Posts Tagged ‘start-ups’

Why Startups don’t make it past the 5-year mark

Tuesday, August 10th, 2010

The German Federal Ministry of Economics and Technology requested the Centre for European Economic Research (ZEW) to carry out a study on why young companies fail within the first five years of their existence.

The study looked at 3000 companies that closed down between 2006 and 2009. Almost three quarter of these companies at some stage were making a profit, which goes to show, that the study did not only analyze companies without a marketable business model.

The study found out that the main reason why startups do not make it, is that there was insufficient seed capital. Further reasons can be found in unexpected market changes and strategic miscalculations. Thus, companies should make sure they have enough money to sustain their startup and they should be flexible so they can adapt to any market changes.

The Full Study can be found here (only in German): http://bit.ly/9pC6qR

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Posted in Venture Capital, entrepreneurship, start-ups | No Comments »

4 Important Factors when Raising Funds

Thursday, July 8th, 2010
  1. Market. This is possibly the most important factor to consider: is there market demand for your product? If there isn’t you will have a chance even with a mediocre product, however, if there is already a strong market, even an extraordinary product might not do the trick.
  2. Momentum. You have to continuously show that you are working on your product. You need to have people using your product, not just once, but also coming and a good marketing strategy. This will indicate that you have some traction in the market.
  3. Team. You need to have a reliable team around you. Only hire people you know and that will stand behind your product and work on it with 100% effort.
  4. Naysayers. If people are saying what you are attempting can’t be done, that is a good sign. It means that they don’t know how to do it and as a result you know you have discovered something new.

For a more detailed account please see http://bit.ly/d99jDF

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Posted in Venture Capital, entrepreneurship, innovation | 1 Comment »

Hard Times for German High-Tech Startups

Friday, June 18th, 2010

The Economic Crisis has led to a decrease of investment in high-tech startups by 70 percent in 2009. The most hard-hit from this have been the high-tech industries, which mainly need money in the seed phase to get off the ground. In 2009, only 8 million Euros were invested in seed funding, which is detrimental, as especially high-tech startups need a lot of money at the beginning.

The Problem is that investors want security that seed funding generally does not offer; most of the time it means high risk and low cost-efficiency. In Germany the selection of high-tech startups is limited, which leads investors to invest internationally rather than locally. Currently there are too few people risking to become self-employed, which is in part due to the lack of seed-stage investments.

The mentality in Germany has to be changed in order to get the startup motor running again. Financing should already occur in the research phase, which will increase the likelihood of people creating startups, as this idea is being encouraged very early on. With private investors not willing to invest in the seed phase, public investors have to step up and help the high-tech market get back on its feet.

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Ninth Heidelberg Innovation Forum on the 22nd of April, 2010: Cleantech and Green IT

Friday, April 9th, 2010

26 Cleantech and Green IT companies present their business ideas at the Heidelberger Innovation Forum on the 22nd of April, 2010.

The Keynote speakers this year are Wolfgang Seibold, partner at Early Bird Ventures, and entrepreneur, investor and founder of Beyond A Strategy Inc., Mona Pearl.

Since 2005, the Heidelberg Forum has helped early-stage companies find suitable investment opportunities, with great success: during the past events 250 entrepreneurs from 10 different countries presented their innovative ideas and more than half of them established valuable contacts to important investors in their respective sectors.

The conference will take place at the Studio of the Villa Bosch and the evening reception will be at the Palais Prince Carl in the old city of Heidelberg. During the evening reception, the best business idea will receive an award.

Please see the following link for any further information: http://heidelberger-innovationsforum.de/index.php?id=139&L=3

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Posted in clean technology | No Comments »

EVM @ Innovact, the European forum for innovation

Friday, March 5th, 2010

This week, on the 2nd and 3rd of March, about a thousand innovation enthusiasts gathered in the sparkling city of champagne, Reims (France) to attend Innovact, a European forum for young and innovative enterprises organised by the Chamber of Commerce and Industry of Reims and Épernay.

A delegation of the Continua team travelled to France and saw innovation in all its aspects: young enterprises, incubators, universities, delegations, (governmental) associations, research organisations, consultancies and investment firms coming from 20 European countries. During the two forum days, we all have intensively networked, discussed products, projects, problems and solutions, took part in workshops on innovation, technologies and entrepreneurship and listened to keynote speeches on strategies and other industry-specific issues.

As the Innovact forum and the European Venture Market are striving for the same goals, namely to promote European innovation and entrepreneurship and to improve communication and networking between entrepreneurs and investors, we have engaged in a long-lasting partnership. With both the Innovact forum and the EVM, we are eager to create new business opportunities, while aiming for a more competitive and dynamic economy in Europe!

We have met a great deal of fellow innovation addicts and look forward to being in touch with them in the future. Innovact team: merci beaucoup for organising this outstanding event!

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Looking back: Venture Capital in 2009

Monday, February 15th, 2010

At the end of January, PricewaterhouseCoopers and the National Venture Capital Association have released a report in which they examined the state of venture capital for technology start-ups in 2009. According to their research, venture capital has known a sharp decline last year, investing the lowest amount since 1997: $17.7 billion in 2,795 start-ups (a downfall of 37 percent compared to 2008). Especially, internet companies and clean technology enterprises took a hit, as investment in their sectors dropped respectively 39 and 52 percent.

Even though the slowdown caused serious trouble for technology companies in need of money, several investors claimed that this development functions as a much-needed and healthy check-up of the venture capital business. Roger McNamee, co-founder of Elevation Partners, believes the industry needs to reinvent itself. Jeff Fagnan, a partner at the investment firm Atlas Venture, could not agree more: “It would be healthier if we can return to the pace and kind of deals that were done in the 1990s.” Venture capital should be backing more first-time entrepreneurs and ideas coming out of universities, he adds.

And there is hope: investments in technology companies have slightly increased in the final quarter of the year, due to the recovering global economy. However, although entrepreneurs can hope for an improvement in 2010, the 2009 slowdown in investing is expected to continue this year.

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Posted in Venture Capital | 4 Comments »