Investing as a medium-sized company in startups? – Dresden-based Avantgarde Labs GmbH collaborates with Fusion Bionic and 4D-Energy

The fact that medium-sized companies not only collaborate with startups but also actively become investors is still a rare occurrence. Avantgarde Labs GmbH, a software company with 50 employees based in Dresden, has taken a unique approach in this regard. Founded in 2007, the company is providing financial support and practical assistance to two startups in implementing software solutions. We spoke with Managing Director Torsten Hartmann about what this collaboration with Fusion Bionic and 4D-Energy means for his company and the challenges the teams have overcome.

Could you tell us a bit more about these two startup collaborations?

Certainly! As part of our own research efforts, we became members of networks consisting of investing companies. Over time, this led to what is known as a “deal flow.” These are, at times, daily indications of interesting investment opportunities. This is how I became aware of Fusion Bionic. I proactively approached the company and contacted the managing director. As for 4D-Energy, another entrepreneur gave me a tip, saying literally: “I didn’t understand anything, but you must definitely talk to them!”

Obviously with success! What exactly do your cooperation partners from the startup scene do, and how do you support them?

Fusion Bionic specializes in laser surface functionalization. 4D-Energy operates in energy trading, with a focus on large-scale batteries. We support both companies as investors and have assisted them with our team and IT skills in further developing and scaling their software solutions.

Successful startups often have the luxury of choosing their investors and cooperation partners. What do you think convinced them to work with you in your case?

I believe that these startups could have obtained funding from other sources as well. What made the difference was the prospect of being able to quickly develop and scale products through our IT skills. For startups, it’s challenging to find skilled and versatile IT professionals, as they often receive more lucrative offers from corporations. However, we were able to offer them precisely that.

Moreover, the contact is undoubtedly more personal. Large investors have portfolios with startups, knowing that 60 percent of them may fail. In contrast, we engage with a lot of passion and dedication. Ultimately, a lot is at stake for us as a company in these collaborations.

What does that mean?

As a medium-sized company, it has a significant impact on us if the startups we collaborate with do well. That’s why we are deeply committed to supporting them. We are large enough to bring genuine value and small enough that the success of the startup truly makes a difference for us. I believe this creates a very healthy incentive system from the perspective of the founders.

How did you manage to overcome the typical cultural differences between startups and established companies?

There have been instances where I realized that our working styles were different. For me, the lesson was to let go to some extent and follow my intuition. I believe it’s essential to place a certain level of trust in startups and not impose our goals entirely on them. At the same time, I’m happy when I can contribute something myself, such as sharing knowledge about methodologies for entrepreneurial decision-making and effective company management.