machines.
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Dead capital in the factories
Because, unlike with vendor parts for their products, car manufacturers, for example, play it safe and prefer to keep one more spare part in stock than is perhaps necessary. Because nothing is worse and more expensive for modern industrial production than when a machine breaks down and production comes to a standstill. Fear leads to caution: in an average plant, spare parts for 50 million euros are quickly in stock. In the entire German industry, such a gigantic sum comes together: 58 billion euros in spare parts stocks for production plants are stored as dead capital in the factories.
“We have developed the digital ‘data highway’ for cost-efficient spare parts management and resilient supply chains according to Covid-19,” says Weber. “We enable the smart factory in which spare parts are purchased when they are actually needed,” the CEO continues. The bottom line is that the supply chains are to be strengthened by Sparetech by automating all processes, from identification to ordering spare parts for the machines and systems. This creates a treasure trove of data that can also be of great interest to mechanical engineers. Because Sparetech knows exactly about the weak points of the machines via the spare parts management.
The first customers seem satisfied. According to Sparetech, the world’s largest automotive supplier Bosch has achieved an efficiency gain of 50 percent in one plant. Volkswagen and Airbus are also among the customers. There are already partnerships with leading manufacturers of automation technology such as Siemens, Rexroth and Festo.
And this week the founders are particularly resolved: After a successful pilot order in a plant, a customer from the automotive industry signed a framework agreement with Sparetech for its European plants. Weber and Biedermann are not allowed to mention the name, but it is an important step forward for the young entrepreneurs.
Sales have tripled to a mid seven-digit million euro amount. And for the next two years, the company, which wants to expand the team from currently 30 to 80 people, has been fully financed. Well-known investors got involved in seed financing in September.
Well-known investors on board
Put five million euros, led by the technology fund Headline as well as entrepreneurs and digital experts Christian Miele, Carsten Thoma, Christian Gaiser, Josef Brunner, Gisbert Rühl and Stefan Groß-Selbeck on the two ex-Porsche engineers.
The two founders do not reveal how high their own stake in the company is.
Investor Christian Miele considers Sparetech to be “a prime example of successful pioneering work from practice for practice”. Sparetech proves “that ‘made in Germany’ can also work digitally,” says Miele, partner of the venture capital company Headline.
“Our vision is to make Germany and Europe more competitive in the global logistics markets by creating the world’s leading availability platform for industrial spare parts,” says CEO Weber.
Even a veteran boss of a medium-sized company with a turnover of around five billion euros definitely sees a need and good opportunities for Sparetech technology, but points out: “The more standardized the spare parts, the easier it is to implement availability. The more inconsistent, the more complex it becomes to enable safe and fast delivery. “
That doesn’t detract from the founders’ optimism: “Our system helps our automotive customers, for example, not to lose touch with Tesla,” says Weber. That sounds like the typical exaggeration of young entrepreneurs, but as research in the industry shows, at Porsche, the entire spare parts management for the completely new production of the first Taycan electric sports car is carried out via Sparetech.
Investor Miele is definitely convinced that it has captured a potential unicorn with the Stuttgart start-up: “Otherwise I would not have invested,” says Miele, who is also President of the Federal Association of German Start-ups.
By the way, Biedermann’s doctoral thesis has meanwhile downloaded 20,000 interested parties.
More: Bottlenecks in the automotive industry: The chip crisis is followed by an even greater problem with the lack of aluminum