Latest / Startup & Tech News from Germany, Austria, and Switzerland by Startuprad.io™ / German Green-Tech Venture Capital: Wolfgang Krause of Hi Inov
Transcript
- WEBVTT 00:00:00.000 --> 00:00:17.360 <v Music> 00:00:17.206 --> 00:00:17.426 <v Speaker0>Fits. 00:00:20.006 --> 00:00:25.326 <v Speaker1>Hello and welcome everybody. This is Joe from StartupRate.io bringing you another 00:00:25.326 --> 00:00:28.146 <v Speaker1>episode from the German-speaking entrepreneurship scene. 00:00:28.586 --> 00:00:32.726 <v Speaker1>Today I would like to welcome Wolfgang here with me. Hey Wolfgang, how are you doing? 00:00:33.406 --> 00:00:36.866 <v Speaker0>Hi, lovely to be at this podcast. 00:00:37.506 --> 00:00:41.946 <v Speaker1>Totally my pleasure. Before we dive into startups and investment philosophy, 00:00:42.286 --> 00:00:47.386 <v Speaker1>let's zoom out. DACH is becoming one of Europe's strongest engines for green tech innovation. 00:00:48.006 --> 00:00:54.466 <v Speaker1>And High Innoff's Green Tech Mapping 2025 gives us an inside look at what's coming next. 00:00:54.706 --> 00:00:58.606 <v Speaker1>So Wolfgang, let's get into the data, the deals and the future. 00:01:00.606 --> 00:01:07.086 <v Speaker1>Maybe before we do that, could you tell us just a tiny bit about who you are 00:01:07.086 --> 00:01:13.826 <v Speaker1>and what you do and what high enough is before we get into what you really did with green techs there. 00:01:14.626 --> 00:01:23.686 <v Speaker0>Absolutely. So we are a German-French B2B venture fund. We mainly focus on Series A investments. 00:01:23.786 --> 00:01:29.986 <v Speaker0>We are on the market now for more than 10 years, just investing our third generation. 00:01:30.326 --> 00:01:38.186 <v Speaker0>We specialize on deep tech and true B2B technology. So everything which helps 00:01:38.186 --> 00:01:43.426 <v Speaker0>enterprises to become more digital, become more efficient. This is our investment themes. 00:01:44.066 --> 00:01:48.506 <v Speaker0>Basically, we invest in five main area. One, obviously, we are going to talk 00:01:48.506 --> 00:01:50.146 <v Speaker0>about that is screen tech. 00:01:50.426 --> 00:01:56.026 <v Speaker0>We do what we call compliance. So leveraging all the European regulation and 00:01:56.026 --> 00:01:59.706 <v Speaker0>what kind of interesting business models coming out of that. 00:02:00.586 --> 00:02:07.426 <v Speaker0>We traditionally, as a team, we have a deep expertise in everything, which is data, big data. 00:02:07.686 --> 00:02:14.286 <v Speaker0>You know, obviously now with AI, things are moving quite quickly and really shaping the industry. 00:02:14.546 --> 00:02:19.466 <v Speaker0>We do cyber, also a little bit with a defense angle. 00:02:19.706 --> 00:02:26.426 <v Speaker0>And then we do something what we call new work. New work is basically, you know, 00:02:26.686 --> 00:02:31.986 <v Speaker0>technologies who reshape the workspace, like, you know, remote working, 00:02:32.226 --> 00:02:39.246 <v Speaker0>collaborative tools, but also HR developments, because our thesis is that people, 00:02:39.246 --> 00:02:43.486 <v Speaker0>they just, you know, are looking for a sense in work, you know, 00:02:43.566 --> 00:02:47.006 <v Speaker0>probably a little bit different than 20 or 30 or 40 years ago. 00:02:47.006 --> 00:02:52.566 <v Speaker0>And so a lot of companies are also focusing on education and on, 00:02:52.566 --> 00:02:56.806 <v Speaker0>you know, other HR related topics. 00:02:57.066 --> 00:02:59.946 <v Speaker0>So these are our five main investment themes. 00:03:02.235 --> 00:03:06.295 <v Speaker1>I was wondering when I first read the pitch for the content, 00:03:06.475 --> 00:03:12.895 <v Speaker1>I was wondering what inspired you to do the screen tech software mapping? 00:03:13.995 --> 00:03:19.175 <v Speaker1>I assume it was not that you were bored and you didn't have already more than enough work. 00:03:19.315 --> 00:03:22.655 <v Speaker1>How did you get started? What was the trigger to do the screen tech mapping? 00:03:23.755 --> 00:03:27.615 <v Speaker0>Well, actually, this is not the first screen tech mapping we are doing. 00:03:27.615 --> 00:03:32.255 <v Speaker0>We did it two years ago in 2023 as well. 00:03:32.435 --> 00:03:38.435 <v Speaker0>At that time, it wasn't green tech. It was more called DACH Climate Tech Mapping, which kind of evolved. 00:03:38.795 --> 00:03:45.175 <v Speaker0>I think for us, it's very important to understand the industries we would like 00:03:45.175 --> 00:03:49.355 <v Speaker0>to invest and to understand the broader context, to understand the players, 00:03:49.555 --> 00:03:50.755 <v Speaker0>to understand the ecosystem. 00:03:51.235 --> 00:03:55.535 <v Speaker0>And we do that for all of our five investment areas. 00:03:56.215 --> 00:04:00.595 <v Speaker0>So green tech obviously is very important to us. And therefore, 00:04:00.695 --> 00:04:03.195 <v Speaker0>we just would like to have a good view on the market. 00:04:03.435 --> 00:04:08.895 <v Speaker0>And to be very frank, it's also kind of a marketing tool because we really want 00:04:08.895 --> 00:04:10.935 <v Speaker0>to tell the market, hey, we are there. 00:04:11.155 --> 00:04:13.075 <v Speaker0>We are interested in that space 00:04:13.075 --> 00:04:19.115 <v Speaker0>and we think there's a lot of interesting investments to do in this space. 00:04:20.295 --> 00:04:26.275 <v Speaker1>I assume we will link down here in the show notes to the Queen Tech software 00:04:26.275 --> 00:04:28.835 <v Speaker1>mapping, just having it here on the other screen. 00:04:29.635 --> 00:04:35.955 <v Speaker1>One of the big areas is carbon footprint monitoring with energy transition tools, 00:04:36.175 --> 00:04:41.815 <v Speaker1>with circular economy, raw materials optimization and corpo initiatives. 00:04:42.555 --> 00:04:46.635 <v Speaker1>Given that and that it already had a different name in the past, 00:04:47.155 --> 00:04:53.815 <v Speaker1>can you tell us from your perspective what were the three most surprising findings 00:04:53.815 --> 00:04:57.715 <v Speaker1>you had in 2025 versus 2023? 00:04:59.013 --> 00:05:05.173 <v Speaker0>Well, I think, and, you know, I really looked it up in 23 and looked at what really has changed. 00:05:05.313 --> 00:05:08.613 <v Speaker0>You know, obviously, is this a surprise? Probably it's not a surprise. 00:05:09.333 --> 00:05:12.993 <v Speaker0>The map got richer. You know, many more logos on the map. 00:05:13.913 --> 00:05:16.573 <v Speaker0>The ecosystem is really evolving quite a bit. 00:05:18.573 --> 00:05:25.333 <v Speaker0>But what's also interesting, you know, there's a reason why we did green tech software mapping. 00:05:25.533 --> 00:05:28.153 <v Speaker0>And at the time, we call it climate tech mapping. 00:05:29.013 --> 00:05:35.873 <v Speaker0>I think it also becomes clearer and clearer what are really the trends and the 00:05:35.873 --> 00:05:39.793 <v Speaker0>investment topics software investors could be interested in. 00:05:40.973 --> 00:05:48.553 <v Speaker0>When I basically, you know, two years ago, we had nine sectors and they were 00:05:48.553 --> 00:05:52.913 <v Speaker0>called recycling, reporting, deep tech, digital twin battery. 00:05:52.913 --> 00:06:01.153 <v Speaker0>So it basically was more like a mapping around specific solutions, 00:06:01.453 --> 00:06:02.553 <v Speaker0>specific technologies. 00:06:02.933 --> 00:06:09.173 <v Speaker0>But I think now, you know, the more the ecosystem evolving, it is clear that 00:06:09.173 --> 00:06:13.053 <v Speaker0>it's not so much about specific technologies. 00:06:13.053 --> 00:06:19.253 <v Speaker0>It's more about there is different areas, people trying to find solutions, 00:06:19.533 --> 00:06:23.673 <v Speaker0>you know, whether it's with technology, whether it's with, you know, other business models. 00:06:24.253 --> 00:06:29.853 <v Speaker0>And so I think the surprising or kind of the new methodology is more looking 00:06:29.853 --> 00:06:34.173 <v Speaker0>at from a user perspective rather from a technology perspective because we see 00:06:34.173 --> 00:06:35.873 <v Speaker0>real usage of these technologies. 00:06:37.318 --> 00:06:42.358 <v Speaker1>Talked about the real usage. We already talked about the different categories here. 00:06:43.298 --> 00:06:49.558 <v Speaker1>Which of those categories do you believe is gaining the fastest traction in the DACH area? 00:06:49.778 --> 00:06:58.038 <v Speaker0>Actually, that's kind of a tricky question because I think, and we even have 00:06:58.038 --> 00:06:59.398 <v Speaker0>real-life examples, and maybe 00:06:59.398 --> 00:07:03.138 <v Speaker0>later on a few examples, I can elaborate on these real-life examples. 00:07:03.318 --> 00:07:09.178 <v Speaker0>I think it all is kind of interwoven and kind of linked together, 00:07:09.498 --> 00:07:12.758 <v Speaker0>talking about carbon measurement. 00:07:13.878 --> 00:07:18.918 <v Speaker0>You would think it's very easy and very, very trivial to measure carbon, 00:07:19.758 --> 00:07:21.318 <v Speaker0>the carbon footprint. It's not. 00:07:21.618 --> 00:07:26.778 <v Speaker0>You know, just ask AWS and ask, you know, what's basically the carbon footprint 00:07:26.778 --> 00:07:29.338 <v Speaker0>of your data center. They don't know. They simply don't know. 00:07:30.098 --> 00:07:35.438 <v Speaker0>So, and when you don't have kind of the tools to measure impact, 00:07:35.438 --> 00:07:40.198 <v Speaker0>How, you know, can you achieve corporate sustainability? 00:07:41.158 --> 00:07:45.138 <v Speaker0>How can you really kind of achieve energy transition and circular economy? 00:07:45.398 --> 00:07:53.298 <v Speaker0>So I think what's happening right now is, you know, there's an underlying layer 00:07:53.298 --> 00:07:57.538 <v Speaker0>of measurements of technologies developed, you know, then obviously. 00:07:57.538 --> 00:08:02.918 <v Speaker0>And then on top of that, you know, once they really understand the problem, 00:08:03.418 --> 00:08:05.978 <v Speaker0>new technologies emerge to solve these problems. 00:08:06.258 --> 00:08:13.798 <v Speaker0>So I wouldn't really make a bet, you know, what of these four areas are growing the fastest. 00:08:14.738 --> 00:08:16.098 <v Speaker0>Put it like this. 00:08:17.158 --> 00:08:22.138 <v Speaker0>When you look at market volume, you know, obviously energy transition is a huge 00:08:22.138 --> 00:08:28.818 <v Speaker0>market. You know, it's a multi-billion euro market and it's huge investment model. 00:08:28.998 --> 00:08:33.338 <v Speaker0>When it comes about carbon measurement, you know, these are kind of software, 00:08:33.618 --> 00:08:35.138 <v Speaker0>you know, which are used. 00:08:35.318 --> 00:08:41.858 <v Speaker0>But so when you look at, I wouldn't call that as big as a market as carbon as energy transition. 00:08:42.118 --> 00:08:45.638 <v Speaker0>So I think when it comes to volume, you know, obviously there's a difference. 00:08:45.758 --> 00:08:49.358 <v Speaker0>But what's going to be most active and picking up? Hard to say. 00:08:52.622 --> 00:08:54.282 <v Speaker1>Mm-hmm, I see. 00:08:56.622 --> 00:09:03.482 <v Speaker1>I was wondering for our audience, if you're building green tech startup in the 00:09:03.482 --> 00:09:07.742 <v Speaker1>DACH region or want to invest in one, drop your thoughts in the comment. 00:09:08.002 --> 00:09:12.562 <v Speaker1>What trends do you believe will dominate by 2026? 00:09:13.322 --> 00:09:16.622 <v Speaker1>Going a little bit into trends and technologies. 00:09:17.842 --> 00:09:25.102 <v Speaker1>What role is generative AI already play in green tech software and how do you see it evolving? 00:09:26.022 --> 00:09:34.602 <v Speaker0>I think that's a broader question because AI is just changing the way how to 00:09:34.602 --> 00:09:37.582 <v Speaker0>develop, how to propose software, 00:09:37.962 --> 00:09:43.982 <v Speaker0>how to structure software and how to go to market. That's the general trend. 00:09:44.542 --> 00:09:49.422 <v Speaker0>There's an entire layer of engineers, of software engineers and programmers 00:09:49.422 --> 00:09:52.582 <v Speaker0>which aren't used, you know, aren't necessary anymore. 00:09:53.122 --> 00:09:57.562 <v Speaker0>With AI, you can create wow effects to customers, even to investors. 00:09:57.922 --> 00:10:01.182 <v Speaker0>And when you really go under the cover, you understand, well, 00:10:01.302 --> 00:10:04.942 <v Speaker0>you know, it's basically a very smart application of an AI technology, 00:10:04.942 --> 00:10:09.662 <v Speaker0>you know, of an AI model in order to come up with answers, 00:10:09.942 --> 00:10:15.362 <v Speaker0>which are probably very nice to have, but probably not very kind of sustainable 00:10:15.362 --> 00:10:17.322 <v Speaker0>when it comes to a clear differentiator. 00:10:17.902 --> 00:10:21.622 <v Speaker0>So I think the market, especially when it comes to software investment, 00:10:21.902 --> 00:10:24.022 <v Speaker0>is changing dramatically right now. 00:10:24.402 --> 00:10:31.502 <v Speaker0>And obviously, that impacts screen tech software because, you know, 00:10:31.582 --> 00:10:37.122 <v Speaker0>it's so much easier on the one side to visualize. 00:10:37.782 --> 00:10:44.342 <v Speaker0>To get answers, to gather data, to really try to make sense out of what you're 00:10:44.342 --> 00:10:46.782 <v Speaker0>gathering, what you're trying to achieve. 00:10:47.202 --> 00:10:56.162 <v Speaker0>But on the other side, it's also a little bit tricky because you really have to think very hard, 00:10:56.402 --> 00:11:03.762 <v Speaker0>you know, what is really the value add you're offering to customers, you know, 00:11:03.882 --> 00:11:12.502 <v Speaker0>to the landscape, which goes beyond AI, because AI at the end of the day, 00:11:12.762 --> 00:11:16.102 <v Speaker0>I think it's more a tool. It's not a solution per se. 00:11:16.462 --> 00:11:20.262 <v Speaker0>So I think it's getting a little bit more complex when you think, 00:11:20.402 --> 00:11:22.862 <v Speaker0>you know, what's really the value proposition you want to invest. 00:11:23.642 --> 00:11:29.122 <v Speaker0>And that's true for green tech, you know, as well as for a lot of other kind of sectors. 00:11:33.330 --> 00:11:36.490 <v Speaker1>I have been observing this space for quite some time. 00:11:37.010 --> 00:11:41.930 <v Speaker1>And for example, what was one of the things that happened in the past was, 00:11:42.070 --> 00:11:45.670 <v Speaker1>for example, a cloud took over. 00:11:45.890 --> 00:11:50.550 <v Speaker1>And at one moment, everybody was a cloud first startup. I do believe that's 00:11:50.550 --> 00:11:53.710 <v Speaker1>now so essential. Nobody talks about that anymore. 00:11:54.010 --> 00:11:58.990 <v Speaker1>All startups are more or less cloud based. Do you think it will be the same 00:11:58.990 --> 00:12:03.490 <v Speaker1>way with AI that almost every startup in one way or another, 00:12:03.870 --> 00:12:06.730 <v Speaker1>especially software, will include AI? 00:12:07.310 --> 00:12:12.530 <v Speaker0>Absolutely. I think it's always like, obviously, now when you have a pitch, 00:12:12.830 --> 00:12:18.650 <v Speaker0>when you get business plans, the headline is always AI. 00:12:19.290 --> 00:12:23.750 <v Speaker0>It seems like, you know, nobody even dares to ask for money or really build 00:12:23.750 --> 00:12:27.550 <v Speaker0>a business model if AI isn't in the headline. 00:12:29.030 --> 00:12:33.730 <v Speaker0>But at the end of the day, it's a technology. It's basically a technology which 00:12:33.730 --> 00:12:41.770 <v Speaker0>makes a lot of things easier, faster, which basically creates new opportunity. 00:12:42.150 --> 00:12:46.610 <v Speaker0>But at the end of the day, it's a tool and it will become a standard. 00:12:46.610 --> 00:12:49.950 <v Speaker0>It will become a standard, you know, in developing software. 00:12:49.950 --> 00:12:56.790 <v Speaker0>It will be a standard when you request information, when you create a user interface, 00:12:57.090 --> 00:12:58.110 <v Speaker0>a look and feel interface. 00:12:58.710 --> 00:13:02.750 <v Speaker0>And I'm pretty sure that in two or three years, um, 00:13:04.190 --> 00:13:10.730 <v Speaker0>The pitches won't have AI in the headline, but it will be deeply interwoven 00:13:10.730 --> 00:13:13.490 <v Speaker0>into any solutions startups offer. 00:13:14.550 --> 00:13:16.990 <v Speaker1>Talking about solutions here, 00:13:17.170 --> 00:13:24.790 <v Speaker1>you're also tracking startups using vertical software tools like DeepKey 00:13:25.470 --> 00:13:33.310 <v Speaker1>to meet ESG and CSRD requirements more effectively than horizontal platforms. 00:13:35.070 --> 00:13:39.690 <v Speaker0>Well, I think that's just, you know, how it is. 00:13:39.810 --> 00:13:44.310 <v Speaker0>I think if you really want to be successful, you have to be an expert in the 00:13:44.310 --> 00:13:48.830 <v Speaker0>domain you're doing, especially when it comes to data plays. 00:13:51.130 --> 00:13:54.870 <v Speaker0>And by the way, that's also the big opportunity startups have, 00:13:55.090 --> 00:13:59.170 <v Speaker0>you know, compared to all these horizontal players, the big Silicon Valley giants 00:13:59.170 --> 00:14:01.530 <v Speaker0>and the guys who develop the LLMs. 00:14:03.470 --> 00:14:09.950 <v Speaker0>Really having a specific industry expertise and really understanding the data 00:14:09.950 --> 00:14:12.990 <v Speaker0>sets and data requirements of that specific industry. 00:14:13.210 --> 00:14:18.910 <v Speaker0>In the case of Deepkey, that's really an investment we are very proud of because, 00:14:19.210 --> 00:14:25.630 <v Speaker0>you know, we don't call it startup anymore. It's a real scale-up. 00:14:26.410 --> 00:14:31.570 <v Speaker0>They are now the European-wide leader when it comes to measuring the carbon 00:14:31.570 --> 00:14:37.410 <v Speaker0>footprint in the building industry or the management of buildings. 00:14:37.650 --> 00:14:47.370 <v Speaker0>And that requires not only the ability to know how to measure a carbon footprint, how to display, 00:14:47.610 --> 00:14:53.590 <v Speaker0>how to organize it, but it also requires an in-depth knowledge of the industry. 00:14:53.590 --> 00:14:59.470 <v Speaker0>And typically, horizontal platforms simply don't do that. 00:15:00.814 --> 00:15:05.694 <v Speaker0>Because that's not what they are built for. They are general purpose platforms. 00:15:06.734 --> 00:15:10.634 <v Speaker0>And people probably would use it as a tool to build their own solution. 00:15:10.894 --> 00:15:14.934 <v Speaker0>But they really don't address a very, very specific industry. 00:15:15.234 --> 00:15:16.834 <v Speaker0>Actually, I've rarely seen that. 00:15:17.514 --> 00:15:23.094 <v Speaker0>So, you know, there is a premium for industry knowledge, sector knowledge. 00:15:23.434 --> 00:15:27.654 <v Speaker0>And you can build true market leaders when you have that knowledge. 00:15:27.654 --> 00:15:32.714 <v Speaker1>So your mapping is not only a graphics, it's also a document. 00:15:32.914 --> 00:15:40.454 <v Speaker1>And when I went through it, you mentioned 216,000 tons of CO2 savings impact. 00:15:40.814 --> 00:15:46.394 <v Speaker1>How did you calculate that? And what does it signal about the market maturity? 00:15:46.934 --> 00:15:51.914 <v Speaker0>Well, I have to say, when I read that, I was asking the question to myself. 00:15:51.914 --> 00:15:57.954 <v Speaker0>And then I really ask also my team, it's what DeepKey basically has on its website. 00:15:58.214 --> 00:16:00.574 <v Speaker0>So they track it very closely. 00:16:00.954 --> 00:16:05.034 <v Speaker0>They are together with another company. We have an output for a platform as 00:16:05.034 --> 00:16:08.474 <v Speaker0>H, one of our B Corp companies. 00:16:08.674 --> 00:16:13.174 <v Speaker0>And they are a first mover, obviously, because it's a solution to really track 00:16:13.174 --> 00:16:20.234 <v Speaker0>and to really kind of find a way how to measure carbon reductions. 00:16:20.914 --> 00:16:26.354 <v Speaker0>They have created a tool around that. And now, obviously, they publicly communicate 00:16:26.354 --> 00:16:28.534 <v Speaker0>about it. I think it's quite massive. 00:16:29.734 --> 00:16:33.534 <v Speaker0>And I think it's also a trusted number. 00:16:34.454 --> 00:16:40.134 <v Speaker0>You know, often, as said, you know, ask AWS what's their carbon footprint, 00:16:40.574 --> 00:16:48.354 <v Speaker0>you know, how much a gigabyte of data request really admits in carbon and CO2. 00:16:48.614 --> 00:16:51.334 <v Speaker0>It's pretty hard and pretty tough for them to say. 00:16:53.214 --> 00:16:56.434 <v Speaker0>At least at Deepkey, that was a focus early on. 00:16:57.178 --> 00:16:57.898 <v Speaker1>Mm-hmm. 00:16:59.898 --> 00:17:03.478 <v Speaker1>Let's talk a little bit about the DACH-specific context. 00:17:04.898 --> 00:17:09.818 <v Speaker1>Usually when you look into something like that, you see strengths and weaknesses 00:17:09.818 --> 00:17:11.798 <v Speaker1>in the DACH startup ecosystem. 00:17:12.038 --> 00:17:17.158 <v Speaker1>Where do you see that, especially when it comes to scaling innovations? 00:17:19.318 --> 00:17:25.798 <v Speaker0>I think what's specific, and obviously I can compare a little bit because we 00:17:25.798 --> 00:17:27.998 <v Speaker0>are equally investing in Germany and in France. 00:17:29.398 --> 00:17:33.818 <v Speaker0>I think in Germany, there's kind of this first mover mindset. 00:17:36.058 --> 00:17:41.478 <v Speaker0>And people, you know, embrace, have always embraced that very early on. 00:17:41.818 --> 00:17:46.698 <v Speaker0>For example, when I compared the DAG mapping in 2023 to the French mapping, 00:17:46.698 --> 00:17:51.038 <v Speaker0>I think I see a little bit more logos on the DAG side, you know, 00:17:51.078 --> 00:17:52.538 <v Speaker0>just, you know, a pure number game. 00:17:52.538 --> 00:17:57.258 <v Speaker0>So I think it's this mindset and really, you know, wanting to change something 00:17:57.258 --> 00:18:00.678 <v Speaker0>and really building technology solutions around that. 00:18:01.918 --> 00:18:05.778 <v Speaker0>So that's a very positive thing. You know, obviously, it's all across Europe. 00:18:06.238 --> 00:18:09.978 <v Speaker0>But somehow I have a feeling there's a special touch, you know, 00:18:10.038 --> 00:18:13.898 <v Speaker0>to the Dach market when it comes to this thing. 00:18:15.778 --> 00:18:21.958 <v Speaker0>In terms of scaling climate innovation, and I think we are also going to talk 00:18:21.958 --> 00:18:25.898 <v Speaker0>about that a little bit further down the road. 00:18:29.378 --> 00:18:39.838 <v Speaker0>At the end of the day, it's great to reduce carbon footprint. 00:18:39.838 --> 00:18:43.198 <v Speaker0>It's great to create a circular economy. 00:18:43.898 --> 00:18:48.978 <v Speaker0>It's great, you know, that corporates get, you know, more responsible and take 00:18:48.978 --> 00:18:53.058 <v Speaker0>care, you know, a few things probably they haven't done like 50 years ago. 00:18:53.258 --> 00:18:57.478 <v Speaker0>But at the end of the day, it really is after all its business, 00:18:57.698 --> 00:18:59.398 <v Speaker0>right? It's how to make money. 00:18:59.878 --> 00:19:06.158 <v Speaker0>And I think that's the biggest challenge, you know, and probably even in Germany, 00:19:06.458 --> 00:19:12.858 <v Speaker0>like people tend to think about the solution per se. 00:19:13.418 --> 00:19:19.338 <v Speaker0>Rather than is it really something which is sustainable but not sustainable 00:19:19.338 --> 00:19:24.318 <v Speaker0>in terms of ecology but economy because at the end of the day, 00:19:24.518 --> 00:19:29.398 <v Speaker0>you know, all the solutions have to make money, have to create a return. 00:19:29.798 --> 00:19:34.438 <v Speaker0>Otherwise, it's not sustainable. It's simply a lie to think that you can do 00:19:34.438 --> 00:19:36.858 <v Speaker0>stuff, you know, just for doing stuff. 00:19:37.038 --> 00:19:41.878 <v Speaker0>It needs to be economically viable, and I think that's the biggest challenge. 00:19:42.858 --> 00:19:46.418 <v Speaker1>We talked about challenges here, there's always regulation. 00:19:47.058 --> 00:19:53.738 <v Speaker1>Do you see the regulation currently as an opportunity or as a burden to Greentech founders? 00:19:57.178 --> 00:20:00.478 <v Speaker0>I think that's neutral. That really is neutral. 00:20:00.658 --> 00:20:07.118 <v Speaker0>I think regulation is grossly overrated when it comes to these things. 00:20:07.278 --> 00:20:09.438 <v Speaker0>Obviously, it can initiate thinking. 00:20:10.258 --> 00:20:14.458 <v Speaker0>Maybe there can be a little bit of a wave and create opportunities. 00:20:14.838 --> 00:20:22.818 <v Speaker0>But at the end of the day, I'm a deep believer that people should act freely 00:20:22.818 --> 00:20:26.778 <v Speaker0>and any regulation is an overlay. 00:20:27.178 --> 00:20:34.238 <v Speaker0>And when the overlay really, you know, just creates additional cost and complexity, 00:20:34.238 --> 00:20:35.718 <v Speaker0>that's probably not a good thing. 00:20:35.998 --> 00:20:40.258 <v Speaker0>So I would say it's neutral. 00:20:41.298 --> 00:20:44.978 <v Speaker0>For certain companies, that probably creates opportunities. 00:20:45.698 --> 00:20:49.278 <v Speaker0>But at the end of the day, well, we all know it. 00:20:49.558 --> 00:20:54.238 <v Speaker0>We do have a bureaucracy problem, and that doesn't stop in green tech. 00:20:57.558 --> 00:21:04.638 <v Speaker1>Yes, nicely said. We need the specific mapping. 00:21:04.958 --> 00:21:09.418 <v Speaker1>I was wondering, within the DACH region, when I was thinking this through, 00:21:09.598 --> 00:21:15.258 <v Speaker1>I didn't have a specific hub in mind, something like Berlin, Munich or Zurich. 00:21:15.678 --> 00:21:22.818 <v Speaker1>Do you see any of them or another one seen emerging as a green tech leader in software innovation? 00:21:23.658 --> 00:21:29.278 <v Speaker0>No, no. I think that's a nice thing about Germany. I'm investing in Germany now for 20 years. 00:21:32.318 --> 00:21:35.618 <v Speaker0>Good startups are all over the place. Obviously, there are clusters. 00:21:35.858 --> 00:21:38.758 <v Speaker0>There's a Munich cluster. There's a Berlin cluster. There's a Zurich cluster. 00:21:39.998 --> 00:21:42.658 <v Speaker0>Maybe there's kind of a Cologne cluster as well. 00:21:44.378 --> 00:21:49.678 <v Speaker0>But you can find great companies, even like in small places. 00:21:49.678 --> 00:21:56.998 <v Speaker0>It's pretty, it's pretty, what I put it like this, 00:21:57.238 --> 00:22:01.798 <v Speaker0>having a little bit also in Switzerland at a few conferences where they present 00:22:01.798 --> 00:22:07.998 <v Speaker0>solutions, it seems like Swiss people, they really do a lot when it comes to 00:22:07.998 --> 00:22:09.658 <v Speaker0>hardware related solutions. 00:22:11.627 --> 00:22:17.407 <v Speaker0>Munich is an engineering spot. We all know it, you know, has a great infrastructure, 00:22:18.227 --> 00:22:23.147 <v Speaker0>and a big kind of non-software place are played out in Munich as well. 00:22:23.847 --> 00:22:28.807 <v Speaker0>Berlin, it's clearly software centric. But is there a specific hub? 00:22:29.087 --> 00:22:32.607 <v Speaker0>You know, really never happened. 00:22:32.907 --> 00:22:38.447 <v Speaker0>You know, also when I look at my personal, you know, local investment, 00:22:38.847 --> 00:22:42.967 <v Speaker0>it's completely random. Great teams are all over the place, which, 00:22:43.047 --> 00:22:44.887 <v Speaker0>by the way, is the beauty about the DACH region. 00:22:45.827 --> 00:22:49.347 <v Speaker0>Ask the French. Ask the French. 00:22:50.547 --> 00:22:51.707 <v Speaker0>It's pretty clear. 00:22:52.327 --> 00:22:56.847 <v Speaker1>A lot concentrated in Paris. We'll be back after a short ad break with investment 00:22:56.847 --> 00:22:58.587 <v Speaker1>strategies and portfolio insights. 00:23:03.807 --> 00:23:08.767 <v Speaker1>Hey guys, welcome back to my interview with Wolfgang from High Enough on the 00:23:08.767 --> 00:23:11.727 <v Speaker1>Greentech DACH software mapping. 00:23:12.067 --> 00:23:17.127 <v Speaker1>We get exclusive insights from him and we're now talking about investment strategy 00:23:17.127 --> 00:23:18.667 <v Speaker1>and portfolio insights. 00:23:18.987 --> 00:23:24.307 <v Speaker1>Wolfgang, how does the Greentech mapping inform your deal flow and investment 00:23:24.307 --> 00:23:26.767 <v Speaker1>priorities at High Enough? 00:23:29.847 --> 00:23:34.027 <v Speaker0>Well, that's also a very generic question, which probably isn't 100% on green 00:23:34.027 --> 00:23:36.927 <v Speaker0>tape mapping, but it's basically, it shapes your way of thinking. 00:23:37.587 --> 00:23:43.047 <v Speaker0>It's always different to discuss or kind of to think you've understood something 00:23:43.047 --> 00:23:44.427 <v Speaker0>and to really bring it on paper. 00:23:45.067 --> 00:23:49.327 <v Speaker0>This is by the way, also why like when we do investments, people, 00:23:49.547 --> 00:23:56.927 <v Speaker0>you know, submit investment proposals in written form, like really plain English, 00:23:57.247 --> 00:24:01.527 <v Speaker0>you know, not kind of paste and copy of some PowerPoint slides, 00:24:01.527 --> 00:24:05.947 <v Speaker0>because the very moment you really have to bring down something written, 00:24:06.087 --> 00:24:11.667 <v Speaker0>you have to think, you know, and by the way, best example is that green tech mapping, 00:24:11.907 --> 00:24:15.087 <v Speaker0>which was called climate tech mapping two years ago. 00:24:15.587 --> 00:24:19.047 <v Speaker0>Now, really, we had to think, you know, how the market is evolving, 00:24:19.327 --> 00:24:21.847 <v Speaker0>are there new categories? Do we have new classifications? 00:24:22.767 --> 00:24:29.407 <v Speaker0>So so that it really is it's an exercise which kind of disciplines you and really makes you look, 00:24:29.907 --> 00:24:33.487 <v Speaker0>you know, very carefully in what you're really looking for, what are really 00:24:33.487 --> 00:24:39.447 <v Speaker0>kind of the major trends and what what really makes a difference and of what 00:24:39.447 --> 00:24:41.287 <v Speaker0>possibly could do a difference. 00:24:42.167 --> 00:24:47.287 <v Speaker0>You know, and then obviously it's a great tool because then you have a very 00:24:47.287 --> 00:24:54.567 <v Speaker0>concentrated period in really getting it right, you know, not forgetting everything. 00:24:55.396 --> 00:24:59.536 <v Speaker0>Pieces, you know, trying to have a full coverage, you know, probably, 00:24:59.696 --> 00:25:01.216 <v Speaker0>you know, obviously, you know, on our mapping, 00:25:01.476 --> 00:25:06.516 <v Speaker0>there isn't any, you know, 100% of possible greentech companies in the DACH 00:25:06.516 --> 00:25:11.496 <v Speaker0>region, but at least, you know, it kind of disciplines you what's really important, 00:25:11.636 --> 00:25:14.556 <v Speaker0>what could be potential winners or what are kind of people, 00:25:15.076 --> 00:25:17.036 <v Speaker0>our companies who are really setting trends. 00:25:17.396 --> 00:25:22.476 <v Speaker0>So I think it's very useful, especially when you work in a team and when you 00:25:22.476 --> 00:25:23.656 <v Speaker0>want to start a conversation. 00:25:23.876 --> 00:25:28.736 <v Speaker0>And then when you want to basically discuss business plans and really also, 00:25:28.916 --> 00:25:31.276 <v Speaker0>you know, what kind of direction you should look at. 00:25:32.016 --> 00:25:37.076 <v Speaker0>Yeah, we really like it. And as said, to be very frank, I pointed that out at 00:25:37.076 --> 00:25:39.096 <v Speaker0>the beginning of that podcast. 00:25:39.676 --> 00:25:45.536 <v Speaker0>It's also, you know, making us known a little bit more in the market. 00:25:46.296 --> 00:25:49.516 <v Speaker0>And, you know, just a little bit, a little explanation mark, 00:25:49.516 --> 00:25:51.756 <v Speaker0>hey, we are there and we are interested in this space. 00:25:56.296 --> 00:26:02.396 <v Speaker1>I see. Talk about investments. Can you walk us through the decision to invest 00:26:02.396 --> 00:26:05.796 <v Speaker1>in Trace for Good and how it aligns with your thesis? 00:26:08.156 --> 00:26:13.576 <v Speaker0>That comes a little bit back to what we were discussing previously. 00:26:13.576 --> 00:26:20.676 <v Speaker0>You know, what do you think about horizontal solutions versus verticalized solutions? 00:26:22.136 --> 00:26:27.996 <v Speaker0>We deeply believe that, you know, when you want to do a startup, 00:26:29.461 --> 00:26:32.661 <v Speaker0>Going horizontal is tricky. You know, you don't have the means, 00:26:32.901 --> 00:26:35.341 <v Speaker0>you know, obviously, and then you're competing against the big guys. 00:26:35.621 --> 00:26:39.701 <v Speaker0>So you really have to choose your vertical. But we also believe there will be 00:26:39.701 --> 00:26:41.641 <v Speaker0>always a leader in a specific vertical. 00:26:42.341 --> 00:26:45.121 <v Speaker0>And, you know, we've seen that with Deepkey, we've seen that, 00:26:45.221 --> 00:26:49.841 <v Speaker0>you know, with a few others of our investments, where basically really companies 00:26:49.841 --> 00:26:54.541 <v Speaker0>have chosen a vertical, became very good in it, and then become the market leader. 00:26:55.181 --> 00:27:02.641 <v Speaker0>And in the case of Trace for Good, obviously, you know, just to give a very 00:27:02.641 --> 00:27:07.421 <v Speaker0>brief explanation, what they do, basically, they track the supply chain in the textile industry. 00:27:08.001 --> 00:27:12.021 <v Speaker0>So basically, when you want to buy a T-shirt, you probably want to know, 00:27:12.201 --> 00:27:17.161 <v Speaker0>you know, from the very beginning, you know, what happened, you know, 00:27:17.261 --> 00:27:21.421 <v Speaker0>from the raw materials, you know, where it was done, et cetera, et cetera. 00:27:21.421 --> 00:27:24.941 <v Speaker0>It's a little bit, actually, it is a supply chain issue. 00:27:26.881 --> 00:27:33.661 <v Speaker0>And supply chain is a big issue, you know, obviously, now a little bit watered 00:27:33.661 --> 00:27:37.481 <v Speaker0>down with the latest twists in the US. 00:27:37.721 --> 00:27:41.461 <v Speaker0>But I think at the end of the day, that's a key question to be answered. 00:27:41.741 --> 00:27:48.401 <v Speaker0>And being good, you know, in a very specific niche and a very good vertical, 00:27:48.661 --> 00:27:53.761 <v Speaker0>this is a key thing. And then for us, it's a very early investment. 00:27:54.101 --> 00:28:00.621 <v Speaker0>We thought it's a great team, two young ladies who have a lot of experience in the space. 00:28:01.261 --> 00:28:03.081 <v Speaker0>And obviously, it's a French company. 00:28:04.141 --> 00:28:08.901 <v Speaker0>So textile, fashion, that's probably a French thing as well. 00:28:08.961 --> 00:28:12.101 <v Speaker0>So I think they are also very good positioned when it comes to that. 00:28:14.461 --> 00:28:22.601 <v Speaker1>How do you assess impact and commercial viability simultaneously than when you're 00:28:22.601 --> 00:28:25.261 <v Speaker1>evaluating those green tech software startups? 00:28:25.481 --> 00:28:26.321 <v Speaker0>We don't. 00:28:27.382 --> 00:28:31.582 <v Speaker0>We only evaluate commercial viability. 00:28:32.062 --> 00:28:38.582 <v Speaker0>To be crystal clear, and that's maybe also a misunderstanding, 00:28:38.582 --> 00:28:43.702 <v Speaker0>we don't do impact because we want to do impact. 00:28:44.182 --> 00:28:48.202 <v Speaker0>We think impact is a great way of making money. 00:28:49.022 --> 00:28:55.982 <v Speaker0>And that's what we are for because obviously we manage the funds of our investors 00:28:55.982 --> 00:28:59.502 <v Speaker0>and we really want to make sure that they get a nice return. 00:28:59.862 --> 00:29:02.602 <v Speaker0>We think impact is a trend theme. 00:29:03.022 --> 00:29:07.142 <v Speaker0>I think there are a lot of good opportunities to make money. 00:29:07.422 --> 00:29:11.642 <v Speaker0>But when we look at a company, it really must be ROI driven. 00:29:11.962 --> 00:29:16.342 <v Speaker0>It really must be part of a value chain. 00:29:16.642 --> 00:29:23.962 <v Speaker0>It really must solve a true economic problem and if that economic problem also 00:29:23.962 --> 00:29:27.962 <v Speaker0>solves an impact problem, even better. I just give an example. 00:29:29.982 --> 00:29:39.702 <v Speaker0>I did an investment just a couple of weeks ago in a Germany-based company south 00:29:39.702 --> 00:29:41.462 <v Speaker0>of Frankfurt called Xelera. 00:29:42.282 --> 00:29:46.342 <v Speaker0>With a little bit in a twinkle in an eye, I say they are a Nidvidia competitor. 00:29:46.342 --> 00:29:48.642 <v Speaker0>But actually, they really are. 00:29:49.082 --> 00:29:54.462 <v Speaker0>Basically, what they do, they do kind of a compiler for a chip, for an FPGA chip. 00:29:55.042 --> 00:30:01.622 <v Speaker0>FPGA chips are programmable chips, which help basically to dramatically increase 00:30:01.622 --> 00:30:04.122 <v Speaker0>the capacity of data centers. 00:30:04.122 --> 00:30:10.242 <v Speaker0>So basically, since there's so much traffic now hitting data centers with all 00:30:10.242 --> 00:30:14.222 <v Speaker0>this AI traffic, data centers are desperately looking for solutions, 00:30:14.222 --> 00:30:18.862 <v Speaker0>how to mitigate this traffic, offload traffic, still keep security. 00:30:19.122 --> 00:30:22.862 <v Speaker0>And Xelera is helping data centers doing that. 00:30:23.042 --> 00:30:29.482 <v Speaker0>So it's a really ROI case because basically data center traffic consumption 00:30:29.482 --> 00:30:32.962 <v Speaker0>goes down by 50, 60 percent by using that technology. 00:30:32.962 --> 00:30:39.042 <v Speaker0>But in addition, obviously, you know, when traffic for the same, you know, 00:30:39.582 --> 00:30:44.642 <v Speaker0>traffic hidden in a data center goes down by 50 percent, the CPE usage, 00:30:44.822 --> 00:30:50.102 <v Speaker0>you're suddenly saving 50, 60 percent of energy, you know, in a data center. 00:30:50.142 --> 00:30:52.602 <v Speaker0>So it has a huge impact as well. 00:30:52.862 --> 00:30:56.682 <v Speaker0>So would I call Xolera an impact investment? Probably not. 00:30:57.062 --> 00:31:01.222 <v Speaker0>It's more like a semiconductor investment, but it has a huge impact. 00:31:01.222 --> 00:31:06.622 <v Speaker0>It has a clear ROI case and this is why we also call it an impact investment. 00:31:08.009 --> 00:31:14.669 <v Speaker1>Mm-hmm. I see. For our audience, I would be wondering, what do you think, guys? 00:31:14.829 --> 00:31:17.749 <v Speaker1>Which matters more when investing in greentech? 00:31:17.989 --> 00:31:21.349 <v Speaker1>Measurable CO2 impact or scalable business models? 00:31:21.609 --> 00:31:24.329 <v Speaker1>Let us know how you decide. It's a hot debate. 00:31:26.189 --> 00:31:31.569 <v Speaker1>You are obviously an investor, and I do hope you do have some advice for founders. 00:31:32.489 --> 00:31:37.609 <v Speaker1>What's the mistake you see most often, not necessarily only in greentech founders 00:31:37.609 --> 00:31:45.529 <v Speaker1>but pitches you get and how do you fix them is it that they spray and pray and 00:31:45.529 --> 00:31:51.309 <v Speaker1>send their uh pitch deck everywhere and it it's not necessarily a fit with most of the investors 00:31:52.369 --> 00:32:00.109 <v Speaker0>Okay so just go maybe go first green tech and then a little bit more general 00:32:00.109 --> 00:32:06.609 <v Speaker0>so So, but then, you know, this green tech comment is already a general comment. 00:32:06.989 --> 00:32:16.129 <v Speaker0>Don't think that a product or a solution, you know, is fixing anything. It simply doesn't. 00:32:17.629 --> 00:32:25.529 <v Speaker0>It's also don't think that, you know, that you have developed something which 00:32:25.529 --> 00:32:28.949 <v Speaker0>solves a solution which really doesn't exist. 00:32:28.949 --> 00:32:34.289 <v Speaker0>Because that shockingly often is often the case. 00:32:34.509 --> 00:32:38.089 <v Speaker0>You know, people, you know, basically have kind of this theoretical idea that 00:32:38.089 --> 00:32:42.929 <v Speaker0>something needs to be solved and then they develop a product or kind of a solution 00:32:42.929 --> 00:32:47.969 <v Speaker0>around it and then in reality nobody needs it because it simply is only a theoretical 00:32:47.969 --> 00:32:49.509 <v Speaker0>problem, not a real-life problem. 00:32:49.729 --> 00:32:56.889 <v Speaker0>So I think, you know, obviously the key thing is when it really comes to kind 00:32:56.889 --> 00:33:03.389 <v Speaker0>of starting your startup or really get industry expertise and really try to 00:33:03.389 --> 00:33:07.069 <v Speaker0>solve a problem which exists and which creates ROI, 00:33:07.909 --> 00:33:11.849 <v Speaker0>which really, at least in B2B investing, which really, you know, 00:33:12.609 --> 00:33:18.189 <v Speaker0>as simple as that, you put out a piece of paper, you can go to a customer and 00:33:18.189 --> 00:33:22.029 <v Speaker0>you say, look, when you take my product, when you take my solution, 00:33:22.269 --> 00:33:27.449 <v Speaker0>you can save X in cost or you can get, you know, so much more nimble or you 00:33:27.449 --> 00:33:29.309 <v Speaker0>can gain so much more customers. 00:33:30.609 --> 00:33:32.769 <v Speaker0>And that really requires an 00:33:32.769 --> 00:33:37.869 <v Speaker0>in-depth knowledge of an industry and the workflows within that industry. 00:33:38.049 --> 00:33:43.229 <v Speaker0>And I think that's just my advice, you know, to a green tech founder, 00:33:43.389 --> 00:33:44.989 <v Speaker0>but also to any technology founder. 00:33:45.429 --> 00:33:47.989 <v Speaker0>First of all, try to sort that out. 00:33:49.529 --> 00:33:51.769 <v Speaker0>And then when it comes to pitching, you know. 00:33:53.435 --> 00:33:57.255 <v Speaker0>I think that's a classical thing. You can do spray and pray, 00:33:57.555 --> 00:34:03.815 <v Speaker0>but what are the chances that, you know, you are the one who's picked out of 00:34:03.815 --> 00:34:06.975 <v Speaker0>that inbox, you know, deal flow we are getting every day? 00:34:07.595 --> 00:34:11.455 <v Speaker0>I think carefully think, you know, what could be a good investor for you. 00:34:11.635 --> 00:34:18.555 <v Speaker0>And when you've identified people you think are a good fit, try to find people 00:34:18.555 --> 00:34:23.095 <v Speaker0>who know them and try to get a personal introduction of some sort. 00:34:23.435 --> 00:34:30.795 <v Speaker0>So I think we've never not taken a call with a company when we got a personal 00:34:30.795 --> 00:34:33.575 <v Speaker0>introduction, unless it would be completely out of our scope. 00:34:34.075 --> 00:34:35.895 <v Speaker0>So I think that's a golden rule. 00:34:37.095 --> 00:34:38.255 <v Speaker0>Don't rely on. 00:34:39.895 --> 00:34:43.655 <v Speaker0>Obviously, you have to do your test copy. You really have to be knowledge about the market. 00:34:43.655 --> 00:34:48.895 <v Speaker0>But the next step is really, even in the world of AI, technology, 00:34:49.215 --> 00:34:56.555 <v Speaker0>Zoom and everything, try to get the first personal contact, the first personal touch. 00:34:56.755 --> 00:34:59.135 <v Speaker0>And that takes you very long. 00:35:00.855 --> 00:35:05.215 <v Speaker1>Interestingly, you talked about Celera. Something rang in the back of my mind. 00:35:05.395 --> 00:35:07.475 <v Speaker1>I interviewed them five years ago. 00:35:09.335 --> 00:35:12.375 <v Speaker1>Almost exactly to the day. That's pretty interesting. thing 00:35:12.375 --> 00:35:15.275 <v Speaker1>um you talked about like you mostly 00:35:15.275 --> 00:35:18.155 <v Speaker1>run series a rule of thumb is like a 00:35:18.155 --> 00:35:21.775 <v Speaker1>hundred million revenue um i a 00:35:21.775 --> 00:35:24.955 <v Speaker1>few a few months ago i talked to an investor 00:35:24.955 --> 00:35:27.815 <v Speaker1>and i asked him yeah you're looking for startups like 00:35:27.815 --> 00:35:30.675 <v Speaker1>one million us dollars or one million euros revenue and 00:35:30.675 --> 00:35:37.835 <v Speaker1>he said if i get the chance i always take two euros um so um at this stage they're 00:35:37.835 --> 00:35:43.715 <v Speaker1>getting really serious with their startup what traction metrics or early points 00:35:43.715 --> 00:35:49.935 <v Speaker1>of proof are most persuasive to you when you evaluate such a company okay 00:35:49.935 --> 00:35:54.415 <v Speaker0>Just you know just be clear a series a is not a hundred million it's a million, 00:35:55.255 --> 00:36:02.155 <v Speaker0>one million in revenue and is it a random number yes and no um you know could 00:36:02.155 --> 00:36:05.915 <v Speaker0>it be 800 could it or does it need to be two or three million? 00:36:06.895 --> 00:36:13.395 <v Speaker0>Probably. I think when it, I always, I think venture capital is about, 00:36:15.895 --> 00:36:22.035 <v Speaker0>the willingness of taking four risks. There's a team risk, there's a, 00:36:23.557 --> 00:36:28.517 <v Speaker0>Product risk, there's a market risk, and there's a scaling risk, right? 00:36:29.657 --> 00:36:37.177 <v Speaker0>And as a series A investor, you probably want to take one risk, which is a scaling risk. 00:36:39.057 --> 00:36:44.137 <v Speaker0>And all the other three risks should have been more or less validated. 00:36:44.597 --> 00:36:48.077 <v Speaker0>You know, obviously, the team, you don't know. So obviously there are a few 00:36:48.077 --> 00:36:51.537 <v Speaker0>things where you can, you know, 00:36:52.237 --> 00:36:54.477 <v Speaker0>other than obviously the personal interaction with the team, 00:36:54.577 --> 00:36:56.697 <v Speaker0>which is super important, there 00:36:56.697 --> 00:37:01.777 <v Speaker0>are a few things you can get an idea whether it's a really good team. 00:37:01.957 --> 00:37:06.377 <v Speaker0>For example, it's the simplest stuff, cap tables, like people who are already 00:37:06.377 --> 00:37:12.337 <v Speaker0>70% diluted in a seed investment. They're probably not great guys because they 00:37:12.337 --> 00:37:14.797 <v Speaker0>kind of didn't understand. 00:37:16.737 --> 00:37:21.817 <v Speaker0>A seed round. Um, um, and, and, and then obviously, you know, 00:37:21.897 --> 00:37:26.317 <v Speaker0>when you've spent already 5 million to getting to your first hundred thousand 00:37:26.317 --> 00:37:29.757 <v Speaker0>in, in revenue, that's probably not a stellar performance. 00:37:29.957 --> 00:37:33.317 <v Speaker0>So, you know, you get that, but then the team is very important. 00:37:33.437 --> 00:37:37.697 <v Speaker0>And then obviously a market and product goes a little bit along, 00:37:37.877 --> 00:37:39.917 <v Speaker0>you know, when you have a critical mass of customers, 00:37:40.137 --> 00:37:43.397 <v Speaker0>there probably is a market because people are buying and, you know, 00:37:43.477 --> 00:37:46.637 <v Speaker0>when people are buying and aren't churning, then you probably have a product 00:37:46.637 --> 00:37:49.877 <v Speaker0>because it's working and people seem to be happy. 00:37:50.257 --> 00:37:56.657 <v Speaker0>So, and I think as a Series A investor, you want to have these three things validated. 00:37:56.917 --> 00:38:02.597 <v Speaker0>And that can be like, also depends on the product. 00:38:02.897 --> 00:38:09.777 <v Speaker0>That can be, maybe you have a company who does a product which really instantly 00:38:09.777 --> 00:38:14.837 <v Speaker0>gets like huge contracts and then you have a few couple of big brands. 00:38:15.157 --> 00:38:20.397 <v Speaker0>I'm using that and then it's already a series A and then you have probably a 00:38:20.397 --> 00:38:26.297 <v Speaker0>kind of a more like a small ticket B2B play, you know, which even resembles 00:38:26.297 --> 00:38:28.377 <v Speaker0>to a certain extent to B2C play. 00:38:28.637 --> 00:38:32.637 <v Speaker0>And then you want to have a thousand customers. You want to have like two years 00:38:32.637 --> 00:38:36.157 <v Speaker0>of solid KPIs and you really want to see the growth curve. 00:38:36.357 --> 00:38:42.517 <v Speaker0>So I think it's where kind of you position yourself. And then, 00:38:42.897 --> 00:38:45.937 <v Speaker0>so that's a series A to me, that's a series A. 00:38:46.937 --> 00:38:51.917 <v Speaker0>And when it comes to pre-series A, I think. 00:38:54.796 --> 00:39:02.796 <v Speaker0>You know, out of the three risks, probably one of the risks isn't really sorted out 100%. 00:39:02.796 --> 00:39:07.536 <v Speaker0>So you're willing to say, well, the guys, probably they have a product, 00:39:07.676 --> 00:39:11.856 <v Speaker0>they have a few customers, they've kind of got a good job in product development. 00:39:12.556 --> 00:39:16.936 <v Speaker0>But you clearly sense they really haven't found their go to market yet. 00:39:18.396 --> 00:39:21.356 <v Speaker0>Probably they have to do a little few twists. you know 00:39:21.356 --> 00:39:24.416 <v Speaker0>80 percent seems to be okay but they have still 00:39:24.416 --> 00:39:27.596 <v Speaker0>you know like they need a year or 18 months to 00:39:27.596 --> 00:39:31.416 <v Speaker0>really go very solidly but really then 00:39:31.416 --> 00:39:36.076 <v Speaker0>is use you know kind of makes sense to put in four five six or seven or eight 00:39:36.076 --> 00:39:41.236 <v Speaker0>or ten million and really deploy it for scaling the company i think that's the 00:39:41.236 --> 00:39:42.376 <v Speaker0>difference between kind of 00:39:42.376 --> 00:39:49.936 <v Speaker0>a extremely early pre-series a pre-series a and kind of a solid Series A, 00:39:50.136 --> 00:39:52.996 <v Speaker0>where you really want to deploy money for getting, 00:39:53.256 --> 00:39:58.416 <v Speaker0>by the way, also very important, what's the difference between a Series A and a Series B? 00:39:58.816 --> 00:40:05.036 <v Speaker0>I think a Series A should take you with the money you raise, 00:40:05.236 --> 00:40:12.096 <v Speaker0>you know, from a CEO-led sales model to kind of a broader scalable model. 00:40:12.296 --> 00:40:17.336 <v Speaker0>So basically, it's a transition, you know, from transitioning from a founders-led 00:40:17.336 --> 00:40:23.716 <v Speaker0>team to a team which is mainly driven by the second layer where you have hired a VP sales, 00:40:23.956 --> 00:40:29.016 <v Speaker0>where you're probably hired a VP product, and everything isn't relying on founders anymore. 00:40:30.916 --> 00:40:36.716 <v Speaker1>That's a pretty nice definition. I was also wondering, because the space we're 00:40:36.716 --> 00:40:40.856 <v Speaker1>talking about right now is pretty full of passwords like sustainability. 00:40:41.356 --> 00:40:46.796 <v Speaker1>How can founders there stand out with some substance because i do believe you 00:40:46.796 --> 00:40:50.276 <v Speaker1>do get a hell lot of buzzwords on these uh pitch decks 00:40:50.276 --> 00:40:57.256 <v Speaker0>Yeah and probably it's also that i'm a little bit longer in the market don't care, 00:40:57.876 --> 00:41:05.316 <v Speaker0>as i said our roi counts understand the workflow understand the industry you're working in, 00:41:06.556 --> 00:41:12.276 <v Speaker0>are you really solving a problem are you going to make money um forget about 00:41:12.276 --> 00:41:17.996 <v Speaker0>the buzzwords And by the way, I think sustainable is a great word. It's a great word. 00:41:18.636 --> 00:41:23.516 <v Speaker0>You are sustainable when you're probably going to be around in 10 years from now. 00:41:24.376 --> 00:41:28.136 <v Speaker0>I've never seen a money-losing company being around in 10 years. 00:41:29.176 --> 00:41:32.156 <v Speaker0>Other, I don't know, due. 00:41:33.766 --> 00:41:37.746 <v Speaker1>I have to smile here in the background because before we started, 00:41:37.746 --> 00:41:41.226 <v Speaker1>I told you I'm now in the 11th year here with Startup Radio, 00:41:41.426 --> 00:41:43.046 <v Speaker1>officially sustainable. 00:41:47.906 --> 00:41:52.146 <v Speaker1>Let's talk a little bit about future trends and strategic foresight. 00:41:53.086 --> 00:41:59.766 <v Speaker1>The role of the Dach-based screen tech, what will they play in Europe towards 00:41:59.766 --> 00:42:02.886 <v Speaker1>a broader push for net zero emissions? 00:42:04.186 --> 00:42:11.086 <v Speaker0>I think they will play a 20% to 30% role. The German market in Europe is 20% to 30%. 00:42:12.106 --> 00:42:15.586 <v Speaker0>And, you know, at least when it comes to startups, you have France, 00:42:16.026 --> 00:42:19.906 <v Speaker0>you have a little bit of other areas. So, well, it's probably 30%. 00:42:21.506 --> 00:42:26.366 <v Speaker0>Yeah, I think there will be a few leaders. There will be some groundbreaking 00:42:26.366 --> 00:42:27.886 <v Speaker0>technologies coming up. 00:42:30.386 --> 00:42:34.566 <v Speaker0>But it's a European ecosystem. Even so, we invest pretty nationally, 00:42:34.846 --> 00:42:41.146 <v Speaker0>and I think the contribution will be – it's a percentage game. It's a numbers game. 00:42:42.086 --> 00:42:43.786 <v Speaker0>It will be 20% to 30%. 00:42:44.786 --> 00:42:46.186 <v Speaker0>That's my personal guess. 00:42:46.686 --> 00:42:51.586 <v Speaker1>Personal guess is also totally fine here. I do understand a lot of what VCs 00:42:51.586 --> 00:42:55.806 <v Speaker1>doing is gut feeling, and it's always good when you get a little bit of this 00:42:55.806 --> 00:42:57.506 <v Speaker1>gut feeling here teased out. 00:42:57.506 --> 00:43:04.606 <v Speaker1>Do you foresee the green tech software becoming a default layer across all industries, 00:43:04.866 --> 00:43:09.506 <v Speaker1>similar to something like how cloud computing has evolved? 00:43:09.806 --> 00:43:10.206 <v Speaker0>No. 00:43:10.766 --> 00:43:11.046 <v Speaker1>No? 00:43:11.226 --> 00:43:22.626 <v Speaker0>No, definitely not. Because a default layer means you're really part of the value chain. 00:43:22.626 --> 00:43:28.986 <v Speaker0>And being kind of, 00:43:31.380 --> 00:43:37.560 <v Speaker0>And really becoming part of the production value chain of a specific solution. 00:43:38.140 --> 00:43:47.140 <v Speaker0>So, you know, obviously, will green tech be very important for running businesses? Yes, absolutely. 00:43:47.500 --> 00:43:49.860 <v Speaker0>Yes, because you have reporting requirements. 00:43:50.520 --> 00:43:55.300 <v Speaker0>You know, you basically also want to become more competitive to a certain extent. 00:43:55.300 --> 00:44:00.000 <v Speaker0>It really also probably helps you reducing cost in any sort, 00:44:00.080 --> 00:44:03.540 <v Speaker0>especially when it comes to carbon pricing, et cetera, et cetera. 00:44:03.800 --> 00:44:10.020 <v Speaker0>But being a default layer, so kind of being absolutely required to run a business. 00:44:11.460 --> 00:44:17.060 <v Speaker0>Well, maybe I have too little of an imagination, but for the moment being, no, no. 00:44:17.240 --> 00:44:22.880 <v Speaker0>Everything which I'm seeing, even on that mapping, wouldn't let me that it's 00:44:22.880 --> 00:44:27.200 <v Speaker0>going to be a default player, like a cloud infrastructure, that's not going 00:44:27.200 --> 00:44:30.220 <v Speaker0>to happen. Maybe in five to 10 years. I don't know. 00:44:30.440 --> 00:44:33.840 <v Speaker0>But from what I see now, I'd be skeptical. 00:44:39.900 --> 00:44:46.100 <v Speaker1>The EU is always pretty forward in regulations, taxations. 00:44:46.400 --> 00:44:52.340 <v Speaker1>What impact do you see on this EU-level carbon taxes or green subsidies they 00:44:52.340 --> 00:44:54.880 <v Speaker1>could have on Startup Formation and Funding. 00:44:56.326 --> 00:45:00.166 <v Speaker0>I'll tell you, subsidies, always bad, really bad. 00:45:00.406 --> 00:45:03.206 <v Speaker0>I think there are far too much subsidies already in the market, 00:45:03.246 --> 00:45:05.406 <v Speaker0>which are completely distorting the market. 00:45:05.726 --> 00:45:09.746 <v Speaker0>You know, a lot of stuff is going to subsidize, which doesn't make sense, 00:45:09.866 --> 00:45:12.046 <v Speaker0>which doesn't have a sustainable value proposition. 00:45:13.746 --> 00:45:20.226 <v Speaker0>I really am a big fan in carbon taxes. That's probably the most elegant and 00:45:20.226 --> 00:45:27.646 <v Speaker0>most comprehensive solution, you know, to solve problems. 00:45:28.506 --> 00:45:33.686 <v Speaker0>Because, you know, it really gives a price to something which hasn't had a price. 00:45:33.986 --> 00:45:39.886 <v Speaker0>And the very moment something has a price, you can do marginal trade-offs. 00:45:40.646 --> 00:45:46.006 <v Speaker0>And I think that's a wonderful thing. And, you know, hopefully, will it ever work? 00:45:46.646 --> 00:45:50.786 <v Speaker0>Let's see, over the next 10 years, but at least from a concept, that's brilliant. 00:45:51.886 --> 00:46:04.346 <v Speaker0>Because, you know, the very moment you give, you oblige people to think in margin gains, you know, 00:46:05.046 --> 00:46:07.786 <v Speaker0>technology really, really gets rolling. 00:46:08.866 --> 00:46:13.206 <v Speaker0>First low hanging fruits are fixed and 00:46:13.206 --> 00:46:15.926 <v Speaker0>then you know the more the 00:46:15.926 --> 00:46:18.806 <v Speaker0>price increase you know more tough problems get 00:46:18.806 --> 00:46:24.206 <v Speaker0>solved and and there's and and then also it's kind of to a certain extent you 00:46:24.206 --> 00:46:29.986 <v Speaker0>can plan with it probably you couldn't you can't really plan for the exact price 00:46:29.986 --> 00:46:36.226 <v Speaker0>but you can plan with a long-term trend and that's always a very good thing when you can plan. 00:46:38.966 --> 00:46:47.506 <v Speaker1>That's totally true. Talk about long term, let's talk about your positioning as a VC high enough. 00:46:48.786 --> 00:46:54.886 <v Speaker1>You've raised Fund3 and you have a partnership with Anka Ventures. 00:46:56.236 --> 00:47:03.596 <v Speaker1>How will this amplify your ability to support the green tech innovations in the DACH region? 00:47:05.036 --> 00:47:10.296 <v Speaker0>Just a very brief comment on Anka Ventures. Anka Ventures, we know them very, 00:47:10.416 --> 00:47:12.436 <v Speaker0>very long. Actually, they used to work with us. 00:47:14.196 --> 00:47:19.616 <v Speaker0>Actually, they were part of our team, at least most of them within Anka Ventures. 00:47:19.616 --> 00:47:23.496 <v Speaker0>So it's a little investment boutique who's specialized in impact investing, 00:47:23.496 --> 00:47:26.636 <v Speaker0>but also in seed investments. 00:47:27.356 --> 00:47:29.536 <v Speaker0>And basically, they really help 00:47:29.536 --> 00:47:33.836 <v Speaker0>us to source deals and to even kind of structure deals in the seed phase. 00:47:34.056 --> 00:47:36.256 <v Speaker0>We see them kind of as a feeder. 00:47:36.956 --> 00:47:40.456 <v Speaker0>It's kind of a feeder initiative for us. 00:47:40.676 --> 00:47:46.336 <v Speaker0>About 10% of our fund will deploy in kind of seed opportunities in partnership 00:47:46.336 --> 00:47:49.336 <v Speaker0>with Anka Venture, you know, just to have a foot. 00:47:49.616 --> 00:47:56.076 <v Speaker0>Into great teams and great performing seed startups at a very early stage. 00:47:57.236 --> 00:48:01.016 <v Speaker0>Also, what they bring on the table, like when they found it, 00:48:01.216 --> 00:48:03.156 <v Speaker0>they had this vision early on. 00:48:03.496 --> 00:48:07.116 <v Speaker0>So, and at least in France, but now also starting in Germany, 00:48:07.336 --> 00:48:11.836 <v Speaker0>they do have a name in impact investing, early stage seed impact investment. 00:48:12.096 --> 00:48:14.096 <v Speaker0>They do have quite some knowledge. 00:48:14.476 --> 00:48:17.296 <v Speaker0>And it's always great, you know, to have knowledge in the team. 00:48:19.716 --> 00:48:32.696 <v Speaker1>I see. If you had to bet one under-the-radar green-tap subsector right now, what would it be and why? 00:48:32.976 --> 00:48:36.396 <v Speaker0>It's infrastructure. Nobody really talks about infrastructure. 00:48:37.016 --> 00:48:41.596 <v Speaker0>It's about telecommunication. Well, especially when it comes to software. 00:48:43.116 --> 00:48:55.496 <v Speaker0>I remember like all these ideas when it came to B2C commerce, when it came to B2B, 00:48:55.776 --> 00:48:58.556 <v Speaker0>they always, all these ideas have been out for 30 years. 00:48:58.556 --> 00:49:02.676 <v Speaker0>I remember in the 90s, like being 00:49:02.676 --> 00:49:09.956 <v Speaker0>in the Silicon Valley, we talked about e-commerce, we talked about SaaS. 00:49:10.576 --> 00:49:14.016 <v Speaker0>Obviously, it wouldn't be called like that, but there simply was the underlying 00:49:14.016 --> 00:49:14.996 <v Speaker0>infrastructure missing. 00:49:15.296 --> 00:49:19.956 <v Speaker0>And I think now, especially when it comes to software, when it comes to AI, 00:49:20.356 --> 00:49:24.376 <v Speaker0>but when it also comes to kind of pre-tech solution, which basically requires 00:49:24.376 --> 00:49:26.976 <v Speaker0>the analysis of huge amounts of data. 00:49:27.216 --> 00:49:33.536 <v Speaker0>You need to have the underlying infrastructure and people really, 00:49:33.656 --> 00:49:35.996 <v Speaker0>really need to go into this direction. 00:49:36.136 --> 00:49:42.736 <v Speaker0>This is also a reason why we did our investment in Xelera, where we are looking in other sectors. 00:49:43.056 --> 00:49:46.716 <v Speaker0>I think the sad news one more time is when it comes to infrastructure, 00:49:49.160 --> 00:49:56.060 <v Speaker0>It's mainly a Silicon Valley Israel play, but there are always a few hidden 00:49:56.060 --> 00:49:59.100 <v Speaker0>gems in Europe as well, and we are actively looking. 00:50:00.900 --> 00:50:05.900 <v Speaker1>I see. Wolfgang, thank you very much for your time. 00:50:06.720 --> 00:50:10.500 <v Speaker1>We will link down here in the show notes your LinkedIn profile. 00:50:10.500 --> 00:50:14.520 <v Speaker1>You obviously have a lot of contacts. Before this interview, 00:50:14.680 --> 00:50:21.200 <v Speaker1>I realized that we have more than 120 contacts in common, but it needed an international 00:50:21.200 --> 00:50:24.360 <v Speaker1>PR agency to get us in touch. By the way, they did a good work. 00:50:24.980 --> 00:50:31.800 <v Speaker1>And secondly, we will be providing a link to the company website so you can 00:50:31.800 --> 00:50:33.080 <v Speaker1>do some digging, some research. 00:50:33.280 --> 00:50:37.500 <v Speaker1>And of course, there's a place where you can pitch as well. And you'll be back 00:50:37.500 --> 00:50:42.320 <v Speaker1>for our premium subscribers for a few more Q&As. Thank you very much. 00:50:42.320 --> 00:50:45.720 <v Speaker0>Perfect. Thank you very much. Great interview. 00:50:46.220 --> 00:50:47.140 <v Speaker1>Thank you. 00:50:52.880 --> 00:51:17.178 <v Music>