A matter of attitude
Creating an innovative product is one thing, but marketing it appropriately is quite another. Yet the creative output is certainly available in Germany, not least at the higher education institutions and universities in which significant discoveries are constantly being made, and new technologies developed. All that’s required is for greater exploitation of this potential. It is therefore not surprising that the academic sphere is increasingly attempting to combine inventiveness and entrepreneurship by supporting students and researchers in their design of start-ups – and in parallel to delve into the mechanisms of so-called entrepreneurship.
A definition of entrepreneurship extends back to the 18th century with the work of Adam Smith. Since then, the term has repeatedly evolved – its French pronunciation has nowadays become a synonym for start-up founders. ‘Entrepreneurs are characterised by the fact that they pursue a vision’, explains Gabriele Schäfer, Business Administration Professor at Kempten University of Applied Sciences, head of its Start-up Centre and board member of the think tank, a network for higher education staff working in the start-up environment. ‘We’re talking here about people who want to introduce something new, and are prepared to take a few risks to do so. They aren’t primarily inventors, but rather innovators who are convinced that their ideas can make the world a bit better. This attitude is not necessarily linked to a product and can even be embraced by employees within an existing company.’
‘An entrepreneurial scholarship can be a great relief for start-ups’
Under public funding programmes, conversely, every entrepreneur must have a specific business idea that can be placed on the market. ‘Around 50 per cent of the applications for one of our EXIST entrepreneurial scholarships involve something to do with software or digital services’, explains Dr Thomas Großmann, head of ‘Founder networks’ at Project Management Jülich. He is responsible for administrative supervision of the EXIST funding programme operated by the Federal Ministry for Economic Affairs and Climate Action. ‘This is partly because the scholarships are restricted to a year, and the fact that material and coaching funds are limited to a maximum of €35,000, which still enables digital projects to be implemented relatively easily within this context, but also the fact that this field still has a huge amount of potential. An EXIST research transfer on the other hand, where the results of a larger university research project are often brought to market via a spin-off company, more frequently involves deep-tech start-ups, medical or biotech products.’
Großmann believes in particular that an entrepreneurial scholarship can be a great relief for start-ups. ‘The approval rate in this area is higher than 50 per cent’, he says. ‘The prerequisite is that the business idea must involve an innovative, technology-oriented or knowledge-based product with significant unique selling propositions and good prospects for economic success. The applicant's nationality or the type of their degree aren’t important to us.’ The application is generally submitted via the respective university – most of them now have some kind of start-up centre to advise students, and to guide them on the path to entrepreneurship. ‘The entrepreneurial support at our German higher education institutions has by now reached a good average level’, Großmann confirms. ‘A lot has happened in this area in the last three to four years, especially at technically oriented higher education institutions. Although there is still a lot of room for improvement – the federal states in particular are also obliged to provide more money.’
Even failure has to be learned
In fact Gabriele Schäfer also emphasises the sometimes major differences between academic start-up centres. ‘Many higher education institutions are sadly chronically underfunded, which impacts negatively on their support for younger entrepreneurs.’ At the other end of the spectrum there are larger organisations like the Strascheg Center for Entrepreneurship at Munich University of Applied Sciences, which is considered to be one of the leading institutions of its kind. ‘We want to act as sparring partners for our entrepreneurs’, explains its leading Professor Herbert Gillig, ‘throughout the entire process. We conduct an initial consultation to analyse the actual stage that the founding team has reached. There are 24 weeks of regular mentoring, equipment and a workplace, and then we reconsider matters. It is of course clear that not every start-up can be a success. Sometimes the team falls out, or alternatively the product fails in terms of its potential buyers.’ That too has to be learnt. ‘At least we offer our students a safe environment where they can gain these experiences without getting directly into debt.’
The balance between social responsibility and financial success
In any case, the fixation on monetary success that prevails in the sometimes very competitive market cannot quite be reconciled with the original image of an entrepreneur in all his or her facets. Sustainable and social entrepreneurship in particular, which aims for positive transformation in society and considers profit as secondary, is difficult to support via traditional funding options. ‘From a researcher’s perspective, this results in significant tensions, including how to ensure the balance between social responsibility and financial success in the modern era’, emphasises Professor Gillig, who explicitly advocates a triad of qualification, mentoring and research in the field of entrepreneurship. And from a practical perspective? ‘We try to use our higher education institutions and think tank network to set a counterpoint’, stresses Professor Schäfer. ‘An aspect such as sustainability is such an important topic – an entrepreneur simply can’t afford to ignore it in the current climate. Unfortunately, however, this also means that many companies engage in green and social washing, in other words they pretend to be ecological and social yet they don’t really live by these values. We can only use our higher education institutions and start-up centres to encourage students to choose a different path.’
Author: Thomas Kölsch
Dr Thomas Großmann
Professor Gabriele Schäfer is Business Administration Professor at Kempten University of Applied Sciences, head of its Start-up Centre and board member of the think tank, a network for higher education staff working in the start-up environment.
Professor Herbert Gillig heads the Strascheg Center for Entrepreneurship at Munich University of Applied Sciences; he is also a board member of the think tank.
Dr Thomas Großmann is head of the founder networks at Projektträger Jülich, which in turn coordinates and implements the EXIST funding programme operated by the Federal Ministry for Economic Affairs and Climate Action.