Germany has long been known for tech innovation and a very powerful economic driver. Berlin has grown to one of the most attractive start-up hubs in the world, putting Munich on the second place within Germany, yet still before Hamburg, Stuttgart, Frankfurt and other cities. With the enormous startup thrust – startups pushed to grow even beyond the German borders. Funding was the most significant barrier.

IPO Breakthrough

In the first quarter of 2018 alone, startups and spin-offs from larger companies pulled in close to  7 Billion Euro with their IPOs. This is more than the rest of Europe combined. This is pushing Germany in spot No. 2 globally behind the USA. And more IPO candidates are already in the loop. It took a bit for Europe actually to show that their startups have IPO quality – but now they seem to come with full power. More than just a handful, including HalloFresh, Delivery Hero, Zalando, Rocket Internet, Windeln.de, German Startups Group, Elumeo, Ferratum, Trivago, MyBucks, Akasol, Home24, CreditShelf, NFON and some others made it and IPOed in Germany already.

In the meantime, more IPO spots try to attract fast-growing businesses like the EuroNext in Amsterdam, Netherland and the Paris Stock Exchange. The relatively high P/E ratios of the classic enterprises, relative to their growth rate make those young businesses attractive. If one looks back to the early 2000s when a big surge of US startups went public, the majority of the investors where laughing, but today those companies produce a multiple that has never be seen in public companies before.

 

Artificial Intelligence Leadership

With the second biggest IPO finance place in the world, Germany is also attracting companies from other countries. More importantly, Germany is also preparing the capital flow into the next generation technology to support their declared attempt to become a global leader in Artificial Intelligence. The official AI strategy will be introduced Dec 4/5 2019. And with rapid financing growth has always been a worldwide challenge, the IPO leadership in Europa makes Germany also the place to go for AI startups. We will report about the AI Space Germany in December.

Stay tuned.

 

A 3 day global online live event

Today we concluded an amazing 3 day innovation and entrepreneurship power play. Over 500 attendees from over 40 countries joined the online live event and in local ‘public viewing’ events.

Albania, Argentina, Australia, Austria, Azerbaijan, Belgium, Brazil, Canada, Denmark, El  Salvador, Germany, Ghana,  Greece, Hong Kong, Hungary, India, Israel, Italy, Japan, Liechtenstein, Lithuania, Macedonia,  Nepal, Netherlands, Nigeria,  Mexico, Norway, Peru, Portugal, Romania, Russia, Singapore, South Korea, Sweden, Switzerland,  Taiwan, Ukraine, United kingdom, United States, Uzbekistan, Vietnam.

From physical to digital

What’s the secret sauce for the success? The whole event was online. Last minute we changed the whole format from a physical event which would have been only affordable for the wealthy countries to online – and made the access for free for all attendees. The cost to organize the event was significantly lower, we did not need to fly in 500 people – and feel good about the savings in negative environmental impact, carbon footprint and more than ten thousand hours in aggregate for none productive preparation and traveling.

Live Online Pitch from Nepal

Live presentation of a team of scientists who developed a new method to easily test animal pregnancy and getting results within hours. They don’t need any long lasting clinical tests anymore which would not be economically feasible in many countries. Startup winner from Nepal.

The Whole Ecosystem was here

It was extremely interesting to see innovative startups from various industries, tech, biology, health, and more to present. Investors discussed national and international investment strategies, valuation differences and due diligence processes.  Enabler such as incubators, co-working spaces, accelerators, mentors and technology and service providers shared their point of view and how startups from around the world could just go to any space and any enabler and receive help when going global. Government representatives and ambassadors shared what it takes to enter a country and how they can help to make the start and the stay easy and convenient. The 58 sessions in a highly intense 15 minute sequence was a firework of information.

Hot Investor discussion

Investors from all backgrounds explain investment strategies and experiences. Why investing in international startups is attractive but also the obstacles on the legal and taxation side are to be understood. Discussions about valuation, due diligence and what investors expect, how they evaluate and select startups and the best ways for startups to find investors.

Public Viewing of the otherwise global online event

Our ambassadors in Japan, South Korea and Nepal organized global viewing events. The global online event was supported with local on-site events to foster the regional and global community. The Japanese team together with Fabbit, a leading co-working space, organized the perfect show (see below).

Live presentations – streamed around the globe.

Here a startup in Japan is presenting on stage, the event is live streamed to all attendees around the globe, our Judge located in Switzerland listens and asks questions about the presentation. 500 people in 43 countries watch, learn and share.

Going Global – What can be done

Ambassadors from Japan, Vietnam and the team in Switzerland share how startups from around the world can travel around the world and ramp up a business in a new country possibly even within a few weeks.

Amazing Technology – literally from the kitchens of the future

Russian startup presents a new night vision technology, which is very affordable, light weight and easy to install in the next generation of automobiles. Imagine traveling at night and you can watch the scene almost as if it is a bright day.

A new dimension in high tech conferences

There was never any innovation conference of that diverse and complete audience from the whole ecosystem, on a global scale run all online over multiple days. And to be quite honest – most people found it a bad idea “conferences are networking events, it will never work online”. We kind of agreed but we still needed to try (The risk of regretting not trying is greater than the risk of failing). The dynamic of this first little conference is the spark, helping us to completely rethink global conferences.

Where we are going to take it from here?

  • Strengthening and growing the global community
  • Building the necessary platform technology and blockchain for permanent connections
  • Engagement such as discussing individual challenges, questions, ideas, marketing, acceleration, going global and countless other topics.

Please  JOIN  the community.

Thank you, attendees from 40+ countries, S3-Ambassadors from around the world, speakers, investors, enablers, supporters,  and the Society3 dream-team! Also thank you Swisscom for a rock solid 1 Gigabit glass fiber connection directly onto our desk – wow, flawless.

Innovation gets funded with billions of $ all across the world. Hundreds of thousands of startups get founded every year. Yet 90% of the inventions, patented ideas, startups and corporate innovation labs do not succeed. If our crops would have been treated like our brain crops, humans would have extinct by now.

SOMETHING WENT REALLY WRONG

After a keynote at the European Commission’s Digital Agenda, I discussed a burning question with one of the officers. I asked: “Why is so much money poured into more and more inventions and innovative ideas but absolutely nothing in helping to get them to markets?” The answer was prompt and very clear: “Commercial success is the job of the entrepreneur, not of a government”. While I understood the rational behind the thinking, I still found it odd to let 90% of invested money evaporate, just because a more or less philosophical process. The result is not only lost opportunities but also widening the chasm between rich and poor, putting the leadership position of a nation in jeopardy and risking to loose talents who may find other nations more appealing.

Innovation that can’t be brought to market is of no value for the respective society and should not be funded with tax money.

WHAT PROFESSIONAL INVESTORS DO

The top venture investors nurture their investment from Idea to IPO. It’s the only way to get a significant return on investment. Plus they educate, mentor and coach their portfolio companies to bring them to maximum performance. And the result is stunning. instead of 90 % failure rate it’s only 75%. In other words they doubled the success rate of startups they have invested in. Unfortunately that is the tiny fraction of startups that had the privilege to move to Silicon Valley and get investments from some of the top VCs. But in the end, our “Innovation Crops” deliver a miserable 10% yield, while we know we could get it up to 25%.

We need to change the innovation paradigm

WHAT IS THE VALUE OF INNOVATION

I guess we can agree that innovation is perceived a key driver for progress and growth. But is that true?  Is it the innovation or is it the ability to bring new and different products to market and attract a huge amount of people to support it, buy it or otherwise engage with it. A less innovative product that is produced in huge quantities and attract a large global market is most likely creating more jobs, more revenue, more profits and therefor more taxes for the local community than a product that is much more innovative but nobody knows about it therefor the company may not even survive. The true value of innovation is created at the time that product or service is hitting large markets and get a lot of business.

ONLY SUCCESSFUL INNOVATION MEANS JOBS AND TAXES

If we can agree that a value is only created when the companies grows, creates jobs and pay taxes, we should also agree that funding the urge of developing something is less important that funding the the need to bring it to market. Creative minds will build innovative products whether they get funded or not. But only if economic success is supported afterwards the innovation is gaining in value. And if the core driver for Innovation Funds is job creation and prosperity we may need to reconsider the funding strategy and put some money aside for every amount of money spent in the invention itself.

NEW INNOVATION PARADIGM FOCUSING ON COMMERCIAL RESULTS

A new innovation support program needs to focus on commercial success more than anything else. That includes providing non bureaucratic processes and rules to actually be able to make global trade even as a startup. It means lowering regulatory barriers to an absolute minimum. It also means providing business education to leverage latest techniques for an efficient and successful go-to-market plan – something no university will ever be able to offer. And means that young startups are supported with international networks and concepts to leverage existing trade networks. And of course that some of the funds available for the invention itself is also made available to kick start the commercial success.

 

One of the big hurdles for entrepreneurs trying to grow fast and go international, are trade rules, currency considerations, trust, transaction financing, dealing with letter of credits and much more. Global trade for startups is virtually impossible. After getting global four times with our previous businesses, we decided to make it easy for all young entrepreneurs to go international. We started to design a global trade network, leveraging latest blockchain technology, smart contracts and our own global business know how.

Most super growth tech companies were still too slow

When we look back in time, Facebook demonstrated an unbelievable power of growth, yet it was too late in Asia. The same goes for Uber, Tesla and others. On one side conservative investors argue about speed to go international. Yet later stage investors argue about missed opportunities. Conventional growth techniques just did not allow mach faster growth than the current world leaders showed.

We don’t want to support monopolies, but….

Amazon for instance had a great chance to go global without anybody copying it right way. However new contenders like Alibaba do not stop taking market share bit by bit. That means monopolies find their contender quickly and that is a good thing, because we need diversity and options. But maybe it’s a good idea to give fragile startups an opportunity to go international even faster and then learn to defend their innovation at a later stage.

Blockchain based global trade for startups

Global trading platforms are the most used example when blockchain technology get’s explained to industry executives. However global enterprises can’t just rip out their conventional IT system and replace their gigantic databases with a blockchain. Nobody even knows if a slower blockchain would hold the load. That is very different with startups. Their problem in international trade is the initially small volume. For a blockchain however just right. Bringing thousands of startups quickly on a centralized system would be a nightmare. But using a self regulated decentralized solution a great opportunity. Building out interfaces to adopt the blockchain by a startup is easy – for enterprises a life long project. Making global trade rules standardized through smart contracts can be very easy adopted by a startup that has no real rules today. Just creating all the smart contracts for an enterprise would be a complex undertaking with lots of risks and liabilities.

The Society3 Blockchain would allow technology resellers in any corner of the world to safely buy and sell innovative technology that also comes from any place in the world. Tokenized businesses where anybody can trade anything makes the business much more valuable and much easier to conduct.

What does that mean in reality:

  1. Instead of creating, negotiating and working based on tens of pages of a distributor or sales contract written in many languages and considering many currencies, we invented self executing contracts that define the trade process once and for all. If adjustments are needed in future situations they will be adjusted for future deals as well.
  2. Instead of trying to understand the other trade party and developing some vague sort of trust, all players on the trade platform are authenticated and clearly identifiable. Trust development is taken over by the system.
  3. Orders can be placed by anybody and send to any trade partner. The fully decentralized trade model does not need any “distribution organization” in between. The blockchain and the corresponding user interfaces take care of the transactions and processes.
  4. Shipments are  made by the companies (startups) using any of the freight forwarder who docked onto the platform. Tracking and processing of all documents are taken care of by the blockchain and the corresponding self executing contracts.
  5. Delivery can be made to business partners or directly to end customers. Payments are made in crypto currency and every party takes care of the conversion of crypto into the respective local currency and back.
  6. Smart contracts keep track on both, the order flow and the shipment flow in digital form. Tax and customs documentation can be either printed when necessary or also digitally transferred.
  7. In case of a return due to a defective product, the same process goes reverse.
  8. Transaction cost is covered through miners getting paid for their job in tokens and only over time there maybe a small fee in the sub % range necessary to keep the platform up and running.
  9. Producer, customer, shipper, customs authorities and any other participant can be rated and that way develop reputation over time.
  10. The system provides unparalleled transparency due to its decentralized management at lowest possible cost.

Never before it was so easy to sell and buy products from all over the world to all over the world. Most of the expensive and delay causing intermediaries are reduced to one: the decentralized blockchain.

If you like to be part of the Global Trade System project, influence functionality and beta-test the first version of the GTS as soon as it comes out, please join the group and apply for the project.

GTS Project Application

Application link will be available soon

 

SOCIETY3’S FIRST GLOBAL ONLINE MEETING

After creating one of the most successful accelerator programs and working with entrepreneurs for the past 4 years, we decided to take our vision global. Today we are represented in 25 countries. And since we cannot bring millions of entrepreneurs to Silicon Valley – we need to do something radical different. We, the founders of Society3, are used to disrupt and make a difference. Today we begin to make a difference in how entrepreneurs in all countries get supported, treated more equally and have a chance to become a big company as if they would have started in Silicon Valley.

We need to rethink our abilities to permanently collaborate on a global scale. Creating a simple copy of Silicon valley is not going to work and definitely not the very spirit of Silicon Valley. Disrupting the main disrupter is. The digital world already holds all the necessary assets. We don’t won’t to ‘improve’ Silicon Valley but stand on it’s shoulders taking the amazing culture that was created there to an all new level.


REGISTER CON CALL EAST

Best for attendees from Europe and Asia


REGISTER CON CALL WEST

Best for attendees from Europe, Africa and Americas

AGENDA

* THE NEW EXCHANGE
Creating a global exchange for innovative minds.
How can entrepreneurs, investors and enabler benefit.
What’s our experience after 20 years Silicon valley.
How can every entrepreneur around the world leverage
global connections.

* GLOBAL ACCELERATOR
Running the first global online accelerator so every
entrepreneur can join, no matter where they are.
Main topics are: Bold visions, disruptive business models,
zero budget go-to-market strategy, traction and growth
hacking, fundraising,

* INTERNATIONAL TRADE FOR EVERY STARTUP
Building the first global trading & transaction system for
young entrepreneurs using blockchain technology.
Getting business rolling into almost any country faster then
ever before imaginable – at nearly no cost.

There is no substitute for a great in person meeting, like there is no substitute for an amazing live concert. Yet we hear MP3 music every day. This online conference is about online engagements, creating a mindset for online collaboration and an experiment to create a permanently connect online ecosystem – very much like Silicon Valley.

HOW TO CREATE A SILICON VALLEY CULTURE?

Every group of autonomous people can create a culture. We are on the verge of creating an all new entrepreneurs culture and significantly increase startup success rates no matter where they are located.
We do not want to change anybody or their culture. But we want to connect those, globally, who already have a good idea about an open and sharing ecosystem where we all can learn from each other and build businesses who can grow fast, create new jobs and provide value.

On April 5 we want to talk about how we can do that and how the culture in Silicon Valley was created.
All you need is an internet connection and a way to listen and ideally talk online.

Please register here:


REGISTER CON CALL EAST

Best for attendees from Europe and Asia


REGISTER CON CALL WEST

Best for attendees from Europe, Africa and Americas

There is no charge to attend

competing successful with enterprises - Society3

Once in a while I meet entrepreneurs with amazing ideas but they don’t know how they could compete with even the largest enterprises.

I started my first company from scratch with $20,000 and needed to compete with 3 other businesses, each $200 Million to $1 Billion in revenue – 10 years later we were market leader on a global scale ($5B in revenue)

My second company was a little more different

I started my third company right after the bubble burst and competed with two other competitors who had $70 Million and $68 Million cash in the bank from pre bubble rounds – I started with $500,000 – 5 years later we were close to acquire one but let go because the due diligence made clear there is nothing we could gain – being the market leader already.

Here is how we compete:

1) In each case we developed a disruptive business model. We completely went of the beaten path and redefined sales channels or we made payments in very different ways, provided transparency were was none, service integration in the pricing and so forth. It was the market that forced the competition to follow us and compete with us – or loose it.

2) I never competed based on technology, product functions or any of those short term win or loose features. I learned: “The best product never wins”. However we did have great technology because we had great engineers – yet it was not the winning factor in the end.

3) Business is done between people. I knew I can win more customers when I have a nicer team – and I always had a stellar team. :)

In retrospect: all big winners won with a superior business model and amazing teams.

Obviously I don’t know anything about your business and therefor it is hard to make more specific suggestions – but look at your business model and your team before you even spend a millisecond on your product when it comes to competing for market share.

A good read to make sure you can handle such a problem is the question to find great founders

I’ve worked with over 100 startups in the past years and ran 5 businesses myself.

My experience – in this order: 

No. 1) Weak execution

Most failing startups could just not execute in a timely manner and/or showed a huge lack of judgment. They worked too hard on product features, too little with the market. They built too many “nice to have” features. They did not launch in time and did not work hard enough to build a use/customer base. Didn’t manage expenditures well enough. Failed to identify opportunities, failing to build strategic connection…

No. 2) No long term vision

It’s hard to convince a customer that your young startup is the right business if you just focus on your present product features. It’s hard to convince investors, partners, top talents if you can’t express where you want to take the company. 

As a result you won’t get enough traction and most likely fail.

No. 3) Superficial market/customer research

Lack of product-market fit. Very often startups develop products for themselves instead of for a large market. They keep their development too close to their chest instead of involving test customers very early on – even before they create their first prototype. The result is often to too far off from what the market needs. 

No. 4) Team weakness

No sense of urgency. Not fit enough on the technology side, not fit enough on the marketing side, not fit enough on the finance side, not fit enough on the operational side. 

5) Lack of connection power

Startup teams all too often underestimate the importance of building their own network of influential connections. Connections to influential users, influential industry groups, influential analysts, influential media, influential business alliances… Or they hope to find investors and mentors that provide those connections. In reality it’s just not working that way.

Re- money 

Many comments are made that money is one the problems. In all the cases and startups I’ve seen, lack of money never brought a startup down. Lack of funding is a function of one of the above issues – not a problem in itself. There is more money available than ever before – but the above weaknesses prevent startups to raise funding.

You have only 24 hours a day minus 10 to sleep, eat and recharge makes it 14 hours.
I assume you are tackling a large market and want to conquer the world. I also assume you want to have about 30% market share of whatever billion dollar market with roughly 20 Million potential customers.

This post was inspired by a question on Quora: As CEO and non-tech co-founder, what should I be doing before we launch while my tech. co-founder is coding?

The 14 hour day of a startup CEO

1) List building 1 hour
Start spending an hour a day to extend the list of potential customers who should test, use and buy your product once it is ready. Make the list a simple spreadsheet with first name, last name, company (if B2B), linkedIn profile, twitter name, location, interest (B2C) or title (B2B). Try to get 50 names a day (so work fast).

2) Reaching out to users 1 hour
Try to reach some of those people right away and ask them what they think about the solution you develop. Talk on the phone if possible or online otherwise, Do your very personal market research – but more importantly build connections.

3) Theoretic team building 1 hours
You will need a stellar team when going to market. Look for your best possible marketer, sales people, maybe operations, production…. Make a list, reach out get feedback more on what they think you may need and begin to be in the market. Go through groups, read news, find the top guys and make another list of those people so you can go hire them when the time is right and you don;t need to start looking when you have no more time.

4) Thought leadership building 1 hour
Craft blog posts and answer questions on Quora, write comments on other blogs and become known as a very smart person in your specific field. You may easily extend that to two hours if you have some room for it.

5) Content development 1 hour
You can do that in a few days but exhaust your creativity pretty quickly. Instead you may work a solid hour a day on content creation. Product description, video clips, website improvements, blog posts for the same, industry trends, social trends, product trends….. the sky is the limit – but you have only one hour a day.

6) Operations, processes, pricing
Think through the sales process from soup to nuts. From talking to new customers for the very first time, how they land at your business, what they need to do to buy something from you, how they pay, how you invoice, your pricing model, contracts, services, liabilities, terms of service, privacy, compliance….. an hour a day is only 7 hours a week or some 90 hours a quarter so if you are on top things you should be able to get it done.

7) Company evolution, 1 hour a day
It’s a bit limited but again, you have only so much time. So think through your product road map, bring it in alignment with your vision, weave in the feedback from the conversation with customers (see above), consider the evolution of your competition and think about how your market will evolve in general. Try to write a script book for your business scifi – what will your market, our society, your industry, the technology and your company look like in 10 years from now. Write it down, do a video clip. Solidify your vision.

8) Team building 1 hours
Spend time with your team, how they are doing, what they achieved how the product evolved and bring their work in alignment with your vision – every day. Make sure a Minimum Viable Product (MVP) is a indeed a MINIMUM Viable Product. Don’t allow yourself surprises “I thought you though that we thought we do this….” Know the progress. Have a chat at the water cooler too :)

9) Make yourself familiar with your market 1 hour
Read the news, be in online groups, understand who gets funded in your market, what they do, what new industry regulations may pop up, who gets quoted very often, meet the mover and shaker know exactly what is going on.

10) Prepping for alliance management – 1 hour
Create a list of potential alliance partners, No matter what you produce a new satellite, a mobile app, a new breed of avocados, new diapers or a new pizza shop – you never work in isolation so find out who are all the potential business alliances. Maybe service providers you can work with, interesting suppliers, industry organizations…. you get the point.

11) Finance & Investment – 1 hour daily
You will want to continuously work on your financials, model the future with everything you learned in the other 10 hours each day, “model and tune” it. Then start looking for investors. Make a list where you add at least one investor per day. The day you are starting to go fundraising you will appreciate that advice more than anything else – because it takes time.

12) Meet the industry 1 hour a day
Go to events, share your vision early on, be in the market talk to people. You may not do that every single day but at least twice a week. And as long as they don’t come to your office, you will need to allocate 2-3 hours for those events at least. And most likely you exceed your one hour budget per day very quickly.

13) Meditate, read a book – work out 1 hour a day
You know you will need to feed your mind by shutting completely down other than sleep – and one hour once a day is most likely just perfect.

14) Socialize one hour a day
Have breakfast, lunch, coffee, dinner with somebody from your business world once a day or every other day. Just be there and listen and learn, get feedback – or help and provide insights :)

Well – now there is a ton of other things that people do: taking an hour to read emails, organizing their day, scheduling the doctor and getting ready for the weekend. Oh not to forget movies – unfortunately and as you see above – no time for any of that. Sorry.

As a tough CEO you will not allow your team more than 6 month from start to MVP. You will need to hurry to get all the above done by the time the product can hit the market.

Enjoy the ride :)