The last three days we have participated in Bits and Pretzels conference in Munich. We have to say: we enjoyed it a lot. Here is our pretzels’ digest upon the bits of inspiration we were able snap. So „1, 2, g’suffa!“
Arriving, admittedly a bit late – closed frontiers between Austria and Germany are not so much practicable for an open EU mindset these days – we entered the halls of Messe Munich West. After a warm welcome we immediately bumped into loads of bits and pretzels – a true pretzels mania for your mind and stomach. (Being originally from Salzburg – I am an absolute fan of those „Laugen Pretzels“...)
Taking a glimpse at the screen in front of the great hall we spotted a fellow Austrian – Florian Gschwandtner, founder of recently acquired company Runtastic. Having announced a €200 million exit at the beginning of August, Florian shared his entrepreneurial journey. Amongst such the most memorable quote was that “A baby shark is still a f*ing shark!”. Florian encouraged fellow start-ups to instinctively follow their idea and consequently execute it, even if it might seem strange to friends, family and fools. Once successful most will eventually forget that it was exactly this “wild” decision that brought incredible value to the start-up world.
Adidas CEO Herbert Hainer and Prof. Herbert Henzler offered their insights in the recent acquisition of runner’s app Runtastic. What stuck out was that Herbert Hainer stressed that Runtastic is meant to enrich the traditional German company. The start-up is not meant to be indoctrinated by corporate processes and mind-sets. Maybe the other way round?
What is your primal voice?
After witnessing a ground drone presented by Limor Schweitzer of @robosaavy and listening to a money money money pitch of Morten Lund and Markus Stefanko, we enjoyed the pretzels’ atmosphere with a clown. Yes! A clown at a start-up festival. Little did we know - the speech was impressive. David Shiner told a story - his story - of performing as a street artist and ultimately joining forces with a team and ending up in Broadway at what happens to be known as Cirque du Soleil. As basic the questions posed by the clown might have been, the presentation of body language and finding your comfort spot of speaking was thrilling. “What is your primal voice? What is truly important to you?” What is your story? From agony and ecstasy. This question will remain with us for a while.
Then a fellow conference participant was chosen by David Shiner to embrace the moment of improvised theatre and you could watch a stranger first excited, then more and more relaxed being supported by the audience. (Btw: It was great to see how body tension and breathing is truly influencing your speech, your presentation and the timbre of your voice…)
There is a special place in hell
Colette Ballou (founder of Ballou PR and panel host), Steffi Czerny (Managing Director of DLD Conference), Gabi Zedlmayer (VP at HP) and Anna Alex (Founder of Outfittery) shared their view on digiconomy and diversity. Having witnessed the controversial discussion on female panels with questions whether all children are by the same father at the Salesforce’s Dreamforce Conference (it is definitely worth a read by Lauren Hockenson, TNW: Dreamforce’s Women’s Innovation panel is why we should stop babying female CEOs Colette Ballou emphasised how important it is to share real insights and meaningful questions. The essence? All women shared the opinion that cooperation is still to be improved in professional environments, no matter whether we speak about women or men. “There is a special place in hell for all women who do not help each other!” Steffi Czerny stressed that young entrepreneurs have to become their own role model and embrace the tremendous chance of uncertainty. So stop waiting, make and do!
Let the bonfires burn
Ben Parr, author of Captivology, educated us in the matter of getting attention and how to break through the noise nowadays. According to Ben attention happens in three stages: immediate, short and long attention. As a start-up you need to take care of all those three. “Attention is like a bonfire (…) you have to start with triggers!” Those triggers will lead to interest which then further on can be fostered, curated and taken care of. So find out what is your dopamine driver and do not forget that all customers foremost would like to trust you. (Fyi: Dopamine heavily influences awareness, attention and consequently memory. So we better get it – somewhere.) How? Apply the credibility rule: Find someone who validates you and makes a proper introduction whenever you seriously would like to take care of sensitive matters. As a start-up you should never be too poor to pay attention. So let’s get this bonfire started!
An army of tech minions
After a unicorny moment (angel investor Gil Penchina presented the German Unicorn Syndicate) Lars Jankowfsky talked about the importance of understanding your tech people – in his case, his minions. Being a GP at NFQ.com he witnesses too many times that start-ups request a quick hack for a prototype. Without the proper awareness of the path dependency this decision might have that turns out to be a straight lock in with an expensive agency contract. Closed and keys thrown away. So honestly: don’t! His advice: Refactor your code and take care of aging lines, be agile, trust your people and foremost apply the triple T rule: THINK THEN TALK. Your developers will cherish your trustworthy relation if you at least do not jump around like a crazy bunny on a daily basis. A time horizon of 2 weeks makes every tech person already happy. Personal note of Jankowsfsky to all CEOs and sales people: Culture matters more than money! Properly take care of your techies, learn to understand them and buy them shitloads of monitors (2 AT LEAST!). As for last: take a bite of your #pretzels and start coding your #bits.
The first day was closed by social entrepreneur Joe Green. In 2007, Joe Green co-founded Causes with Sean Parker – best known for his involvement in the early days of Facebook aka Facemash. It was an inspirational talk on the future of societies and what happens if you no longer define individuals by their prime source of financial means: work. According to Green, religion will see a resurrection, our energy problems will be eventually solved and technology will provide the basis of living for everyone. What we really should be afraid of? Virtual reality. Seriously, why would you move one tiny inch out of your home...?
After a refreshing coffee of King Koffein (daaaang we would love to have those guys around the corner) we hit the main stage. It was a great kick-off – literally. Stefan Mennerich, Director Media Right, New Media and IT at FC Bayern Munich, offered insights behind the social media playgrounds of the Bavarian football club. That was refreshing! We loved a concise, practical and crafty presentation on what it takes to manage the virtual identity of FC Bayern Munich. And FC Bayern is scoring big time, not only on the pitch: Sefan Mennerich and his team enjoy an audience of 48 million follower and Bernie the mascot is number one world wide (also in the US!). Yet, all those fans like to be entertained properly. For China, for example, FC Bayern produces one video per day showcasing the football club. With all those efforts their fan base is steadily growing. What all marketers and content producers witness right now is the same for the football club: Content shared by their players is increasingly important to attract followers and fans. Just producing content is not enough. It is about showing who you are. And it seems this effort is paying off: 60% of all merchandise revenue is generated online. Score!
Pieter van der Does, CEO and Co-Founder of Adyen, and Niklas Östberg, CEO and Co-Founder of Delivery Hero were next. That talk was entertaining. Both emphasised, like many other conference participants during these days, the importance of hiring the right people and firing people that destroy your good vibe. Our quote on Pieter “We have a zero dick policy – you cannot work for us if you are a dick even if you are good!” was retweeted several times making it our most successful quote of #bits2015. Fair enough if we assume a lot of people could not agree more.
Staying ahead of competition means to reinvent each and every day. Adyen CEO Pieter advises fellow unicorns in spe to stick to the plan but making modifications as they go, hiring wisely and firing fast. We are glad he has not yet retired to Rio and shared his story. Germany’s Delivery Hero Niklas Östberg suggests you to learn coding instead of cooking because he will make sure that your kitchen will soon be gone. Congrats to both of them. They are true European success stories and benchmarks for us start-ups.
Great news: VCs won’t die. For now.
For the separate track we have chosen the investor’s track to listen to the panel discussions on the state of venture capital and crowd funding, with Sean Seton-Rogers, Partner at Pro Founders, hosting the panel. His questions were punchy (although some diplomatic answers still could slip by). The conclusion? Go Asia, apply the Nordic winning strategy of welding engineering and design, and before getting a VC on board call 3 CEOs and founders that work together with this particular VC. Primary requirement is that your investor will understand your business and can eventually help you scale. Whatever business you are in, get a proper introduction by someone who validates you (yes we have heard this before by Ben Parr) and remember: smart money is better than no money.
The closing panel quickly reached consensus that VCs will always focus on outperformers and traces of unicorn DNA, however, crowdfunding will and already does serve well for entrepreneurs that otherwise would not get VC backup. Jeff Lynn, CEO of Seedrs, provided a sample case of the ice cream manufacturing. Seriously, who can say no to ice cream? However, VCs sometimes might prove to be too calorie-conscious though. So here comes the good news: VCs won’t die. For now. Nevertheless, crowdfunding within investor fields to find true outperformers will eventually lead so some casualties on the VCs end. A crowdfunding campaign however might prove to be a great sales channel you should consider. Just ask your fellow friends - your crowd so to say.
Founder of Friendsurance Janis Meyer-Plath presented his insuring fintech start-up. As we discovered, insurance is the new fintech. By introducing a P2P layer in the whole insurance process Janis and his team achieve a considerable cost reduction by cutting out the middle man. Up to 40% premium is supposed to be paid back to the customers. You still need to buckle your seat belt though. Similar to banking “The willingness to change is there!”.
According to Ramin Niroumad, CEO of FinLeap, fintech will make the worries of an old man worse. Banks still lack behind to openly embrace digitalisation, facing heavy regulation at the same time. Sticking to old legacy systems, banks miss out on the #fintech momentum. Admittedly, we all concluded that this was first class bank bashing, however, Ramin argues that both – start-ups and banks – do lack some resources that the other party possesses. Collaboration is essential and fertile.
Up next the fintech track was GoCardless, SavingGlobal and Accel. GoCardless CEO Hiroki Takeuchi observes that ordinary users are no longer scared to use alternative services. Takeuchi did not start out as fintech: “We were a start-up solving customer problems which happened to be in the finance space.” He perceives #fintech being far more a technical and engineering challenge than a finance related one. (Agreed and check.) According to Accel it does not really matter whether there is a fintech bubble or not since for them the bet is always the same. “It is an individual bet on a individual start-up team.” According to SavingGlobal CEO Tamaz Georgaze “Regulators are waiting around the corner to prepare for the fintech bubble to burst!”. The more serious concern, however, will be fintech start-ups getting out of service because investors are no longer putting money at the table. Definitely, this will impact customers’ perception. Nevertheless, banking, is prone to change. Undeniably.
Without further ado
Multiple 90seconds and a smashed guitar later, the winning start-up was nominated for the 500 Startups Pitch. We congratulate the winner JCParts! Loic Le Meur (LeWeb) and Phil Libin (Evernote) conspired that the essence of investing is to find things that suck and consequently finding awesome people who make those suck less! Investing explained in one sentence. It is that simple J.
Bits and Pretzels final remark
Bits and Pretzels was a great opportunity to connect, get inspired and take a little break out of everyday start-up hustling (and of course to eat one or two (I admit it, I ate 3) pretzels. The whole Oktoberfest style was meticulously followed through and taken care off - for non-Bavarians great to watch. Strangely every CEO, start-up and corporate participant in those Lederhosen and Dirndls look quite hilarious/different than our eyes are used to. Tech people – how could it be - still combined their geeky shirts with Lederhosen. The talks were inspiring and also the composition of themes was great for starters. Especially newcomers and startuppers that are not yet familiar with all the particularities of trying to set your own path and feeding the next unicorn should have taken out loads of inspiration of Bits and Pretzels.
For corporates and investors, we received the feedback, there could have been more opportunities to network. Naturally, one could argue that getting to know new people is not dependent on the formal frame (and might also happen at the social events), however, we did not really see the advantage of using the networking app. Small detail on the side is that we were seeking the programme in our emails but none was found in advance (open Wifis at some hotels and in Germany are still rare). For startup pros we would have liked to see a bit more tougher panels and content. Especially the investor side has been utterly diplomatic using loads of generalisations and flowers for a topic that can get ugly at times. We would argue that adding 10 minutes here and there would have allowed people to dive deeper. Especially 4 people panels did not have the time to reach deeper practical, conclusive and professional relevance. This minor error was definitely taken care of at the networking table the next day where we had an enlightening discussion on diversity and how to find developers out there with Maren Heltsche, founder of speakerinnen.org. For the next time we just have to take warmer clothes – cold beer at 9 in combination with Munich late September – not a good idea.
Considering what we have seen we would like to offer following feedback – and yes it is highly biased, skewed and god knows what:
Organisation: 10/10 – Dang you guys at the entrance have been fast! Like Flash!
Inspiration: 9/10 – Combining unicorns, pitches and a clown – nice.
Networking: 6/10 – We have met great people there – give us more!
Start-up Experience: 6/10 – We want more start-ups showcased!
Social Events: 8/10 – 1, 2, ….
KnowHow Transfer: 7/10 – Already great topics – we want to dive deep!
We hope you had a great time there as well and if you have not met Team Holvi make sure you do next time! (Rumour has it we are going to Slush – YAY!)
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