It has been on the cards ever since Axel Springer sent three senior executives to Silicon Valley – a joint project between Germany’s largest publishing house and the world’s biggest entrepreneurship hub. Specifically, Springer has teamed up with Plug and Play to create a new version of the Valley accelerator in Berlin, and applications for the first program starting in May were opened up last week.
Silicon Allee sat down with Ulrich Schmitz, Axel Springer CTO and its lead in the 50-50 project, to see what the media giant was hoping to gain from its latest move into the startup world.
SILICON ALLEE: Why link up with someone from Silicon Valley rather than launch your own accelerator?
ULI SCHMITZ: We really like partnerships, and when you have a look at our portfolio, you see that in almost every case we have a partner on board. In this particular case we partnered with Plug and Play. Together we can start faster, are more unique and have a broader network than we would have had if one of us had started alone.
SA: Why Plug and Play specifically?
US: Plug and Play has many measures to support startups – they have an accelerator program, they provide office space, and they do early stage investments. And especially when we talk about bringing startups from here to the Valley, we need more than just a pure acceleration program. We need a broader ecosystem and Plug and Play provides that. Plug and Play is very experienced – they have been in the business now for many years. And they are also experienced in expanding their business into other countries. They already have operations in Valencia in Spain, in Singapore, in Moscow and some more in the States and other countries; they recently announced an accelerator in San Diego. But this partnership as a 50-50 joint venture with a strategic partner from the media industry is also new for them.
SA: The research team of Martin Sinner, Kai Diekmann and Peter Würtenberger have been in the Valley for some months now. Is this new project the most positive thing to emerge from that presence?
US: For Axel Springer Plug and Play their [Martin, Kai and Peter] support was very valuable, especially in the beginning. When you bridge such a distance, you can do a lot on the phone but you need this personal contact. They prepared the ground so that we could focus on the operational stuff.
SA: How is the new accelerator going to be different to what Berlin already has to offer?
US: The identity of the partners behind it really makes a difference. We are a media company, with a specific track record, and then you have Plug and Play, with their track record and their network. Regarding the program, we focus a lot on the coaching of the teams. We haven’t positioned Axel Springer Plug and Play against other market players, we have positioned it into the Berlin ecosystem as an additional offering, and I think the startups will know why they should join a specific program. That might be differentiated by the business, by the network, and I would encourage every startup to take a close look and talk with the people involved before deciding which program to join.
SA: Does Plug and Play give Axel Springer a better sense of legitimacy in the startup scene?
US: We are already part of the startup ecosystem. We learned a lot from our Media Entrepreneurs initiative. We had so much positive contact with startups, and I think we could have started the accelerator also under the umbrella of Axel Springer alone. But what we can offer with two partners is more reliable because of our track records.
SA: What kind of company are you looking to attract? How many deals are you planning to make?
US: The closer something is to media, the better. It’s not just the pure content business but business somewhat related to media or even growing faster by usage of media. I’m not being very precise here, but I would like to give this anchor, media, and another anchor is technology. There should be technology behind it, and we are really looking for startups with people who understand their business and technology; we think that that’s really important. When you join our program and the first thing you do is to ask for a tech guy to help you build the technology behind your product, then it is to early to join this accelerator. You should have a team with an amalgam of the product side and the technology side.
Hopefully we will get many applications, and we would like to start here with up to ten teams. Then after the first term we want to start with another ten, and then decide how we maybe expand it.
SA: Do you already have a location in mind?
US: We already have a location that is very central and near the Axel Springer building. It will be an open space that supports a working atmosphere.