A normal year, hyped startups, schadenfreude

Most startups are not successful. This is especially true if you look at companies at the seed stage. It doesn’t matter if you get a lot of attention or not (although good PR can help attract talent, users, etc. which may lead to a higher success likelihood) – it still is very, very hard to pass on to the next stages and become a large company.

What we are seeing this year in Berlin is the following: some companies failing (although none having raised significant amounts of capital), others succeeding, hidden champions coming out of nowhere, some bigger companies stagnating and others again really claiming the global category leader position with exponential growth. Sounds like a perfectly normal year, this is how this game works. Every year should be like that in terms of how companies develop.

The scene here is going from strength to strength and I think you’ll find most people, with sufficient data points and insight into the ecosystem, will agree . It’s still a super long journey though and there will be ups and downs. This is the beginning of something – nothing more, nothing less.

So some companies that are going to be sold or shut-down this year may have gotten more attention than others. What’s super lame though is to go around and kick these folks in the nuts when they are on the ground. As a maturing ecosystem we should be helping them up and give them the resources to go and have another shot. Schadenfreude is really one of the very worst traits of the human character.

Most of these “hyped” startups got a lot of attention for very specific reasons: i) they were building a tangible consumer product that was ‘cool’ or different – very accessible, everyone can have an opinion and write about it ii) the founders were simply more open and media savvy than maybe in the past in Berlin iii) they raised money from well-known investors iv) as a free consumer product, PR is always going to be a great way of getting your product out there and the teams understood that v) creating a buzz around a company with PR is a good thing in most cases (hiring, partners, etc) and they went and did it and vii) a fledging media landscape happy to cover a lot of stuff that would get less attention in more mature ecosystems.

However, all of these so-called “hyped” startups were / are led by super solid, hard-working teams that never pretended to be something they weren’t. Why on earth would you give these people an extra hard time if things go South? They were doing their job. So don’t be a super-lame-nut-kicker-when-people-are-on-the-ground person and indulge in schadenfreude – it will get you nowhere.

So let me finish off by saying so far this has been a great year. A few seed companies failing is business as usual. Nothing to see here, lets move on.

13 Comments on “A normal year, hyped startups, schadenfreude”

  1. This is so German, it’s just sad.

  2. Steve A says:

    I disagree.

    Have a look at 5wunderkinder, one of your investments. First they spent weeks touting against “copycats”. Being a simple and free to do app, well.. Then they spent weeks complaining against the mayor of Berlin not being interested in startups. Press everywhere. And a lot of anticipation for their new product. But when they tried to deliver everything went wrong: Security issues, scalability issues, missing features.

    “Super solid”? “Hard working”? Maybe. But you should keep your mouth shut unless you got a functional product. Amen 🙂

    • berlinvc says:

      Hi Steve. They have millions of active users so its fair to assume they have functional product. Yes it is simple and that is their core philosophy. Yes the launch was rocky but they recovered and are growing significantly. That happens with startups. They are a bit loud on topics concerning the ecosystem – not everyone will like it but it does no harm.

      • Steve says:

        Millions of users? I bet you a good old bottle of champaign that the wonderkids are not going to make enough money either in revenues or in trade sale value to recover the money spent. Send me an email in 12 months time.

        I see other companies doing very well without all this hype nonsense: SoundCloud, ResearchGate, Mister Spex. So yes, I got some Schadenfreude for the hyped failures and I got ten times more respect for the less hyped real stars!

      • berlinvc says:

        Time will tell. 6W is not the subject of this post. On failed startups – schadenfreude ist still a very poor character trait Steve. But I’ll stop feeding the troll now 😉 I’m sure you have my email – feel free to ping me there and happy to have a more factual debate

  3. Carsten says:

    Agree 100%. Two of the main problems we have for entrepreneurs in germany are investors who are too risk avers and the stigmatisation of failure. Germans just love security. The super-lame-nut-kicker-when-people-are-on-the-ground people are just proof for that. We still have a long way to go, but it`s getting better 😉

  4. Eva Nicole Seidel says:

    Unfortunately, some humans (not only Germans) need this superior feeling of Schadenfreude, when their Ego feels weak and small.
    They could create more constructive ways to experience strengh and grandness!
    Thanks for the article 🙂

  5. […] Anfang von etwas – nicht mehr und nicht weniger“, schreibt Earlybird-Partner Ciaran O’Leary in seinem Blog und zitiert als Gewährsmann den Benchmark-Investor Matt Cohler, der Berlin Chancen einräumt, ein […]

  6. Ulrike says:

    What’s up, yeah this post is in fact pleasant and I have learned lot of
    things from it concerning blogging. thanks.

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