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bm|t newsletter Q4 2018

We recently wat­ched a video on Lin­kedIn that showed two marbles racing from an iden­ti­cal star­ting height down dif­fe­rent paths to the same finish line. One marble tra­v­eled a strai­ght line the ent­ire way and the other marble tra­v­eled on an expo­nen­tial curve, first fal­ling rapidly and then flat­tening out its trajectory.

In this Newsletter

Momentum and Nonlinearities

In the example men­tio­ned above, the marble that more quickly trans­for­med its poten­tial energy into kine­tic energy was able to carry its gai­ned momen­tum through the flat sec­tion and won the race. We quickly drew par­al­lels to the busi­ness world and the impor­t­ance of momen­tum and non-linear approa­ches to reaching the ulti­mate goal. To para­phrase Isaac New­ton, busi­nes­ses at rest tend to stay at rest, and busi­nes­ses in motion tend to stay in motion.

While momen­tum plays a cri­ti­cal role for all busi­nes­ses, startup momen­tum is perhaps the most inte­res­ting phe­no­me­non, as a small group of pas­sio­nate people is tas­ked with not just kee­ping a busi­ness moving but star­ting it from a standstill point of zero iner­tia. Big vision. High poten­tial energy. No kine­tic energy.

Quickly genera­ting kine­tic energy is essen­tial for most star­tups not only to grow and pro­sper but also to avoid com­ple­tely losing momen­tum when the busi­ness encoun­ters the ine­vi­ta­ble bumps in the road. Many stra­te­gies and tac­tics are employed to create this momen­tum: hiring more key employees than the cur­rent busi­ness size might war­rant; signing up beta cus­to­mers at low, zero, or nega­tive mar­gins in order to acce­le­rate lear­ning and mar­ket accep­t­ance; enga­ging in bold part­ners­hips or acqui­si­ti­ons to trans­form a tech­no­logy offe­ring; rai­sing more capi­tal than a linear tra­jec­tory would require, etc. We at bm|t greatly admire entre­pre­neurs who can trans­form energy and create busi­ness momen­tum, and we aim to play a signi­fi­cant role in cata­ly­zing the nee­ded momentum.

We believe the key is reco­gni­zing when line­arly boot­strap­ping a busi­ness is indeed ris­kier than con­sciously crea­ting (indeed some­ti­mes for­cing) momen­tum – maybe even more than one can com­for­ta­bly con­trol. Of course, each busi­ness is uni­que and the art surely lies in knowing when is the right time to gene­rate grea­ter momen­tum – cer­tainly one wants to be on an expo­nen­tial curve, not just fal­ling off a cliff. We, at bm|t, believe we can help young busi­nes­ses pro­perly time and plan their acce­le­ra­ti­ons in order to have the grea­test pro­ba­bi­lity of being on the right growth curve.

Like entre­pre­neurs, inves­tors can also capi­ta­lize on the phe­no­mena of momen­tum and non­linea­rity. In 2018, bm|t worked dili­gently to trans­form the power­ful 2017 events of fayteq’s sale and InflaRx’s Nasdaq IPO into broad-based energy for all inves­tee-part­ners and Thü­rin­gen. The results were out­stan­ding, as our inves­tee-part­ners rai­sed over 100 Mio. EUR in capi­tal, and we were able to gain a record num­ber of 16 new inves­tee-part­ners. You can read fur­ther about the strong momen­tum in 2018 here.

Before pre­sen­ting the quarter’s invest­ment acti­vity and other signi­fi­cant news, we would like to offer a big THANK YOU to our great inves­tee-part­ners and co-inves­tors. Working with such bril­li­ant, moti­va­ted, visio­nary people is the fuel that pro­pels us forward!

Your bm|t Team

Welcome to the Family

Smart­Dye­Li­very deve­lops func­tio­n­a­li­zed nano­par­ti­cles in which the­ra­peu­tic com­pounds are enve­lo­ped and safely trans­por­ted to spe­ci­fic organs, which the medi­ci­nes are tar­ge­ting. This paten­ted plat­form deli­very tech­no­logy can be uti­li­zed in a wide range of the­ra­peu­tic app­li­ca­ti­ons and also allows for a uni­que thera­nostic use case. Cur­r­ently, the Smart­Dye­Li­very team is focu­sing on a the­rapy for sep­sis-indu­ced liver fail­ure with the goal of redu­cing the mor­ta­lity rate of such cases by 90%. With this multi-mil­lion invest­ment from bm|t, a renow­ned family office, the STIFT, and several savvy busi­ness angels, Smart­Dye­Li­very is well posi­tio­ned to take its uni­que nano­the­rapy through phase one cli­ni­cal trials.

Jena based Tro­pho­SYS is deve­lo­ping a new inno­va­tive method for the gen­der-spe­ci­fic selec­tion of pro­duc­tive ani­mals, which could dra­ma­ti­cally improve pro­duc­ti­vity and enhance food secu­rity, all while making a signi­fi­cant con­tri­bu­tion to the ethi­cal hand­ling of ani­mals.  Import­antly, the inno­va­tion is based solely on the phy­sio­lo­gi­cal dif­fe­ren­ces of the cell sur­faces and allows for the gamete sepa­ra­tion without any mani­pu­la­tion of gene­tic mate­rial.  Deve­lo­p­ment of the tech­no­logy is ongo­ing and, when suc­cess­ful, will no doubt make a tre­men­dous impact on the pro­duc­tive ani­mal sector.

read more ›

Erfurt based Smart­platz has an ambi­tious plan to take on com­pa­nies like Ama­zon by enab­ling loca­li­ties to regain phy­si­cal retail cus­to­mers from the online world.  The com­pany has deve­lo­ped a sleek app and backend inter­face that allows cus­to­mers to quickly per­use local offe­rings and expe­ri­ence the ease and seren­di­pity of the online expe­ri­ence to locate and dis­co­ver desi­red pro­ducts and ser­vices.  Smart­platz has inte­gra­ted a uni­que incen­tive pro­gram that keeps cus­to­mers enga­ged and links local busi­nes­ses tog­e­ther in new ways.  The topic is timely, the mar­ket is huge, and if Smart­platz achie­ves cri­ti­cal mass, the rewards for cus­to­mers, retailers, and the com­pany will be great.

Follow-on Investments

Leyh Pharma has an attrac­tive busi­ness model that is only address­able by pharma indus­try experts.  The com­pany purcha­ses off-patent or over-the-coun­ter (OTC) medi­ca­ti­ons, gene­rally from lar­ger pharma com­pa­nies that are nar­ro­wing the focus of their port­fo­lios, and crea­tes value by exten­ding the mar­ket reach and life of the pro­ducts with rene­wed focus.  The busi­ness is well mana­ged and highly pre­dic­ta­ble, and the com­pany has a suc­cess­ful track record with its stra­tegy.  bm|t inves­ted via its Mit­tel­stands-Fonds Thü­rin­gen (MFT), which is focu­sed on finan­cing estab­lis­hed com­pa­nies on strong growth paths.

Jena based mi2-Fac­tory is one of the deepest tech com­pa­nies in bm|t’s port­fo­lio.  The com­pany is spe­cia­li­zed on phe­no­me­n­ally accu­rate and struc­tu­red ion implan­ta­tion in sili­con car­bide wafers, which dra­ma­ti­cally enhan­ces the per­for­mance of the micro­chips.  mi2-Fac­tory already col­la­bo­ra­tes with many of the top chip manu­fac­tu­rers on cut­ting edge R&D pro­jects.  The signs are good that the mar­ket will move to sili­con car­bide chips in the future for cer­tain app­li­ca­ti­ons that require high vol­ta­ges, such as many rene­wa­ble energy and e‑mobility app­li­ca­ti­ons.  mi2-Fac­tory is extre­mely well posi­tio­ned to con­tri­bute signi­fi­cantly to and capi­ta­lize greatly on the rise of sili­con car­bide chips.

read more ›

BAND Membership

For our early-stage invest­ments, busi­ness angels have become our num­ber one source of co-invest­ment over the last years.  bm|t and our inves­tee-part­ners bene­fit tre­men­dously from the expe­ri­ence, gui­d­ance, and net­works that these inves­tors bring to the table.  We have had great results working with the dedi­ca­ted and pas­sio­nate busi­ness angels who we cur­r­ently have as co-inves­tors, and we are making a con­cer­ted effort to fur­ther expand our angel net­work.  We are con­nec­ting to various angel orga­niz­a­ti­ons around the DACH region, inclu­ding BAND (Busi­ness Angel Net­work Deutsch­land) where bm|t is now a full-pled­ged mem­ber.  Our goals are clear: incre­ase the amount of pri­vate capi­tal inves­ted in Thü­rin­gen and fur­ther improve the stra­te­gic fit bet­ween angels and inves­tee-part­ners.  We are loo­king for­ward to mee­ting and working with many more great busi­ness angels in the years ahead!

Investor Days Thüringen 2019

We are thril­led to again be co-hos­ting Inves­tor Days Thü­rin­gen with the STIFT on June 18th and 19th, 2019. Please mark your calen­dars and join us in see­ing over 60 inno­va­tive startup and growth com­pa­nies.  This year, all the com­pany pit­ches and pre­sen­ta­ti­ons will take place on June 18th, and June 19th will be dedi­ca­ted to work­shops for com­pa­nies and inves­tors.  We encou­rage all par­ties inte­res­ted in dis­co­vering com­pel­ling, under-the-radar invest­ments to join us in Erfurt for IDT 2019!  More details will be forth­co­m­ing on our web­site and Lin­kedIn & Xing pages – if you are not yet con­nec­ted with bm|t please link up with us!

If your part­ners or col­leagues might be inte­res­ted in our regu­lar updates,
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ALSO SEE OUR OTHER NEWSLETTERS

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