Blockchain innovation: the future within one's reach
The accelerator program of our partner BLOCKROCKET was founded in early 2019 by a group of FinTech veterans and high-net-worth individuals with the goal of investing in promising startups from the blockchain environment at an early stage. BLOCKROCKET accompanies startups in its program for up to two years and helps partners in its own network to recognize and apply the potential of blockchain technology.
"5-HT has been with us since our inception," says Sagar Barvaliya, Head of Venture Development. Now he tells us how 5-HT has been able to support them on their journey so far.
According to experts, blockchain will revolutionize our world more than the invention of the Internet. What exactly are you dealing with in this context?
"We focus our investments exclusively on startups within the blockchain space," Sagar said. "These are all those that use technologies in the form of an open and decentralized database or operate in an ecosystem relevant to it." He continues, "In principle, startups from all over the world can apply for our Accelerator Program. Since blockchain has applications in so many different areas, we don't want to limit ourselves to a specific market segment yet. That's why we open up to global startups, but can support them especially within the German ecosystem."
Wherever transparency and traceability is required, it makes sense to think about blockchain models.
You start financing startups through your accelerator program. What exactly are the processes involved?
"Our program has a duration of 24 months. During this time, we support startups in basic areas such as product building, networking, marketing as well as League Audition. A startup that is actively seeking funding can apply for this directly on our website. There, it fills out an initial questionnaire at the beginning, which then initiates a multi-stage application process."
We invest up to EUR 250,000 in early-stage startups, focus pre-seed and seed.
"Ultimately, we support startups in almost every area. From legal issues, HR, fundraising, marketing to website design - we take care of it. By providing this support in a wide variety of areas, we get our startups to their goals even faster. And their success is ultimately ours," Sagar emphasizes.
This strategy proved successful when you were building your startup. Have you changed anything now, three years after founding? In the strategy as well as in the team?
"Our team has grown, so our previous strategy has proven to be successful. We also currently have collaborations with over 250 partners, of which we count more than thirty venture capital investors in our network. We are enormously proud of this, as well as the fact of having made successful startup investments in the past six months."
So far, everything has sounded great, but have there been any setbacks in the past?
"Well, the whole world is trying to cope with the COVID-19 pandemic. Of course, that was also a challenge for us at the beginning. But we've used this time to move our operations completely to an online format and to work hard on our initial investments."
BLOCKROCKET came out of the crisis even stronger.
"In times of lockdown, we have made a total of five investments. We plan to make another five to ten investments by the end of 2021. In addition, digitization in Germany experienced more momentum last year than in the last two decades. From that perspective, the crisis had more positive than negative sides for our business."
It's understandable to be proud. What else do you have to pat yourselves on the back about?
"Well, when it comes to blockchain ecosystems, we are currently the leading startup accelerator and investor in Germany. The many applications we receive every month regularly confirm this. Knowing you are the right place for innovation is motivating.
Of course, we know that the startup market always brings uncertainties with it. But we intend for the next five years to be even better positioned with our on-funds to be able to invest in far more startups at the same time. In doing so, we also want to expand our startup acceleration program."
BLOCKROCKET: a startup that mentors startups. Do you have any advice for founders?
"The most important aspect is definitely to listen properly. Firstly, with the customers, because here companies should learn not only to know their problems, but also to really understand them. Because only when the core problem has been identified, the implementation of the idea into the real world, is easier." Sagar cites the product-market fit phase as a keyword here.
He also describes the challenge many founders face as follows: "In general, a startup should present its elevator pitch in such a way that even a 15-year-old child can understand it after just 60 seconds and understand what problem it is trying to solve. Because that ultimately makes it easier to find a solution," Sagar adds.
"On the other hand, founders should also communicate properly with each other internally, because it is a hindrance to "work past" each other. Rather, there needs to be open discussion and clarity about who is making what contribution and where the path should lead." Finally, Sagar emphasizes the importance of regularly conducting a critical reality check of one's own idea.
Getting criticism for my product is the best opportunity to make it even more profitable.
This approach is foreign to many founders, because most are too optimistic when it comes to their own projects. But constant self-reflection facilitates positive product development, as well as a successful market entry.
"Heaven is limitless, we just have to ask each other.
Especially because we at BLOCKROCKET do not focus on one market segment, we particularly appreciate the cooperation with 5-HT as a strong partner. Due to their focus on the chemical and healthcare industry, our startups, which are active in precisely this area, benefit the most.
Apart from that, 5-HT not only cooperates with many well-known companies, but also has a developed mentor network. These two aspects help BLOCKROCKET and our startups to get contacts in the industry as well as specialist and industry-specific expert opinions.
In this respect, we are excited to see where the future collaboration with 5-HT, will also take us."
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