Europe is catching up on start-ups thriving on digitization
Introducing "Tenzing" - a consultancy for start-ups
- Start-ups are hot. And everybody these days wants to bask in their glory and share in their success. We at Roland Berger are no different – except we are. We have been supporting start-ups for 25 years, pro bono.
Now, we have devised a way to make the full range of Roland Berger support available and affordable to more start-up and scale-up ventures as part of a long-term relationship. Leaving the glory and the returns to the entrepreneur, we are the ones that share her burden and help her reach the top. As a Sherpa does a mountaineer. Introducing Roland Berger Tenzing.
Hype or not, start-ups matter. They are both engines of economic growth and creative destruction. They have the potential to create jobs and reinvigorate economies; disrupt industries and find new answers to the challenges of today and tomorrow; and offer inspiration and opportunities for investment.
In short, we need more start-up entrepreneurs and we need to help them grow and become successful.
Now, we noticed a couple of things. For starters, there is clearly no lack of money. Every year, many hundreds of millions of euros are made available in the Netherlands alone – by (corporate) venture capital, regional development funds, (technology) seed funds, university holdings, angel investors and so on. There is no shortage of good ideas either.
There are thousands of active start-ups and tech companies in the Netherlands today, and hundreds more are launched every year. And yet fund managers struggle to invest, while only a few start-ups make it big. The reason is that there are too few high-quality business propositions that can attract the right investment at the right conditions.
Every venture faces three big questions
It has become fashionable to dismiss the idea that (new) ventures need a plan. In many respects the critics are right: the longer one plans, the longer one waits to meet customers in the market, perfect ones proposition and generate business; and no plan survives first contact with market reality. But preparing does not mean procrastinating, and being flexible is not the same as being clueless. Each entrepreneur needs a plan to think through the three big questions that face every (new) venture:
- Who will buy this?
- How will I make money from it?
- What do I need to do to get from where I am today to paying customers and scalable operations?
To quote Antoine de Saint-Exupéry: A goal without a plan is just a wish.
Hot young start-ups are never short of friends. Incubators will offer office space and interaction with other start-ups. Business angels will offer pointers and cash to cover initial costs. Former CEOs will offer to take over and lead the business. And investors will offer a little cash for a lot of equity.
While much of this is useful, often that is not what starting entrepreneurs really need. Rather than (just) facilities, money or advice, entrepreneurs need someone who will actually sit down with them to do the work, challenge and improve their business model, write a convincing plan and build their business. Someone who will be with them, every step of the way, and all the way to the top.
That’s us. We help established companies define and realize their strategies every day. We have also been helping young entrepreneurs write their plans and build their businesses for over 25 years. We helped found YES!Delft, one of the most successful Dutch start-up incubators (ranked #4 in Europe in the 2015 UBI-rankings) and supported companies like Ampelmann, Senz Umbrellas and Eternal Sun – to name but a few. But as we have always given our support pro bono, we have also been limited in the number of ventures we could support – until now.
"Venturing is like scaling Everest: an expedition to reach the top with challenging stages between winning idea and business success."
We have devised a new approach that allows more start-ups to benefit from a long-term relationship with Roland Berger. It makes our services affordable by allowing us to share the start-up's risk. We offer the hands-on support of a top-tier strategy consulting firm, our expertise in markets, business and strategy, our brand and network and years of experience supporting start-ups. We help start-up entrepreneurs scale their personal Everest, all the way from “base camp” to summit and business success.
To do so, we assign "Sherpas": seasoned professionals with an affinity for ventures and entrepreneurs and full access to Roland Berger’s network and resources. We have drawn inspiration from and named our offering after Tenzing Norgay, the Sherpa who brought the first man to the top of Mount Everest. While the glory was Edmund Hillary’s, the journey was accomplished with the unrelenting dedication of Tenzing. Similarly, Roland Berger Tenzing and its Sherpas will support start-ups at every stage of their journey to success – without stealing their thunder or taking a fat slice of their equity.
We are flexible in our arrangements, but the core is this: we ask for a small cash fee to cover expenses and a small stake in the company that will only have value after the venture clears a pre-agreed hurdle. Plainly put: only if a start-up becomes a big success will it share a little with us. We are comfortable sharing risk in this manner, because we are convinced that our support will make a start-up a more likely, quicker and greater success.
Tenzing is part of a growing portfolio of Roland Berger services that go beyond traditional strategy consulting. Our digital business platform Terra Numerata brings together incubators, investors, technology providers and digital players of different sizes from different segments to help them form alliances and push digital innovation. It leans more towards existing companies, digital and partnering. Tenzing focuses more on start-ups, technology and hands-on support.
Both will do whatever is necessary to make those we work with successful. And both already boast satisfied customers: one example is a new car-sharing service using only electric vehicles to provide social, sustainable and safe mobility that is more convenient than public transport and cheaper than taxi services (incl. Uber). Another is a Dutch MedTech start-up that Tenzing helped upgrade its business plan, business model and roll-out strategy to close financing and enter into discussions with a strategic partner.
Start me up
Roland Berger Tenzing focuses on assisting ventures with scalable business models and the potential for profitable growth. We enjoy working with entrepreneurs who want to grow their business rather than just its valuation in anticipation of an exit. So if an entrepreneur is committed to having her start-up reach the summit, she should invite us along – we will be a trusted and devoted "Sherpa" all the way.
- Photos: Georgijevic / iStockphoto; SergeOstroverhoff / Getty Images, Thinkstock; -striz- / iStockphoto; Roland Berger; John Lund / Getty Images; pixdelux / iStockphoto; merrymoonmary / iStockphoto; slidezero_com / iStockphoto