German entrepreneur Rolf Herken is setting up a new startup incubator and fund in Berlin and San Francisco, designed to attract experienced scientists and engineers.
Herken founded 3D software company Mental Images – best-known for a rendering tool used in Hollywood hits including Harry Potter and the Chamber of Secrets and The Matrix – in Berlin in 1986 and sold it to US firm NVIDIA in 2007. He started a second company in San Francisco in 1999, which merged with Mental Images/NVIDIA.
Now, two years after leaving the combined company, he wants to make it easier for talented researchers to start companies without the financial risk of a “normal” startup.
There’s no shortage of accelerators and incubators in Europe and the US but this particular model is unusual. Herken’s new incubator, MINE Innovation Engineering, will offer scientists and engineers “competitive” pay and benefits to work on prototypes for new products. It could be new processing technology, artificial intelligence, robotics, energy, life sciences – anything with the potential to either be a major technology breakthrough or affect a billion people, Herken said.
If the project makes it through feasibility studies then, typically after 18 to 24 months, it will be spun-off into a new company co-owned by the team and MINE.
At that point, sister entity Reality Ventures, which also funds MINE, will step in and provide funding (so the team “doesn’t have to be exposed to that stress immediately after launch”, Herken said).
Reality Ventures itself will be backed by up to five strategic investors. Only one, French design software company Dassault Systèmes, is confirmed. According to the Wall Street Journal, each investor will be expected to put in $25m – though, according to briefing materials, this will be in increments up to a maximum rather than upfront.
The management team at MINE includes Larry Tesler, a former Apple chief scientist who’s also worked for Yahoo, Amazon and 23andMe. The company says it intends to hire over 20 scientists and engineers over the next six months.
While the incubator’s offices are in Berlin and San Francisco, this is because it’s where the legal entities are set up – it won’t be necessary for recruits to move to take the job. “If things go well, MINE can have branches everywhere,” Herken said.
A bold idea – will it work?
It’s a bold project from an entrepreneur with a low public profile given his track record. Will it work? There are few exact precedents. In Germany, the Samwer brothers’ Rocket Internet has found success churning out dozens of well-funded online ventures but based on existing business models rather than breakthrough technology.
“Innovation lab” Liquid Labs in Hamburg is a closer match – it aims to develop and launch new financial technology products, sometimes to spin off as startups but with a stated priority of building new products for corporate owner the Otto Group.
Paul Jozefak, who worked in venture capital before founding Liquid Labs, said he hadn’t heard of Herken but liked the sound of the project. “It’s very much is in line with how we think – it’s basically disrupting venture capital and taking a new approach to it,” he said. “Is there room for this? Sure, there’s always room for people with innovative ideas and the energy and means to try. It ultimately is all about execution.”
Proven execution here, of course, is still some way off – the next steps for Herken, MINE and Reality Ventures will be securing other investors and bringing top talent on board.
Image credit: Flickr user Travis Isaacs