The large Munich accelerator Wayra repositioned itself last year. The change in strategy also arose from the new CEO Christian Lindener, who took over Wayra in 2017. We spoke with him about the new business model, corporations integrating startups and Wayra’s new resident program.
Wayra repositioned itself last year. What has changed exactly?
Wayra used to invest in startups first and would then try to integrate them into companies. That didn’t work well. There were several companies that never entered into any kind of collaboration. We now visit companies much earlier on in the process to initially get a handle on their fields of technology and the solutions they need. We then look globally for startups that offer the technology they need. In other words, we’ve completely reversed the process. We only invest in the very best now, and when we invest, then it’s in something major. Wayra only invests in teams that we can scale massively beyond Germany over to Spain, the UK and the other eight Wayras in the world. And that’s exactly what we’ve been doing for the last two and half years. Forty of the young companies we’ve supported have 100 percent growth year after year and more than one million euros in annual revenue.
Wayra’s new strategy
So that means Wayra no longer focuses on startups in the developmental stage, but rather on those that are already much further along?
That is correct. When it comes to supporting startups that are just getting started, UnternehmerTUM, CDTM and LMU EC do an excellent job. We only get involved after they’ve received their Exist start-up grant. We then invest up to 500,000 euros, get other investors on board, add Telefónica as a customer and scale them using platforms, international affiliates and, ideally, more than 350 million customers across the globe. Then they become massive. Some familiar examples are E-bot7, Conntac, Relayr and Foodora.
That means you no longer give startups office space or initial support, but instead offer them the opportunity to work with a large company like Telefónica?
Exactly – and that also means with 49 million customers in Germany and 350 million worldwide. They can also access our audio, video, data and AI platforms. It can all be accessed with OpenAPIs and is a huge asset for startups. We only work with startups in IoT, advanced data analytics or enterprise AI – almost exclusively with B2B startups and only a few B2C startups – because that is a different and drawn-out kind of business.
How startups are integrated into corporations
How does Wayra successfully integrate startups into corporations?
The same factors always block innovation in a company: people, processes and legacy technology architectures. We’ve seen that we can hand over as many startups as we want to Telefónica. If you don’t have someone on the other side who is willing to take them in, then it’s pointless, costs time and money and frustrates both parties. Moreover, you can forget the whole thing if you don’t have clean interfaces that function and are fast. That’s why we went through all the processes, built interfaces and looked for the right people. We’ve created an intrapreneurship program, because we said you have to infiltrate a company to be able to get startups in there. Now all of our processes just take thirty days. We also teach startups how to make a B2B enterprise pitch – because it obviously is completely different than an investor pitch or an event pitch. They want to see completely other things.
What has been the most successful collaboration between a startup and Telefónica to date?
One of the greatest successes has been E-bot7, which is also a well-known team from Munich. They were in the office here for a long time before they just got too big. Now they’re located over on Odeonsplatz. There’s also Conntac, a team from Augsburg. They were three hustlers, and now they’ve also become a big team. The company is of much greater value and offers their services not only in Germany, but also in other countries in the Telefónica universe.
How does Telefónica benefit from collaborating with startups?
Telefónica generated tens of millions of euros of additional income through startups last year. We now also offer the program that we successfully developed for Telefónica as a service to other companies. Plus, working with startups also gives us optimal access to innovation. Anyone who doesn’t recognize startups as a part of their digital transformation these days is already out of the game. Additional advantages come from experimenting with new ideas, cost-effective learning and speed, i.e. the ability to quickly implement innovations. Executing an innovative project in a large company can often take years. We can do it with startups in just a few months.
The new resident program at Wayra
So what’s going to happen now to this big office on Marienplatz? All the startups you supported used to be located here. Who’s here now?
Even though we don’t have the seed-stage teams here anymore, we still have 1,000 square meters of office space. That’s something we need to make use of. So we said to ourselves, why not give something back to the community? When you create an ecosystem or a community, then it’s good for the city, attractive to others and gives rise to innovations. Now all the people who organize the events are here along with a few startups, like Smokeless – people from the ecosystem. We also still have our eyes on a lot of young startups. They can use the office space for free. On top of that, we still have our funded startups here and people who come here for workshops as well as our in-house Telefónica colleagues.
And in return? What does Wayra expect from its residents, these startups and individuals, who are using the office space now?
Every resident can work on a resident project. We’re a community after all, so you bring the right people together. The residents are really committed. They love the space and Wayra, and understand what we do. That means we have people out there who spread the word and tell the Wayra story. They can work on their own projects here, organize their own events and use the meeting rooms. You can’t develop an ecosystem with just money, but also by specifically bringing people together.
What exactly do the resident projects look like?
It might be something like a meetup or a Quesadilla Friday. Yesterday, for example, the CTO Round Table was held here. The CTOs met up and discussed their relevant topics. We have a lot of topics, like female entrepreneurs, find-your-cofounder and how-to-raise-money events. So we have all these topics, that we had before too, but now they’re organized by the community for the community.
How can you become a resident at Wayra?
We decide on a case-by-case basis. We look at the person, see if they have a connection to the startup ecosystem, how well they’re networked and what they do. They should obviously want to be live in this kind of the community, implement a project and follow the rules. We started out without rules, but then we noticed it wasn’t working because you actually need a framework. Everyone wanted that too. They wanted to know what they could give back.
And that’s how the projects evolved. So now we have activities like trash dates, which is where we take out the paper recycling together and get to know each other. There’s also a point-based system for things like how active you are with using Slack. Or you ask around here to find out who knows person xyz. If five people say they don’t know who that is, then person xyz doesn’t get the best social points. It’s also just about being an active part of the community.
Advantages and disadvantages in the Munich ecosystem
What do you like about Munich as a location, and what’s missing?
Munich is a great location for B2B startups because of the local corporations. You have the golden triangle of corporations, investors and academia. Everything an ecosystem needs to take off originates in that triangle. Something that is still very much in need of improvement is that we have a lot of players in the system here that are doing the same things, but their networking is awful. Everyone is doing their own thing and isn’t up to doing something together. For example, everyone organizes their own demo day here. So we suggested maybe organizing one together. Now we’re working on the Summer Expo. It’s the first time something like that has happened. We could still do a lot better.