THE 2010S DECADE

bm|t and our Investee-Part­ners, who are the true dri­vers of our suc­cess, pro­gressed sig­nif­i­cantly over the last ten years.  At the turn of the last decade, just after the finan­cial cri­sis, we had more insol­ven­cies than evi­dence that our model and efforts were bear­ing fruit.  For­tu­nately, over the last ten years, cul­mi­nat­ing in an excep­tion­ally strong last three years, many sig­nif­i­cant pos­i­tive events occurred, reward­ing the hard work our Investee-Part­ners and bm|t had put in and giv­ing us con­fi­dence that we are ful­fill­ing our impor­tant mis­sion: To strengthen Thüringen´s econ­omy through tar­geted invest­ments in inno­v­a­tive com­pa­nies with high growth potential.

We have gained great con­fi­dence that we are ful­fill­ing our mission.

Note­wor­thy high­lights from the past decade were being the lead investor in Facebook’s first acqui­si­tion in Ger­many (fayteq) and InflaRx, which had a suc­cess­ful Nas­daq IPO and raised more than 200 Mio. USD over the last four years.  Addi­tion­ally, we had a par­tial exit of PDV Sys­tems, real­iz­ing a triple-digit IRR over three years on a size­able invest­ment.  In 2019, we also led two trade sales (HASEC sold to a pub­licly-traded com­pany in Fin­land, Scan­fil, and we sold our stake in Lyna­tox to Dier­sch & Schröder, a large fam­ily-owned busi­ness in Bre­men) to ideal strate­gic part­ners that will invest sig­nif­i­cantly in the acquired com­pa­nies here in Thüringen.

Per­haps sur­pris­ingly for a ven­ture and pri­vate equity investor in Thürin­gen, invest­ments in pub­licly-traded com­pa­nies were also key to our suc­cess over the past decade.  In addi­tion to InflaRx, Ana­lytik Jena and Carl Zeiss Meditec are high-per­form­ing com­pa­nies that pro­vided excel­lent stock returns for our funds. And cer­tainly the most sig­nif­i­cant event of the past decade was that in 2011 bm|t made its largest ever sin­gle invest­ment, in Jenop­tik.  We are cur­rently the largest sin­gle share­holder of the com­pany, and have gen­er­ated a total return (stock appre­ci­a­tion + div­i­dends) for Thürin­gen of 235% on our very size­able investment.

Thürin­gen and bm|t are on the invest­ment map in Ger­many and abroad.

All of these events and devel­op­ments of the last decade have put Thürin­gen and bm|t on the invest­ment map in Ger­many and abroad.  bm|t and our Investee-Part­ners have pow­er­ful momen­tum head­ing into the next decade, and we firmly believe we can build on that momen­tum in the years ahead.  The cumu­la­tive advan­tages of our expe­ri­enced and well-net­worked team, our cur­rent strong port­fo­lio of 59 Investee-Part­ners, and an excel­lent cadre of co-investors that have been built over the last two decades posi­tion us well for the 2020s.

THE 2020S AND BEYOND

We are enter­ing the new decade with high con­fi­dence but also acknowl­edg­ing that we and our Investee-Part­ners have a tremen­dous amount of work ahead to con­tinue to pro­duce strong results for Thürin­gen, espe­cially in light of the chal­lenges that we and com­pa­nies in Thürin­gen will have to over­come.  As in all regions of the world, we face the chal­lenges of increas­ing inter­na­tional com­pe­ti­tion, keep­ing pace with the accel­er­at­ing rate of change, dig­i­tal dis­rup­tion, etc.  How­ever, those fac­tors also offer great oppor­tu­ni­ties if approached boldly and with cre­ativ­ity.  We feel that our Investee-Part­ners, given the high level of inno­va­tion in their prod­ucts and ser­vices and their increas­ing abil­ity to cap­i­tal­ize on global mar­kets, trends, and oppor­tu­ni­ties, will pre­dom­i­nantly ben­e­fit from these factors.

We see great oppor­tu­ni­ties if we and our Investee-Part­ners approach chal­lenges boldly and with creativity.

The most sig­nif­i­cant chal­lenge we presently see – where it is a bit more dif­fi­cult to see an equal or greater oppor­tu­nity on the other side of the coin – is the scarcity of local skilled labor (Fachkräfte­man­gel) across Ger­many.  This chal­lenge is def­i­nitely height­ened in the new fed­eral states due to the migra­tion of young, moti­vated work­ers to the West since reuni­fi­ca­tion.  With a sig­nif­i­cantly higher aver­age age in the new fed­eral states com­pared to the old fed­eral states* it is clear to see the accen­tu­ated per­son­nel chal­lenge we in Thürin­gen are fac­ing.  In fact, the major­ity of our Investee-Part­ners view the dif­fi­culty of find­ing appro­pri­ate tal­ent as one of the major chal­lenges in grow­ing their companies.

Neces­sity is the mother of inven­tion, and founders have responded to this real­ity cre­atively in the design of their busi­ness mod­els.  We undoubt­edly will have many more suc­cess sto­ries of com­pelling tech exits; how­ever, since we also want to see the cre­ation of new Thürin­gen Cham­pi­ons – part of our vision at bm|t – we and our Investee-Part­ners need to be inno­v­a­tive in over­com­ing the hur­dles cre­ated by the scarcity of qual­i­fied local labor.  Think­ing and act­ing more glob­ally, set­ting up satel­lite loca­tions in other geo­gra­phies, dig­i­tal work­spaces, cre­ative recruit­ing tac­tics, being bold and push­ing bound­aries, etc. will need to be part of our col­lec­tive reper­toire in the years ahead.

bm|t has the will­ing­ness and abil­ity to sup­port Investee-Part­ners who think cre­atively and act boldly to sur­mount the var­i­ous chal­lenges ahead.  We have great momen­tum after a strong last decade and have well-founded opti­mism for the future.  We look for­ward to work­ing with our val­ued part­ners to pro­duce many more suc­cess sto­ries made in Thürin­gen in the 2020s and beyond.

Your bm|t Team

* https://www.zeit.de/politik/deutschland/2019–05/east-west-exodus-migration-east-germany-demography