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This Month in German Startups — October 2020

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This Month in German Startups — October 2020


Welcome to This Month in German Startups by Startuprad.io — in a transatlantic news recording with Chris in New York City.

Today we are wrapping up October 2020 for you with a monster round in the making at N26, new information on the Wirecard insolvency, and questions about published information of Heidelberg-based insurance startup Getsafe.

Thank you!


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This recording was made possible by (Hessen Trade and Invest). Learn more about our enabler here: https://www.invest-in-hessen.com/

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Housekeeping — Time to brag

We have only one thing to say: Stay safe everybody!


The Video Podcast will go live on October 30th, 2020



Audio Podcast


Top News


Monster Fundraising of N26 on the Horizon

N26 Weighs 2021 Fundraising Above $3.5 Billion Value https://buff.ly/2H5415k

Bloomberg reports:

N26 GmbH is considering a fresh fundraising round next year, people familiar with the matter said, as the German mobile bank eyes a valuation above $3.5 billion.

… The funding round could be the company’s final one before it considers an initial public offering as early as 2022, one of the people said.


Monster Deal with Uber on the Horizon

Uber offers more than €1 billion to buy Daimler/BMW’s mobility service Free Now: Manager Magazin https://buff.ly/2HfRGvT

  • German carmakers have held early-stage talks about deal

  • Daimler valued its half of Your Now at $720 million as of June

  • Uber expressed interest in a potential acquisition of Free Now after the venture’s efforts to attract additional investors struggled to gain traction amid the coronavirus pandemic, …

Related:

German media reports BMW and Daimler lost patience with their joint venture Now Group, combining some of the digital offerings of both German car titans, including #carsharing, taxis, and rental cars https://buff.ly/3iuLlcf


Some Unicorns are suffering from Corona

German travel startup Getyourguide lets go of a sixth of staff https://buff.ly/3k3NBsz The startup is a unicorn since its latest funding round in May 2019. The Berlin-based unicorn raised more than 650 mn US$ from 24 investors


Some companies are profiting from Corona

Hellofresh increases projected revenue for 2020 for the 4th time. Now the revenue forecast is almost double the 2019 revenue. The company forecasts between 3.5 and 3.7 bn Euros https://buff.ly/3dDfs0x


Auto1 IPO — More signs

Founder of #Berlin-based unicorn Auto1, Hakan Koç gives up CEO post, shifts into supervisory board ahead of a much-expected IPO https://buff.ly/3jFw9KU


Wirecard

We keep you updated, just a small selection of news here

  • Insolvency administrator of Wiredard announced the sale of the unit Wirecard Retail Services to Unzer (formerly Heidelpay) https://buff.ly/35jtcKb

  • EY Faces Backlash Over Wirecard Whistleblower | PYMNTS https://buff.ly/3n3cJ4R

  • “it came to light that an EY auditor alleged the global accounting firm was warned as far back as 2016 that senior managers at the German payments company may have committed fraud and one had tried to bribe an auditor.”

  • According to German media reports: Wirecard’s liquidator accuses former management of hiding money systematically before the insolvency “accounts have been stripped” https://buff.ly/31Kw4hY According to Handelsblatt the main suspect could be Jan Marsalek (see our blogpost about him here: https://www.startuprad.io/blog/blogpost-jan-marsalek-former-wirecard-coo-one-of-the-most-hunted-for-persons-on-earth/), who is fleeing since he lost his job as COO of Wirecard.

  • IMS Capital was one of the investors of Wirecard, who had to file for insolvency. Now IMS’s investment, the online supermarket, GetNow has to file for insolvency as well, likely as a consequence of IMS’s insolvency https://buff.ly/3oph5UF

Ecosystem

  1. Amazon.de 10.5 billion euros

  2. Otto 3.4 billion euros

  3. Zalando 1.6 billion euros

  4. Media Markt 1.2 billion euros

  5. Notebooksbilliger 0.9 billion

  • 500 German startups received 1,4 bn Euros in government corona aid, according to government-backed KfW (which administers the money) https://buff.ly/34Powvm

  • Private Equity in Germany: Only 16% dip in total, Venture Capital shows a slight upward trend, according to the German PE and VC association BVKAP https://buff.ly/313K4Dn

  • Related European 2020 data:

  • VC investment in Europe down 12% in 2020 | Sifted https://buff.ly/350q1qD

  • Related European 2020 Q3 data:

  • European Venture Picks Up In Q3 Following Slow Start https://buff.ly/35eWEAR

Hubs

Note: The order of news and cities is only due to the time when we discovered the news, rather than anything else.

Frankfurt

FYRST is live

Deutsche Bank’s in-house #neobank for freelancers and entrepreneurs, called FYRST made a soft launch already https://buff.ly/3ndOZLr no numbers have been communicated so far

Frankfurt welcomes Coinbase

Frankfurt will be the German HQ of Coinbase. They also hired a former manager of Deutsche Börse to run their operations. The position as chief compliance officer is still open https://buff.ly/3iRPebG

Female Founders

First bach of Accelerator Frankfurt’s female founders program starts: Accelerator Frankfurt open workshops (Frankfurt am Main, Deutschland) https://buff.ly/35iHqLh

Fundraising

CAPTIQ, the #Frankfurt based lending fintech, raises “seven-digit” #VentureCapital round, with many existing investors adding to their investment https://buff.ly/36DOHrg

Heidelberg

There have been many reports on Heidelberg based insurance broker / insurtech GetSafe. They are raising a venture capital round, which could top out at 50 mn Euros. This would be one of the largest financing rounds in Germany for an insurtech ever. Now the blog FinanceFWD publishes some allegations:

  • FinanceFWD reports Heidelberg-based GetSafe has inflated numbers and used AI as Buzzword only https://buff.ly/3jtpHFS

  • A lot of noise about nothing — titles t3n, another well-regarded tech blog — their article on GetSafe as a reaction on the article above https://t3n.de/news/viel-laerm-um-nichts-vorwuerfen-1330119/ The founder is quoted in this article saying he is not aware where the allegations of FinanceFWD are coming from. t3n on the other hand confirms the founder (Christian Wien) to be a very good salesman. Wien accuses some of the investors, that won’t get in on the financing round to have an offended ego and being a likely source for the allegations.

Munich

  • SEK Ventures the investment company of the FlixBus founders invests in FreewayCamper, a camping startup from Munich https://buff.ly/36pQaBm

  • Munich-based hospitality startup Limehome expands its Series A to €31 million, with an additional €10 million https://buff.ly/3kn84J4

Companies

Fintech News:

  • Vanta, currently #Berlin’s hottest fintech (raised more than 10 mn € before launch), lost a lawsuit and now has to rebrand. It was too close to the brand of #Berlin-based #fintech Vantik https://buff.ly/323Axgb Vanta offers credit cards for funded startups

  • B2B only: Spotcap sells credit business to Ferratum https://buff.ly/3ogEZBp

  • Swiss Re and Daimler Join Forces to Launch Insurtech Startup Movinx | Fintech Schweiz Digital Finance News — @FintechCH https://buff.ly/3doqiaF

  • Oh No! #Berlin-based #insurtech Getsurance files for insolvency. The business will continue for now. https://buff.ly/3j8o1BK The insurtech was founded in 2016 as Young Finance and later raised funding from investors including Post Finance, Picus Capital, and IBB Beteiligungsgesellschaft. Let’s see where the startup will go. Insolvency, even in times of corona, does not have to be the end of the company. Note: They are only an insurance broker and don’t have your insurance policy on their balance sheet in case you are afraid.

Fintech Leak

Scalable Capital, Germany’s largest Roboadvisor, had a data leak. One-fifth of its clients (20.000) were affected. It appears an employee downloaded data like tax id, address, assets held with scalable … https://buff.ly/3dJzZ3r

Traderepublic numbers and outlook

Berlin-based fintech Trade Republic published results and generated in the 9 months until Sep 2019 725k € in commissions, as well as 228k € in other revenue https://buff.ly/34RSqPt

Related:

Germans are Not Using Banking Apps as Much as Expected, but Are Using Online Trading Apps More Frequently After COVID: Report https://buff.ly/34ZdgMN

Taxes — This time good news

So far #options for employees of startups had an adverse tax treatment in Germany. Now Handelsblatt reports that the government is working on improving the taxation https://buff.ly/36CsklT This is an important step, so employees can participate better in the success of their employer, which will likely also lead to more investments and more startups in the medium term.

Related:

Employee Stock Ownership Plan (ESOP) tax reform for German startups rumored to become reality before Christmas https://buff.ly/34NMZkC

Rocket Internet Corner

  • Alexander Samwer (the youngest of the three Rocket Internet founding brothers) is working towards a conglomerate in renewable energies reports German business media. A vehicle is already listed, called Pacifico Renewables Yield https://buff.ly/2Hyov6I

  • Why Rocket Internet has come down to earth https://buff.ly/2RY1Y5l

Single Company News

Stay ahead of the curve

Automated Transcript Below

Intro

[0:00] Music.


[0:16] Live Events hello and welcome everybody this is Joe from Star operator die all your startup podcast and YouTube blog from Germany we are welcoming you.Month in German startups.Station October 20 20 welcome to this month in German startups by start-up rated arrow in the transatlantic news recording together with Chris from New York hey Chris hiall good let’s roll.Let’s roll you say it today we’re wrapping up October 2024 you with a monster around in the making a 10:26 new information on the very card insolvency and question about published information of Heidelberg basedinsurance that up.Safe you can join us on the entrepreneur Network do — with five years a month you support or work or become a patron atpatreon find the links down here in a blur this recording was made possible by hasn’t trade and invest learn more about our enabler in the link down hereand you can also find the links to subscribe to Tech startups Germany by celebrated our own run.In cooperation with hessen trade and invest down here housekeeping time to brag only thing we have to say right now guys stay safe.

Housekeeping

[1:38] Yes please great.Top news monster fundraising at and 26 on the horizon and 26 ways 2021 fundraising above 3.5

Top News

[1:57] billion US Dollars Bloomberg report26 is considering a fresh fundraising round next year they write people familiar with the matter set as the German mobile Bank ice evaluation of above 3.5.Building.U.s. dollars the funding round could be the company’s final one before it considers an initial public offering as early as 2020 to one of the people said.Pretty you got some more top news for us.


[2:32] Yeah I think that’s really crazy news with an 26 I mean we’ve been talking about them quite often here on the podcast and they are.Also I mean they are not immune to Scandal but yet they seem to be growing and growing all the time it’s crazy.


[2:48] But I have some other news as well for you sothere is another huge deal on the horizon this time with Uber and more traditional German companies because boober offer apparently offered more than 1 billion euros to buyDaimler and BMWs Mobility service free now that that information we got out of manager magazineso the these two traditional very traditional German car makers have held early stage talks about the deal diamondit’s half of free now at 720 million dollars as of June and buber expressed interest in a potential acquisition of free now after the ventures.Efforts to attract additional investors struggle to gain traction omit the coronavirus pandemic we also have another related report to that.


[3:46] About the fact that BMW and Daimler apparently seem to be losing some of their patients.With the now group then we haveCorona which also obviously affects the German startup industry there are some unicorns which are suffering from Corona namely the travel start-up get your guide which let’s go of a sixth of its staffstartup is a unicorn since its latest funding round in May 2019in which the burden based unicorn raised more than 650 or not in which only but in total the berlin-based Unicorn raised more than 650 million u.s. dollars from 24 investors.


[4:33] But we also have unicorns which are profiting from Corona for example hello fresh people stay at home and cook themselves it seems so hellofresh increases projected revenue for 2020 for the fourth timeand now the new revenue forecast is almost double of the 2019 Revenue the company now things that they will make between the print 3.5 and 3.7 billion euros.This year and from another one of those like ten poles / Flagship startups in the German landscapeAuto one we are hearing a bit more about their IPO.The founder of that berlin-based unicorn Harkin coach gives up his Co post and shift into supervisory board ahead of the much.Expected IPO.


[5:30] That is some information that we got from the German startups outside goodness.



[5:38] Yes talking about light towers flag shapes.Talk about a former flag chip away a card we keep you updated here is just a small selection of the news of the ongoing fire cart insolvency the insolvency administrator of wycott announced the sale of.A unit wycott retail services to wounds are you in sir formerly known as Heidel payother news ey faces backlash or well why a card whistleblower from payments they write it backit came to light that you why editor alleged the global accounting firm was warned as far back as 2016 that senior managers at the German payment company may have committed fraud and one.Had tried to pry pan auditor other white card news according to German media reports wire-cut liquidate accuses former management of hiding money systematically before the insolvencyliterally they set in German that the out count have been stripped according to harness but the main source.Could be Jan masaryk former CEO who still fleeing from authorities we have a very special blog post.

[6:56] About him you can find down here in the links in the show notes and I am as capital.Was one of the investors of why I caught who also had to file for insolvency as a consequence of why cart insolvency now I am s Investmentsinvestment the online supermarketget now has to file for insolvency as well likely as a consequence of IMS has insolvency.No good news Chris you got something better with the echo system.

Ecosystem


[7:32] Yeah I think definitely we will be talking about why a card for months if not years to come.But yeah going back to the ecosystem I mean as you may know we like to give you an overview of where the German startup scene as a whole standswe found for example an overview about e-commerce in Germany where it said that the top five companies in Germany account for about 47% of the top 100Revenue the big one here apparently obviously Amazonwhich was a ten point five billion euros but then if you ask me the follow-ups are actually quite close because Auto in Germany it’s a very like traditional department store like.


[8:23] Ecommerce brand Otto has 3.4 billion euros about 1/3 of what Amazon made and then Solano with 1.6 billion euros Media MarktElectronics chain with 1.2 billion euros and notebooks baligacompany that sells laptops online with zero point nine billion euros.We have an overview coming from the German government back.Kfw which administers the money in governmental Corona 8 in Germany saying that 500 German startups.Receive 1.4 billion euros in government Corona 8 and we have news about privateequity and Germany as well where we saw only a dip of 16 percent in total Venture Capital shows even a slight upward Trend according to the German private equity and Venture Capital Associationbvk AP we have the related European data for 2020 as well where it says that VC investment in.Europe is down by about 12 percent in 2020 and we havedata for the third quarter of 2020 where it already hinted at the fact that when it already hinted at the fact that the European Venture Capital pics.

[9:49] In Q3 following a bit of a slower start in the summer and spring months.

Hubs

[9:59] Let’s talk a little bit about Harps this is the place where we try to bring you information fromother cities in Germany because Germany is a very diverse country and their startup activity in many many other cities.Then justBerlin let’s talk first and foremost a little bit above Frankfurt and it’s always a little bit skewed towards Frankfort because I’m based here but first this is a first with a,


Hubs — Frankfurt


[10:29] why I always get the intention to sink y MCA here but first with the Y isLifetouch banks in house near bank for Freelancers and entrepreneurs called first made a soft launch already known numbers have been communicated so farFrankfurt also welcomes coinbase.Frankfurt will be the German headquarter of corn-based they also hired former manager of Georgia Bursar to run their operations there the position.


[11:03] Chief compliance officer is still open if you’re curious and looking for a jobfemale Founders first batch of accelerated Frankfurt FEMA founder program has started.There’s some good news about fundraising in Frankfurt capkikuyu the Frankfurt based lending fintech raises a seven-digit venture capital round with many existing investors adding to their.


Hubs — Heidelberg


[11:30] The city of Heidelberg we hinted it in the intro there have been many reports on Heidelberg based insurance broker intro Techget safe they are raising Venture Capital round which could top out at 50 million euros this would be one of the largest financing roundGermany phone intertek.Ever now the block finest forward publishes some allegations they say they have inflated numbers and used a i.As a bus word only then there is an answer from another tech blog a lot of noise about nothing titles t3n another well-regarded tech block their article on gets saved as a reaction on the article above.You can of course find a link down here the founders quoted in the article saying he is not aware whether the allegations are financed forward are coming from t3n on the other hand confirms the founder Christian Veen to be very good salesmanween accuse a some of the investors that won’t get.


[12:32] In on the financing round to have offended Egos and being a likely source for the allegations let’s talk about the south of Germany Munich Sak Ventures.


Hubs — Munich

[12:44] This is the Investment Company of the flicks bus Founders invests in freeway camper camping startup from Munichand also munich-based Hospitality startup line home expenses series a to whopping Thirty 1 million with an additional 10 million.


Company News


[13:03] Let’s talk a little bit about single companies put I think you got some news there right yeah.Moving on to some of the some of the interesting news they’re on our company base we have some.Stories coming out of fintech companies for example there is vanta.Which some consider Berlin’s hardest fintech right now because it already raised more than 10 million euro even before launch but they lost a lawsuit and now have to Rebrand was too close to the brand of berlin-based fintech van tick.Want a van tick and vanta offers credit cards for funded startups there’s a B2B.Only Approach at spot cap because they sold their credit business to ferritin and there is news about Swiss re and Daimler who joined forces in order to launch and ensure Tech startupnamed moving’s that is actually information coming fromSwitzerland and we have more about that in a link in our show notes from fintech Switzerland.


[14:16] End sad news coming from berlin-based ensure Tech get surance because they had to file for insolvencythe business will continue for now but it was funded in 2016 as Young finance and later raised funding from investors including.Post Finance because capital and IBB battalions gesellschaft we will have to see where the startup will go insolvency.I mean even in times of Corona does not have to be the end of the company.They are only an insurance broker and don’t have your insurance policy on their balance sheet in case.


[14:55] You had business with the company and now afraid so basically it was a reseller.We have a fintech league coming from scalar capital Germany’s largest robo-advisor they had a data leak.


[15:09] Probably you can already hear in the background the sirens coming for them.Little New York style interruption.And one fifth of its clients 200,000 were actually affected it appears that an m.


[15:29] Oh sorry yeah 20,000 were affected it appears an employee downloaded data like the text id address assets held with scalable etceteraand trade Republic published some numbers and an Outlook it’s a berlin-based fintech which published results and generated in the nine months.Till September 2019 725,000 Euro in commissions as well as ruined 28,000 euros and other Revenue.


[16:01] So we’ll see how that goes further and Germans are not using banking apps as much as expected but a using online trading apps more frequently after covid those are some.Results coming from the first let’s say preliminary report.Um and crowdfund inside eye has a bit more informations about this.


[16:25] Well Chris I have some good news from taxes this time so faroptions for employees of startups had an adverse tax treatment in Germany now hundred Splat reports that the government is working on improving the taxation.This is an important step so employees can participate better in the success of the employer which will likely also lead to more Investments and more startupsin the medium term there is related another article Employee Stockownership plans tax reform for German startups rumored to become realityeven before Christmas of course we will keep you posted about this this time I’m taking the rocket internet corner from Christian I know he’s very sad about thatAlexander somewhere the youngest of the three rocket internet founding Brothers is working towards a conglomerate in renewable energies reports German Business Media one vehicle is already listed called.Pacific call Renewables yieldand there is an article why rocket internet has come down to earth this is related to what we talked about in the last news that their D listingfrom the stock exchange.


[17:39] Now let’s get to the last part the single company news Financial show European scooter startup tier is profitable despite covid-19 shutdownhe bike startupsdance it’s the one by the SoundCloud Founders raises 50 million euros in Venture Capital interesting thing Ikea invests undisclosed amount venture capital in berlin-based visual search startupsMira’s reports Dodger start up the startup offers a visual search for retail and Industry.Rakuten da te no longer accepts any new orders.The Online Marketplace announced it will close its doors on October 15 by the date we are recording this it’s already done the decision was made due to challenges with leading the e-commerce business to irrelevantMarket presence that we have just one article in stay ahead of the curve and I do believe Chris.


[18:38] Why Chris was always a pleasure with you are less than 20 minutes and we wrapped up the startup news of a whole month if you like to reach out to the to us go down here in the show notes there’s a link to contact both of usChris as always it was a pleasure and we always enjoy you playing around with their song but with the Sirens in New York yes.Great pleasure by from New York if you’re in the u.s. go vote don’t listen to all the others who tell you to do it listen to us telling you to do it please please please.Bye-bye.


[19:13] And of course stay safe thank you very much and looking forward to see you again next month.


[19:20] Truth truth truth.


[19:24] Music.



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