bm|t newsletter Q2 2018
Welcome to our second quarterly bm|t newsletter. If you are receiving this newsletter via email, you successfully participated in the GDPR compliance spectacle – thank you for your understanding. If you have partners or colleagues who are interested in a regular bm|t update, don’t hesitate to share this link.
TRUST Isn’t a Four-Letter Word
While recently in Berlin meeting with investors we were engaged in an interesting discussion about Initial Coin Offerings (ICOs). Our conversational counterparty, an early-stage private investor, was advocating how great it would be if all investments had tradeable, blockchain-based tokens, and therefore the annoying problem with illiquidity could be solved. We understand the sentiment behind this thinking, but believe it focuses too narrowly on avoiding the negative effects of a lack of trust and not adequately on the positive effects of the presence of trust.
Trust and Commitment are Critical Success Factors
An important concept behind blockchain / decentralized ledgers is that one can eliminate the need for direct counterparty trust in environments where trust can be difficult to establish. For example, establishing trust between parties that may have never interacted with each other prior to consummating a transaction and when there is a low likelihood of repeat transactions between the parties. There are situations where the ability to remove the need for trust from the equation can be extremely beneficial. However, in our métier of venture capital and private equity, we believe that trust and commitment are actually critical success factors that cannot be outsourced to a faceless, decentralized network.
At bm‑t we have recently recommitted ourselves to working diligently to be the partner-of-choice for our investee-partners. This partnership mindset originates from a deep belief that when entrepreneurs and investors work cooperatively and openly with a common goal that outstanding results can stem from this deep trust and mutual understanding.
We at bm|t do not invest in business plans; we invest in entrepreneurs.
In essence, we aim to find businesspeople who we trust will find a way to create value even when plan A, B, or C does not materialize as originally envisioned. We strongly believe that entrepreneurs should also cultivate and value this trust, which is accompanied by many positive attributes for people and companies with big ambitions – such as patience, cooperation, commitment, and a co-warrior mentality.
Indeed, in our view, entrepreneurs should be very wary of the siren songs of ICOs, instant liquidity, and not having to deal directly with pesky investors, as those investors are exactly the ones who are most likely to support companies when changes to the business plan become necessary or in moments when a category falls out of favor with the crowd.
We at bm|t are working concertedly to create an environment of mutual trust by communicating pro-actively and transparently with our Investee-Partners; and we highly value that same communication in return. We view trust as a valuable long-term asset that can produce great dividends, not something to be outsourced.
Investor Days Thüringen was a successful event again this year, with record investor attendance and over 80 companies presenting their stories. Only time will tell which companies from this year’s class of presenters will be discussing a sale to a social media giant or a Nasdaq IPO as a keynote speaker at future events.
We, and the guests from whom we received feedback, were very impressed by the poise of the presenters and the high level of corporate substance on display. We, in Thüringen, are still flying a bit stealthily, but we are appearing on the radar of more investors and look forward to welcoming even more first-time guests next year at Investor Days Thüringen.
Welcome to the Family
APPsolute Mobility’s two managing founders, Victoria von Wachtel and Alexandra Kulfanová, realized early on that app creation could be made so easy and configurable that more companies would start to design and publish their own apps for internal and external business process optimization. To enable this self-service, APPsolute Mobility has constructed a highly-intuitive and flexible app-development environment.
The software platform is outstanding, and we were very impressed with the founders, as they had already generated substantial revenues and possess a great roadmap for scaling the pure license portion of their business model. There are some big companies competing in the space, but with the right combination of personalized solutions and scalable software, we know › APPsolute Mobility has a lot of headroom for profitable growth.
We are looking forward to working with APPsolute Mobility to enable companies to use self-service App development to improve corporate performance.
Q2 2018 Investment Rounds
InflaRx raises another $ 63 Mio in primary shares
InflaRx (Nasdaq: IFRX) and current shareholders placed $ 117,3 Mio. of shares, with $ 63 Mio. as primary shares with the proceeds going to InflaRx and $ 54 Mio. as secondary shares with the proceeds going to early shareholders, who all remain invested in InflaRx.
InflaRx intends to use of proceeds from the capital raise to finance the further clinical development of its lead candidate IFX‑1, which is currently in Phase IIb. The therapy is being trialed on patients with moderate to advanced Hidradenitis Suppurativa (HS), which is a painful and chronic inflammatory skin disease with limited treatment options. Furthermore, the compound is going to be tested in two phase II trials for additional auto-immune and inflammation indications.
ifesca closes Series A financing with another EUR1.5 million investment
ifesca opened its Series A financing round about six months ago and quickly secured 1 million EUR in the first closing. In the second closing, a further 1.5 million EUR was raised. The total of 2.5 million EUR will enable the company to further grow and internationalize its ifesca.AIVA platform. bm‑t was the lead investor in the Series A financing and was accompanied by multiple private investors.
The intelligent cloud service of ifesca.AVIA, enables energy companies to better forecast future demand for electricity, gas, or heat in near real time. These insights allow energy companies to make better decisions regarding their own generation operations and/or energy trading.
Nanoparticles for life-saving therapies
The Stiftung für Technologie, Innovation und Forschung Thüringen (STIFT) and the Sparkasse Jena-Saale-Holzland invest in an innovative therapeutics company in Jena.
SmartDyeLivery, in Jena, uses nanoparticles to direct therapeutic compounds directly to targeted organs. With a patented technology based on functional nanoparticles, SmartDyeLivery convinced the STIFT to join the Sparkasse Jena-Saale-Holzland, which increased its investment, and bm|t as key institutional shareholders, in the aspiring biotechnology company.