Starting as a tech start-up that aimed to automate the development of MVPs to a leading service provider in corporate venture building and digital product design: Since 2017, MVP Factory has been enabling companies to implement their digital transformation and products at start-up speed and has transformed its business along the way. At the end of June 2023, the company joined forces with Ness Digital Engineering (Ness).
We talked to Philipp Petrescu, Founder and Managing Director, and Johannes Simon, Managing Partner about this transition. In this interview, they answer the following questions and more:
- How does the future look for MVP Factory after joining forces with Ness Digital Engineering?
- With the rise of new technologies like AI, how is MVPF incorporating it into the innovation processes?
- What are the advantages of a venture studio model, and what are some of the important success factors?
Marie: Philipp, take us on your journey - what convinced you to join forces with Ness Digital Engineering?
Philipp: Three decisive reasons convinced me. Firstly, we have been actively operating in the German-speaking market. Ness offers us a broad network of contacts in the international arena - so we can internationalize even faster and more successfully. Secondly, I was impressed by Ness' strong tech excellence. We often worked with freelancers for the implementation part - with Ness, we now have access to 4000 developers worldwide. This gives us a very strong partner that allows us to not only build MVPs but also provide deeper technical value to our clients. Last but not least: For our clients, the biggest impact often lies in properly modernizing their core systems - and sometimes that’s even a prerequisite for successful venture building. Together we can tackle this and build a globally leading platform for digital transformation and innovation.
Marie: Johannes, how will the acquisition affect ongoing customer projects and what can our customers expect now?
Johannes: Nothing will change for our customers. We will still deliver the same quality, we will still offer the same services. Only one point has changed: due to the extended access to Ness’ resources, we will be able to accompany projects longer and handle projects of higher scope. We remain hands-on and execution driven, now combined with the strong product and tech expertise of Ness.
Marie: Philipp, you always emphasized that an idea alone is worth nothing - from your experience, why do companies find it so difficult to execute projects successfully?
Philipp: First of all, corporates want to maintain their value and optimize sales from existing products. What I have seen often in innovation projects in recent years is that many companies think too big and too theoretically. I have come across many examples where an idea has been thought about for years without even talking about it with customers or partners - pure slide fireworks, only theory, but nothing tested on the market. Our experience shows that user feedback is needed quickly and directly. With our latest venture Whatever.works, we managed to do just that - the idea came out of the Corporate Jobrad itself and we helped validate the business model and launch it on the market within five months.
Marie: Johannes, can you tell us a bit more about whatever.works, the latest MVPF Venture?
Johannes: It's a very strong example of strong implementation. Jobrad has thousands of customer relationships in the same departments that Whatever.works is operating in.
When they first approached us, the management only wanted to make the venture a success, without strategic influence that could hinder this goal. Today, the startup enables straightforward workations and remote work policies. The initial idea has now turned into an award-winning startup, making it the perfect example of successful end-to-end venture building.
But back to the initial question: Why don't companies get it executed? It's not their business. Managers are usually not hired to take bigger risks but to bring long-term stability to a company. Which is an art in itself. At MVP Factory, however, we look at ideas all day and know how to implement them successfully. We don't fall in love with ideas and we don't have a political or strategic agenda that clouds our judgment. So it makes perfect sense for corporates to get support in the area of innovation – an unbiased view from the outside by people who do only that is unbeatable.
Marie: Is Artificial Intelligence (AI) revolutionizing the innovation landscape? What opportunities does the collaboration with Ness offer about this cutting-edge technology?
Philipp: AI will have a massive impact on our entire economy, leading to big changes macroeconomically. How we live together as a society and collaborate professionally will completely change in the next 10 years. In terms of the innovation landscape, however, what matters in the end is successful execution. That's where AI can support and help us understand and penetrate markets faster. That being said, GenAI is not yet really capable of thinking outside the box. Nevertheless, artificial intelligence is the future and we are already working on specific customer projects today. Ness has in-house developers in this area who have already piloted their own AI models using open source. Together with Ness, we want to become a leading provider of AI so that customers can use it in a compliant and easy-to-use way in the enterprise.
Marie: How does that work out in concrete terms?
Johannes: In the future, there will be an even stronger focus on language models for companies, with the databases residing with the companies themselves - from HR to legal. Then AI can learn the "Tone of Voice" and the rules of the company. Be it creating contracts, writing content, or doing analytics.
In the upcoming years, this will be one of the big topics for us as well. Through the partnership of Ness and MVP Factory, we can conceptualize and build it. Our AI offerings will be similar to our Venture Studio model - tailored to your specific needs, secure, compliant, and with all the extensions you may need to enable massive efficiency gains within your company.
Marie: You mentioned the Venture Studio model. Together with DB Schenker, you have set up the first corporate venture studio model in Germany - what magic is behind this approach?
Philipp: The venture studio model itself is not new. Rocket Internet, Atlantic Labs, or Picus Capital established it in Germany. What makes us unique is that we don't have classical LPs in the background, but DB Schenker AG is an investor and partner. Through a venture studio with a corporate partner, startups can use their network, knowledge, and customers to successfully establish their companies. Our model is created to provide equal opportunities for both the corporate and the startups - the founders in our model have up to 80 percent of their shares, which is an incentive for them to become successful. In the end, all sides have a better deal and win.
Johannes: With DB Schenker's Venture Studio, we were able to set up a functioning, replicable, and effective process that is adapted to the needs of the corporate and the startups. The governance behind the studio makes sure that all parties only win if the startups win. Our secret sauce? There is no room for opportunism. In the daily workings, we look at the macro trends in the area of interest and populate them very early. This way, DB Schenker can help shape future developments in the market and get its shares early on or leverage the investments well and thus diversify. Especially in the current market situation, this is strategically very smart.
Marie: Everywhere you read about an economic downturn in Germany at the moment. Why should companies invest in innovation at all now?
Philipp: The new growth forecast of the International Monetary Fund shows this very clearly - Germany is in last place with minus 0.3 percent. It is not an easy market situation. According to the Ifo Institute, companies assess their current situation as miserable as it was last at lockdown times. But if you look at the startup market, startups founded after times of crisis are more promising on average. Budgets should be invested wisely right now. I can only advise everyone to continue to innovate. The customers we work with invest in innovation budgets because they know it will pay off in the long run.
Marie: Philipp, 7 years of MVP Factory have gone by. Customers keep talking about how unique the MVP Factory team is. What makes a good team and how did you manage to set it up?
Philipp: We have succeeded in something that is often not the case in the startup world: we live cross-functionality. On all projects, we use people from different backgrounds - from venture architects to product designers. Furthermore, it has always been extremely important to us that all opinions are equal and that everyone can contribute their opinion. As a service provider, we always set very high-quality criteria for our team. The company could certainly have grown faster if we had hired more people. But for us, quality outweighs quantity. Over the years, we have succeeded in building a diverse, opinionated, open, and very empathetic team – I am very proud of this.
Johannes: I would also add to that as a lead, I have three rules for setting up a good team. First: Knowledge is empowerment. Everyone should always get all the information they need to do a good job and nothing should be withheld. Second: There is no shortcut to experience: You have to put people in the right situations and let them make mistakes. And when mistakes happen, I take that on my shoulders as a lead. And third: Don't be an asshole. It doesn't do you any good to have people on your team who bring in 10 million euros but destroy the team spirit. It's very important to us that everyone understands – no one is better than anyone else here. Stay humble, be a team player, and be nice. A lot can be achieved together whilst still having fun doing it.
Marie: Okay, then a quick final question. What do you get up for in the morning?
Johannes: To interact with the team and work towards a common goal. I enjoy enabling teams, turning exciting ideas into reality, and making an impact with it - I'm here to help.
Marie: And you, Philipp?
Philipp: I want to make Germany more digital and in doing so, support our customers in creating new value through digitalization. And I believe that it is incredibly important not to be left behind in international competition. If we succeed with a few projects, we'll have done a good job.
Download "Translating product goals into business goals"
This was just a preview, you can unlock the whole content here. Enjoy!
.png)
.png)