SMEs and start-ups

One wheel meshes with the other. This image is synonymous with "successful collaboration". But why is it still inconceivable to many entrepreneurs that such collaboration also works between SMEs and startups? For example, a Bitkom survey of 604 companies with 20 or more employees says that around two-thirds of SMEs across all industries do not collaborate with start-ups. Wasted innovation potential - as our expert Tanja Flügel explains in the following interview.

Tanja, what challenges do SMEs often face?

Tanja Flügel: SMEs in Germany are characterized in particular by customer proximity. Thus, they can respond quickly and flexibly to individual market changes and customer needs. At the same time, however, SMEs are struggling with challenges such as business succession, a shortage of skilled workers, digitization and sustainability.

How can startups help with these challenges?

Tanja Flügel: Digitization has really picked up speed again as a result of the Corona pandemic. According to this, an increasing number of German SMEs want to digitalize their processes . This is a topic area in which start-ups have already successfully positioned themselves and can both offer solutions and further develop solutions together with SMEs.

Can you explain the theory using a practical example?

Tanja Flügel: Gladly. Let's stay with digitalization: a start-up from our network has developed software based on artificial intelligence that records, analyzes and evaluates data from the production process. In this way, the error rate during a production process can be reduced in the future. Fewer errors ultimately mean lower costs for an SME. At the same time, however, the start-up also learns through the collaboration and can optimize the software even more specifically for the production process and thus further develop its own product - in this case, the software. A great win-win situation.

How can start-ups help with the challenge of a "shortage of skilled workers"

Tanja Flügel: In order to successfully digitize business processes in SMEs in the long term, skilled workers are needed. So far, however, foreign specialists have unfortunately encountered various hurdles. Starting with the visa and the filling out of various documents up to the visit of the authorities. That's why a number of start-ups have already positioned themselves here to help skilled workers find jobs in Germany. At the same time, start-ups also benefit from the cooperation in this example. Start-ups are, after all, small companies with few employees. And by working together with SMEs, they have the opportunity to open up new sales channels, gain access to new customer groups and supplement missing know-how. So through the exchange of expertise and experience and access to resources, both sides benefit.

Do you have another concrete example from practice for our readers?

Tanja Flügel: Yes, I have a very nice example from our specialization field mobility . A few years ago, a research team (later start-up) was established at the Technical University of Munich. Its first goal was to develop a modular vehicle prototype for rural Africa . The second goal was: to produce the vehicle permanently in Africa from a later date in order to have the added value locally. Now the team was faced with the question "Who can support us in turning our plan into reality?". Which medium-sized company is willing to make a prototype with us at such an early stage?" This is where we at Bayern Innovativ came in: We asked suppliers and companies from the automotive industry in our network. And we actually found three partners who developed this prototype together with the start-up. Ultimately, the desired manufacturing process was also developed to enable production in Africa.

So in this case, you supported the start-up by finding suitable partners. How do you also support Bavarian start-ups?

Tanja Flügel: Everything starts with the fact that we develop the original idea of the start-ups so that we can later address possible partners - as in the example just described. In the second step, the question arises "How do we finance the further development?". This is where funding programs help immensely. That's why we work closely with our colleagues at Förderlotsen Bayern . Then the time has come: the idea has been developed, the project has been launched and the funding is on its way. Now, in the third step, we have to find the right partner. We have very good opportunities here to draw on our networks, because we work across industries and technologies. For example, we inform cluster partners from the automotive and New Materials about start-ups with a brief profile and establish contact if interested. Fast, agile and uncomplicated! Last but not least: The new product still has to be marketed. Here we support among other things with product presentations on our website or with our community booth at renowned trade fairs . A perfect opportunity to present one's own product to a broad mass.

The interview was conducted by Dr. Kord Pannkoke, Head of Business Development at Bayern Innovativ GmbH.

Listen to the full interview as a podcast: