After five years of bootstrapping – Celonis receives 27.5 million

rising-stars-02
rising-stars-02

The history of Celonis is unlike most startup stories. So far, the three founders Bastian Nominacher, Martin Klenk and Alexander Rinke have built their business without someone else’s money. And the success is impressive: last year, Deloitte named the software developer among the fastest growing tech companies in Germany. 80 employees work at the startup in three locations and the clients include Bayer, RWE and the bank UBS.

Some investors are said to have knocked on the door of the startup from Munich. The time has come: The well-known investor Accel, 83North (formerly Greylock) and several business angels invested 27.5 million dollars in Celonis. Especially in the US, the business is expected to grow.

Many companies are not familiar with “process mining”, says founder and CEO Alexander Rinke. With Celonis’ software, you can compare how well processes work in a company. In real time, companies can analyze how customers behave, for example, in an e-commerce store and when they cancel a purchase. Each so-called ‘touchpoint’ flows into the software.

Last Tuesday Celonis founder was sitting at the HEUREKA conference and discussed with other promising startups of the scene. He told how Celonis was founded in 2011, quickly made good sales – and directly made the mistake to hire experienced, but inappropriate for the startup sales people – “who simply did not sell. That was a fuck-up! But at the end of the year I had driven more than 100,000 km and made sales myself, like my co-founders. Finally, we were still growing in the year, although this staff took a lot of money.”

At the time of the conference the investment was not yet official – now in a Gründerszene interview he talks about the background.

Alex, for four years you have been bootstrapping your company. Why do you now get yourself venture capital?
In fact, we started with about 10,000 euros and have grown strongly over the years, even without external money. We were approached in the past repeatedly by investors – so far we have always said no. Accel and Greylock are investors who have a lot of experience with enterprise software. They know just how to build a unicorn.

You already have well-known companies as customers and have grown well. Why do you need this experience at all?
The market for process mining is incredibly large. We are the market leader by far, but we need to develop the market still. It is about the question: How do I create a new category? Because process mining is not a household name for many companies. Especially in the US, we want to expand our business and the investors and business angels have experience, in particular regarding marketing and sales.

Last year you started a SAP partnership: The company now distributes your product. With this your international sales have risen. What’s different about the investors?
The cooperation is going very well. SAP pushes sales strongly, bringing our product to many European markets and to Asia and America. With the investors we bring the idea to a new dimension in terms of expansion in the United States. We also want to develop the product with the money.

What new products are you planning?
Our original product analyzed processes. For example, for a production of 20 million units per year, the company sees each station of the supply chain and each processing step. And understands where the problems and potentials are. It may be, for example, that a part will be shipped for production to China, although it could also directly go to Japan for the next step in the production chain. Or the lack of coordination with suppliers leading to repeated delays. These processes can be analyzed in real time.

We enable customers to benchmark themselves. If, for example, as a company my outbound shipments have a turnaround time of ten days, I can compare the data anonymously with competitors. This clarifies the question whether ten days is a good or bad value now. All companies are under pressure and it is increasingly clear that they cannot further reduce labor costs not even in Asia. But productivity must rise. And we are good in analyzing that.

You have worked for some time together with SAP. Apart from the distributorship you have participated in their startup program. Why has SAP not invested?
The SAP is ultimately not a venture capital investor.

This article was originally published on Gründerszene.

Image: Gründerszene/Georg Räth