00:12:57 · Andre Degler
[00:12:57] S0: Yeah. Yeah. Yeah. Yeah. Go ahead.
00:12:59 · Uwe Horstmann
[00:12:59] S1: Mean, one of one of the one of the beautiful things about startups is that they are inherently more democratic than a lot of old established companies. I think, you know, it's best practice that startups really share ownership among employees even wider than they used to do. It's not something that is... That has a big tradition in Germany so far, but I'm hoping that it changes. But it also means, of course, that we are careful around how we treat those stock options, so those elements of ownership in those companies for employees. And one risk that we see from time to time is that there will be tax on dry income, for example, in Germany. Right? So that could be problematic. Now there's another question on how should they be taxed? Should they be taxed as capital income and should they be taxed... Or should they be taxed as a salary? Hopefully, listeners haven't fallen asleep by now, but that is a different discussion. I think the big problem is, you know, should they be taxed before there's actual money flowing? And that should not be the case. We can have a discussion about whether there are capital That's a different question. But dry income, so you have to pay tax on something that is theoretically worth something, but you haven't seen any money yet, that will be a problem. Because that could be a factor that kind of slows down that positive effect, the positive self reinforcing growth of the ecosystem, because you're taking out one important aspect, which is that capital not only flows back to large investors but also to very small investors, and those people can turn into business angels, and that is what drives progress of the ecosystem, because business angels can become experts for new industries. They can become experts for underrepresented groups of entrepreneurs and so on. So I think we need those business angels, and so we need to make sure that the leading contributors in companies also are able to benefit from the economic growth that is being created because we know that they're channeling it back into the ecosystem. And that way, the pie gets larger for everyone.
00:15:05 · Andre Degler, Uwe Horstmann
[00:15:05] S0: No. Yeah. That that that is true. And just to finish off with this question, when you talk about explosion, how do you actually envision it? Do you envision it as more startups being launched or more funding being raised or more exits being, well, publicized, announced? [00:15:23] S1: I think all of that. So I think all of the combination, because that that just defines the attractiveness of an ecosystem. And then I think the core is that we see more good talent also tackling new tough challenges. Yes, capital is important. Yes, exits are important. But the best thing that we can... That can happen, of course, is new smart minds saying, I want to do something entrepreneurial. And either if I'm a founder or a contributor, it doesn't even matter that much in the beginning, but I want to get into that ecosystem. As opposed to taking the easy route in a large established company, I wanna do something entrepreneurial. That's that's the core, I think, that's driving all of this. [00:16:02] S0: Alright. Right. I understand. K. So, usually, it's a it's a popular question, I think, when talking to VCs, but I still wanted to ask. What about your portfolio and anti portfolio? So, like, the best investment decisions, the worst investment decisions over the ten years?
00:16:18 · Uwe Horstmann
[00:16:18] S1: We are fortunate to have had, like, a couple of real big successes in the portfolio that are already very prominent. Trade Republic is one, which just announced this this massive round. We are investors in Crew, in Sender, in Casavo, in Spryker Systems, so a bunch of really big successful companies. And, you know, that is... When I'm always asked this question about your portfolio, anti portfolio, I always want to make sure that I avoid the impression of I am this investor, I'm laid back in my armchair, and there is a company coming by, you know, the future... Let's say, sender or somebody, and we are just like a Roman imperator saying, Hey, you guys are pretty smart. Here's some money, and then that is my investment decision. The reality is very different. We need to beg those people to take our money, right? So we need to be thankful that we are allowed to call them members of our portfolio. It's not the other way around. Like, if you watch too much Shark Tank or Höhle der Löwen or however you want to call it, a different impression might arise that the startups come begging, and then we are so nice to them by giving them money. That's not the case. We need to really work hard to convince them to take our money. And when I talk about portfolio and other portfolio, it's important for me that people understand this. So those are companies where we are very lucky to have unfortunate lucky is maybe a bad word because it implies a lot of luck, but let's say where the situation was so great that we came to the conviction that this is a great business to invest in, and also we had that we got the chance to invest. So those two things need to come together to build a portfolio. Now in anti portfolio, there's companies that we passed on, and they went on to become really, really successful. You know, we can talk about a few examples, but again, also the same here applies not only because we said, Hey, let's not invest. It doesn't mean we would have been able to invest if we had decided differently, right? So it's a long way from us saying, Hey, we want to invest, all the way to, Yes, we actually get the investment done. And TechsFix, for example, is such a example, a fantastic company that we wanted to take... That we looked at, you know, really closely.
00:18:35 · Uwe Horstmann, Andre Degler
Ultimately, we didn't do it, and, you know, I wish those guys obviously the best of luck, and they have proven us wrong already. Not to say that we would have been able to invest again, but they are doing a fantastic job, we would love, of course, to put some money in now in hindsight. Or another example is Sorare. We really tried get that deal done. Unfortunately, couldn't get there, but yeah, in hindsight, of course, that would have been fantastic. Also, you know, a great team, awesome set of investors, such a great success story so far for everyone involved. So we are very happy that this works out. Obviously, we would be a bit happier if we would be part of it, but that's the way that that game goes sometimes. [00:19:18] S0: Generally speaking, does the whole crypto industry and NFTs, does it fit into your thesis? [00:19:25] S1: We are... So we haven't traditionally done a lot there, to be honest. We are looking at it always a bit from the outside, and we are regularly checking, basically, if we should get more involved. And it seems like there's a new wave happening, and we are at the moment evaluating how should we get involved. So, you know, if people listen to this and they really think we should, we'd be very interested in having that discussion even though we haven't done a lot in the past just yet. It is something that is obviously high on our agenda that we wanna reevaluate on an ongoing basis, and right now is one of those reevaluation points. [00:20:01] S0: I'm still very skeptical, but then I'm not a VC. So... I mean, that's why.
00:20:01 · Andre Degler, Uwe Horstmann
[00:20:01] S0: I'm still very skeptical, but then I'm not a VC. So... I mean, that's why. [00:20:07] S1: Lots to like, lots to dislike. Right? So definitely, it's about it's about the right model. I mean, the new fancy coin, you know, two years ago, that probably wouldn't have been our right business. When it comes to enabling infrastructure, probably a bit more so. So let's see. [00:20:21] S0: Yeah. Yeah. And, so you mentioned already that, you have quite a few people, working, for Project A, and, like, much more people than you would normally expect, from a VC firm of your size, and most of them operators available for your startups if they want them. So... How does it actually feel and how it works when you scale a VC firm pretty much the same way as you would scale a startup? So how was it for you?