To improve the start-up climate at universities and increase the number and quality of technology-oriented and knowledge-based start-ups. The EXIST funding programme has been dedicated to all these objectives for over 20 years. The start-up grant is a central component of all this: who gets it, what is involved and what is important.
The year 2000: The dotcom bubble bursts, payments are still made in Deutschmarks and nobody has heard of the start-ups Tesla, Airbnb and Spotify – they don’t even exist. In the same year, the German government launches its extensive EXIST-Seed programme. It is explicitly designed to support science start-ups in setting up their own businesses. Initially for students and scientists in selected model regions, from 2005 onwards nationwide. In 2007, the programme was renamed EXIST-Gründerstipendium, which has remained the same until today. In two decades, the programme has supported more than 2,500 teams.
Many of these sponsors came and still come from the beyourpilot Associated Universities. Most recently, the project was able to announce as many as eleven successful grants in a row – in the meantime, the number has risen to 15. A remarkable achievement, since on average only every second application is approved.
The Federal Ministry of Economics and Energy also rewards such achievements with a one-year grant consisting of 30,000 euros in material resources per team, a 5,000 euro coaching budget and a direct monthly allowance for the founders. This amounts to between 1,000 and 3,000 euros, depending on status and degree. “This is precisely the great attraction of this programme. By covering the cost of living, it enables the founders to concentrate fully on the start-up project,” says Angela Borchert, who as head of the HAW Hamburg start-up service has accompanied numerous EXIST teams in recent years.
This focus on one’s own foundation is usually also necessary, because at the end of an EXIST year, nothing less than the marketability of one’s own development should be achieved. “Conversely, of course, this also means that EXIST is not suitable for me if I am not able to achieve this in the foreseeable future. Then you should sit down as a team and do some more preparatory work,” says Angela Borchert. “If I only have something half-finished in the end, it will be extremely difficult to find new sources of funding. Because in such a state, no VC will be able to access them. In the worst case, my start-up project will already be at an end”.
To make sure that this does not happen, every application is put through its paces by the project sponsor. “The focus is on two things. One is the idea sketch, which should convince the reviewers of the feasibility, uniqueness and above all sustainability of the project,” says Lisa Jessen, who works as a start-up consultant in the beyourpilot project. “On the other hand, you should also take a close look at the composition of your own team – because as a founding team you have to bring an extremely wide range of skills with you. Development, sales and accounting are just some of the topics I am quickly confronted with. Of course, the project sponsor is aware of this and also looks closely at the ‘fit’ of the team.
It is therefore not surprising that 76 percent of all teams funded last year consisted of three members, even though funding for teams of two and one person is possible in principle. In contrast, the proportion of women in the teams was negligible – just 14 percent last year.
Alternatives to EXIST funding are, for example, the InnoRampUp and InnoFounder Programmes of IFB Hamburg, Accelerator Programmes, start-up competitions or crowdfunding. The problem here is that many of the alternatives do not work in the pre-founding phase, when EXIST provides funding. They often require that a team has already been founded or has reached certain milestones. Therefore, they often serve more as a possible follow-up financing – because three-quarters of the funded teams manage to start up on average during their EXIST period.
“When I have generated my founding idea from my studies or my work at the university and am still at the beginning of my career, EXIST is and remains ‘the way to go’,” Lisa Jessen is convinced. Accordingly, the Founding Advisor hopes that the scholarship will be a decade or two behind.
Founders interested in EXIST can contact beyourpilot or their local university directly. In an interview, the conditions and chances for a successful application can then be sounded out.