Venture capital, credit, funding programs, crowd investing – at first glance, there seems to be plenty of funding available in Germany to translate potential innovations into reality. Despite this, politicians, intermediaries, entrepreneurs, and companies throughout Germany grumble about an unwillingness among capital providers to conscientiously take risks. The Steinbeis Financing Arena took place on April 7, and posed a provocative question: “The money is there – so where are the ideas to go with it?!” A number of funding partners, startups, and established companies were in attendance to take part in an interactive and sometimes contentious discussion. The arena was moderated by Prof. Stephan Ferdinand (Stuttgart Media University) and Tina Kraus (public broadcasting company SWR). The event was clearly in tune with the times and the interests of industry, as witnessed by the many people in attendance. With an audience of roughly 200 people assembled at the Stuttgart Hospitalhof, many more were interested in the proceedings and had to be consoled with video highlights afterwards.
Christine Gysin-Rosenberger (L-Bank), Eleftherios Hatziioannou (smoope GmbH), Dr. Alex von Frankenberg (the startup fund High-Tech Grunderfonds), and Guy Selbherr (Mittelstandische Beteiligungsgesellschaft Baden-Wurttemberg and Burgschaftsbank Baden-Wurttemberg) took part in the panel discussion in the central circle of the arena. As representatives of both capital providers and business founders – the ones seeking funding – their opinions were sometimes polemical. The outer ring of the discussion forum also made an essential contribution to the interactive nature of the event. It consisted of Heinz Liebrich (tax advisor), Thomas R. Villinger (Zukunftsfonds Heilbronn GmbH & Co. KG), and Axel Wittig (WEBO GmbH), who were allowed to take a critical view of the discussion. One thing everyone agreed on as the discussion got underway was that the situation in Baden-Württemberg is in no way comparable with the high-tech Mekka of Silicon Valley or the situation in Berlin. What they could not agree on was whether this is because the conditions are wrong in the state to promote “success through setbacks” – perhaps, in reality, the cliche that “you need to have setbacks and start again to make progress” is actually entirely different in places like the U.S., which is often pointed to as a role model. The panelists found it more important that people are conscious of the strengths of the state and that these should be shared much more openly and more confidently. This was seen as a weakness that stems from the German business mentality, particularly in Baden-Württemberg, where things are about understatement and where patting yourself on the back or blowing your own trumpet is considered “improper,” according to the panelists.
The different views of capital providers and capital users were not the only issues discussed. Even within the funding community there are sometimes quite diverse opinions. Traditional banks primarily considered themselves obligated to savers and shareholders and severely restricted in their ability to enter risk by regulations. Business angels and family offices, of which there are many in the state, often operate in the wings and are at a strategic advantage. For them, it is often easy to take a risk for a startup since they are investing their own money. This prompted the audience and panelists to wonder whether traditional banks should actually not be considered as risk capital providers or financers of business startups, because they would be expected to behave in a manner which is incompatible with their purpose as an organization.
The discussion regarding the general unwillingness to take risks was followed by a question regarding the mentality of self-starters. What makes successful entrepreneurs and what makes them tick differently to the many who dare to become self-employed but then fail? The panelists pointed instantly to an ability to “think solution” and not “think technology,” as well as an ability to see things from the customer angle. Networking is essential for a culture shaped by go-getters. In this regard, the startup scene has become much more proactive in recent years, although things could still be better.
For the final discussion round, the two moderators asked everyone the same question: If they could immediately eliminate one fundamental problem facing startups, what would it be? There were many different answers, ranging from negativity, which acts as a mental block, to barriers and the prejudices that some established companies have towards startups, and even the fear that potential entrepreneurs have of failure. Finally, one important request was made of all people at the arena, both in the audience and among panelists: To use the get-together afterwards for important networking and indeed a number of joint project ideas were explored by participants.
Full video highlights of the Steinbeis Financing Arena can
be viewed by going to the Steinbeis media library at www.finanzierungsarena.de.
Marina Tyurmina
Steinbeis-Stiftung (Stuttgart)
marina.tyurmina@stw.de