The term “company builder” is often used when talking about companies which launch and build startups. Their job is similar to what an incubator or accelerator does which is why these terms are often used interchangeably.
There’s a difference, however: With incubators and accelerators, the external persons or startups who apply for these programs usually bring the ideas with them. Classic company building originates in the companies themselves. The company develops an idea internally and recruits a team which fits the job as a second step. Their next priority is to support this startup they created as efficiently and quickly as possibly on its way to success.
A good company builder – which, in rare cases, can also be an individual person – has the financial resources and the network to be successful in different markets. This gives them an advantage over lone wolves who depend on external money and knowhow.
Rocket Internet is Germany’s Biggest Company Builder
The slogan says it all – “We build companies”. Rocket Internet leaves no doubt about what they do. They think of themselves as Company Builders. And that not only in Germany. They are dedicated to their goal to become the world’s larget internet platform outside of the US and China. Going by their media presence, they are almost unbeatable. No week goes by where they don’t make headlines in the business section of any news site. Even if these headlines aren’t always positive.
Everything started in 2007, when brothers Marc, Oliver and Alexander Samwer founded Rocket Internet. Before that, they were successful with online auction site Alando and ringtone seller Jamba. They sold both companies with a profit which they invested in startups like Zalando and Rocket.
From all of the brothers, only Oliver is still with Rocket. The current company leadership is complemented by Alexander Kudlich who joined in 2011 and Peter Kimpel who switched from Goldman-Sachs in 2014 – the same year the company went public. With mixed results: initially, shares were traded for 37 Euros and rose to 50 Euros but since July 2016 the price has fallen well below 20 Euros.
The reason for that development might also be Rocket Internet’s business model. Their companies are meant to grow big as quickly as possible. Which is why they receive a lot of funding. Profits come later – if at all. In 2015, this model lead to loss of around 200 million Euros.
At least, Rocket Internet cannot be accused of being idle. Besides core sectors food and home delivery (e.g., HelloFresh, Foodpanda), fashion (Zalora, Jabong and others), trade (Lazada, Jumia) and living (Westwing and home24), the Company Builder from Berlin repeatedly tries to get a foothold in other sectors. Most recently, Rocket also invested into sectors fintech and health.
Worldwide Activities – Successful or Not
Most of Rocket Internet’s startups are barely known in Germany. Which doesn’t come as a surprise – at the end of 2015, they company was active in more than 110 countries and employed more than 36.000 people. They are often accused of being a copycat company with barely an original idea of their own. Also, Oliver Samwer is not said to be the most likeable of persons.
There’s another group of people who say that Berlin would never have become the German startup capital without Rocket Internet. The company has a reputation of churning out talented entrepreneurs: the people who come out the other side know what’s most important when launching a company. And which mistakes should be avoided. Seen from that angle, Rocket Internet is a truly special kind of Company Builder.
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