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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