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bm|t newsletter Q3 2022

Founders, espe­cially of star­tups with big ideas, tend to believe that they con­trol their own des­tiny, which is a great men­tal­ity and prob­a­bly a key pre­req­ui­site for being a suc­cess­ful founder. How­ever, every com­pany exists in a set of mar­ket and envi­ron­men­tal con­di­tions. Ide­ally, those con­di­tions are such that com­pa­nies can pre­dom­i­nantly focus on their mis­sion and exe­cu­tion (Alpha) and not be overly con­cerned with broader geopo­lit­i­cal, macro­eco­nomic or finan­cial mar­ket con­di­tions (Beta). How­ever, as any inno­va­tion investor who has been around a while knows, there can be peri­ods (hope­fully brief) when exter­nal con­di­tions are so impact­ful that they must take prece­dence over the inter­nal objec­tives, at least temporarily.

In this Newsletter 

Beware of Beta

This state­ment is not sug­gest­ing that in times of high Beta influ­ence, founders should stop focus­ing on their busi­nesses and become macro-ana­lysts or day-traders. How­ever, this state­ment is say­ing that there are times when ignor­ing the broader pic­ture (no mat­ter how well a com­pany is exe­cut­ing on its inter­nal objec­tives) can lead a com­pany off a cliff. In our view, we are in a period when founders need to be extremely cog­nizant of their envi­ron­ment and the exter­nal fac­tors that are beyond their company’s direct con­trol and need to think more about adjust­ing to those fac­tors rather than focus­ing only on their own work.

When exter­nal fac­tors are fore­bod­ing and most war­rant atten­tion, many peo­ple, under­stand­ably, tend to dou­ble-down on Alpha, focus­ing even more on their micro­cosm and block­ing out the unfriendly envi­ron­ment. At bm|t, we are implor­ing our Investee-Part­ners to resist this nat­ural incli­na­tion to look inward and instead to engage in rig­or­ous stress test­ing and sce­nario plan­ning to ensure that the progress made toward achiev­ing com­pany goals is not lost by being caught off-guard when a storm strikes.

In the cur­rent envi­ron­ment, storms can come in many forms: sup­ply-chain prob­lems, infla­tion-related chal­lenges, energy cost dif­fi­cul­ties, etc. And in the start-up world, where most com­pa­nies are reliant on addi­tional investor fund­ing for sur­vival, a clear and present dan­ger is a dry­ing up of the fund­ing mar­kets. To assess this risk, founders need to com­mu­ni­cate openly with cur­rent investors and con­duct exten­sive sce­nario plan­ning together. If the exist­ing investors are not in a posi­tion to con­tinue fund­ing the cur­rent burn rate, and it is not absolutely clear which new investors will be invest­ing in the com­pany, then all mea­sures to extend a company’s run­way need to be analyzed.

It can be extremely frus­trat­ing, espe­cially for com­pa­nies that are exe­cut­ing well, to have to mod­ify their plans; how­ever, there are times when it is crit­i­cal to do so. Founders should not per­ceive this rethink­ing, espe­cially if it is investor-induced, as an affront but rather should under­stand it as an attempt to pre­serve and pro­tect the value that has been cre­ated and to main­tain the company’s abil­ity to reach its poten­tial (albeit per­haps on a delayed timeframe).

Steve Jobs pro­mul­gated that to be an excel­lent founder one has to be able to use both the periscope and the tele­scope. The periscope pro­vides a view of the imme­di­ate sur­round­ings, and the tele­scope allows sight fur­ther afield. The best founders are always using both tools/approaches, and right now is a time when it is imper­a­tive to keep at least one eye look­ing through the telescope.

Your bm|t Team

Welcome to the Family

Robotic agri­cul­ture is undoubt­edly a mega trend, and Weimar based E‑Terry aims to make a large impact in the rapidly grow­ing space with its extremely ver­sa­tile and light field robot. E‑Terry’s robot will ini­tially tar­get veg­etable fields and is able to tra­verse large areas while mak­ing use of mul­ti­ple func­tion­al­i­ties like weed recog­ni­tion and removal as well as crop mon­i­tor­ing. The company’s busi­ness model treats the robot as a plat­form with an open source approach to the hard­ware and soft­ware mod­ules that can be added to increase the robot’s util­ity. With top tier cor­po­rate devel­op­ment part­ners already on board, we are con­fi­dent E‑Terry is well posi­tioned to quickly move for­ward in the robotic agri­cul­ture sec­tor. bm|t led this seven-fig­ure seed round focused on final­iz­ing the tech­nol­ogy and con­duct­ing ini­tial sales and was joined by sev­eral expe­ri­enced busi­ness angels.

Democ­ra­tiz­ing the power of arti­fi­cial intel­li­gence (AI) by mak­ing it acces­si­ble through an intu­itive user inter­face (UI) with drag and drop func­tion­al­ity (no code), and thus allow­ing com­pa­nies that do not have large IT depart­ments to ben­e­fit from AI, is the promis­ing goal of Ilme­nau based AI/UI. The company’s tech stack is already mar­ket tested, and the appli­ca­tions are nearly lim­it­less and highly-applic­a­ble for a broad swath of com­pa­nies. Early top-tier part­ners have focused on qual­ity assur­ance appli­ca­tions, and are quickly expand­ing their use of the tech­nol­ogy to addi­tional use cases. Com­panisto and bm|t led this seven-fig­ure seed round focused on quickly gain­ing mar­ket trac­tion for AI/UI’s easy-to-roll­out SaaS offering.

Follow-on Investments

As the num­ber of IT-End­points grows rapidly, it can be extremely dif­fi­cult for IT depart­ments to main­tain an overview of secu­rity, per­for­mance, and avail­abil­ity of all IT assets. Jena based Engin­sight’s suite of cyber­se­cu­rity tools works in a well-coor­di­nated man­ner to mon­i­tor all IT-End­points in real time and pre­cisely and suc­cinctly dis­play the results to IT staff. Whether it involves servers, desk­tops, lap­tops, tablets, smart­phones, or web­sites, Engin­sight main­tains a con­stant overview of an organization’s IT infra­struc­ture. Smart Infra­struc­ture and bm|t led this round focused on con­tin­u­ing Enginsight’s rapid growth, and we were joined by Seed & Speed and mul­ti­ple busi­ness angels.

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ALSO SEE OUR OTHER NEWSLETTERS

Q4 2021 | Jan­u­ary 25, 2022
Q3 2021 | Octo­ber, 25 2021
Q2 2021 | July, 22 2021
Q1 2021 | April, 15 2021
Q4 2020 | Jan­u­ary, 22 2021
Q3 2020 | Octo­ber, 20 2020
Q2 2020 | Juli, 17 2020
Q1 2020 | April, 17 2020
Q4 2019 | Jan­u­ary, 15 2020
Q3 2019 | Octo­ber, 17 20019
Q2 2019 | August, 14 2019
Q1 2019 | May, 3 2019
Q4 2018 | Feb­ru­ary, 4 2019
Q3 2018 | Octo­ber, 16 2018
Q2 2018 | July, 23 2018
Q1 2018 | May, 24 2018