19. June 2012–
Lars Hinrichs, founder of Xing, creator of HackFWD and the man with Angela Merkel’s ear on matters of digital policy, speaks to VentureVillage on what he looks for in a killer product, the Berlin Bubble and what it means to be a geek…
I am in love with engineers – because engineers innovate... businessmen copy
I think that engineers are the artists of the 21st century. In Europe we don’t have the tendency to support or encourage tech enough. Just compare it with Silicone Valley – most CEOs of the large companies such as Google, Facebook etc are engineer-driven.
In Europe we have a tendency for MBA-driven companies – and this sets a different tone. If you’re an engineer you can understand technology and create something new. If you come from an MBA background you can more easily copy something rather than innovate.
The whole concept behind HackFWD is “geeks only” – we provide the support in business development, marketing and product strategy that these guys need, but we’re dedicated to techies and engineers.
The best explanations I heard ever is from Carlo Blatz that a geek is “a nerd with a girlfriend”.
Am I a geek? I am a bit of everything. I saw your Cap n’n Crunch story recently – I was a phone phreak 20 years ago. I have been online for longer than some of our HackFWD applicants have been alive – I was first online in 1989.
A good product should captivate
When we look at applications for HackFWD, we don’t even require a business model. What we want is something that is unique, new, captivating and which we would use. We want things that make sense, made by engineers.
There is a hype bubble of Berlin. There is some stuff that completely doesn’t make sense but that gets millions of Euros funding. From my viewpoint out of Hamburg I can say that there is plenty of hype going on in Berlin. But it’s pretty much anywhere that’s labelled as a tech hub.
I’m a helicopter person rather than a slow-boat person
When we took Xing public, it meant that the company slowed down. People would suggest new features and I would be told that implementation would take a couple of months. The larger a company gets the more management gets involved and the less the engineers.
I prefer helicopter management – just go down, change everything, leave and let someone else build it. This is what I have now with 16 companies in HackFWD. It’s ideal, as we can make swift decisions and build and test quickly.
We haven’t had what you'd define as a success yet – in that we've had no return of equity or liquidity event – we are still in the hoping phase. But the HackFWD companies have enjoyed some significant milestones: Fantasy Shopper is the first non-US company to win the AWS competition, while Hike has monitored metrics for over 75,000 Facebook applications, Cobook has been the best-selling app in lots of countries, WatchLater has created over 10 million bookmarks and Infogr.am has been perhaps even been over-accelerated. We're hoping that measurable success is near, but we're happy to have provided the support system for these products to grow and develop.
European founders need to reinvest
This is how things have to work. People like Niklas [Zennström, co-founder of Kazaa and Skype who now runs Atomico, an investment firm specialising in disruptive tech companies] and Heiko Hubertz [founder of BigPoint Games] who make money and reinvest it – this is probably the best money in Europe.
The US thinks bigger and not just for the home market. There is much bolder, A-round financing, at least twice the size of ours. This means that companies can grow and focus later on monetisation – we just don’t have that luxury. There’s also more collaboration between companies in Silicone Valley.
But I don’t think it’s an issue of attitude or education – it’s just that the US has a 20-year head start.
Facebook *is* the internet right now
And it will be the interenet for the next 2bn people who go online. The internet is still going through phases – for most people email was the first phase, with Google spearheading the second. The third is definitely Facebook, and I’m still super-bullish about Facebook; I think the veneration we see will still be significantly bigger in the future.
I organised a very nice meeting with our Chancellor and we addressed a few key issues on the tech and startup scene [Hinrichs recently met with the German Chancellor. He Tweeted: “Enjoyed 90min confidential discussion w/ Angela Merkel & @RegSprecher "Internet & Entrepreneurship" a lot. She really gets it.]
I can’t tell you the specifics of the talk, but we made our points – we want to create even better entrepreneurship opportunities. Everyone sees these opportunities. The internet has changed every sector in our lives and changed every industry. It already contributes 3% of our GDP, so this means that you have to speak on the highest government levels, and let’s just say that their involvement is changing...