Chemovator opening to external startups: What happens now?

By Alisson Peña in an interview with Markus Bold

Whether it is inside BASF or outside in the entrepreneurial world, at Chemovator we know there is potential for many great ideas to reach their full potential. We announced the opening of our incubation program Chemovator – Elevate to external startups and are very excited about this new chapter together! This is a huge step that surely might come with some questions, so we asked everything you need to know to the one who has been there since the start of it all, our Head of Chemovator, Markus Bold.

Markus, why did Chemovator decide to open for external startups?

Markus: In order to solve the big challenges of today, Chemovator needs the best ideas for chemistry from within BASF and from external. Therefore, the engagement with external startups is a must – so it is rather the question, why have we not done it earlier?

To establish the business incubation approach for BASF, Chemovator has picked the intrapreneurship path as first option. From day one, an opening was part of our game plan - simply due to the fact, that Chemovator alone, despite being a proud part of BASF, the leading chemical company, can only address the big challenges of our times in cooperation with other smart people and organizations. Now, with all our learnings entrenched in the current Chemovator organization, we are ready to take the next steps: engaging with external startups in the pre-seed stage. This further enriches BASF’s way towards innovation in close collaboration with the chemical ecosystem.

Are you continuing to offer support to corporate BASF employees as well?

Markus: Of course! Since our foundation, three ventures have been reintegrated into BASF, five companies have been spun-off, and more companies are in preparation for spin-off. I am amazed by which kind of ideas are showing up at our Entry Pitches, reflecting the depths and breadth of BASF activities. I firmly believe that there is more potential in BASF which can lead to innovative and attractive companies – our steady deal flow from the BASF world demonstrates this.

What differentiates Chemovator from other incubation programs?

Markus: Chemovator delivers on its promise, we have done so in the past, and with all confidence, we will do it again. Chemovator is designed to host startups associated with the chemical industry, backed by the largest chemical company on this planet.

Each organization is different, BASF, as the mother organization to Chemovator, has its own culture, history, rules, and experiences – and all of that has effects on Chemovator.

Furthermore, we as an organization serve the needs of founders meeting the expectations of their investors as a guiding principle. This clarity enables us to design all our processes at Chemovator according to this target.

Our results speak for themselves, we have completed quite some spin-offs, financing rounds, and our first venture has just gone through a subsequent financing round.

What is your selection process for startups and how do you evaluate their potential for success? Do they have to be linked to the chemical industry?

Markus: We only invest in startups that have the potential to shape the chemical industry of tomorrow. Topics like circularity, carbon management, renewable resources, new material for batteries, efficiency in production – just to name a few - are fields, which have the potential to lay a foundation for our future chemical industry.

Further down the line, team, the relevance of a problem, the solution to the problem, unit economics, and protection of the business model – among others – are further criteria for putting down money and our time on such a case.

What is the selection board and who is part of it?

Markus: The selection board consists of some Chemovator staff members, some experienced entrepreneurs from the Chemovator network (we call those Entrepreneurs in Residence, EiRs), and potentially other external (corporate) players, depending on the nature of the startup.

How long is the program and what milestones should be achieved during this period?

Markus: We are not using time as a steering mechanism, but rather money. In all its simplicity, elevating a pre-seed startup to a seed financing round (or whichever round is next) is our target north star. The milestones in between are highly dependent on the nature of the startup, might be team, might be operations, might be product….

What kind of support and resources can a startup expect to receive when making it into Chemovator - Elevate?

Markus: First, a startup receives an investment of 200k seed investment. By no means it is in Chemovator’s interest to control a startup, we will act as a minority investor.

Second, a startup receives access to the BASF world, and Chemovator will facilitate the interaction with BASF, which could otherwise be overwhelming.

Thirdly, we do not restrict it to BASF only, other corporate partners have shown sustained interest to interact with the program. This follows the principle of an open architecture of the program.

Fourthly, startups will get access to resources, which early-stage startups need to reach the next level. This is a tailored entrepreneurship program, mentoring through experienced entrepreneurs and access to the full experience of the Chemovator team like IP, HR, marketing, legal, operations, tax, finance, controlling, ….

Fifthly, BASF could play a role further down the road, either as a customer, as a follow-up investor, or even – in a longer perspective – as an exit option.

How do you balance the needs of multiple startups at Chemovator, and what strategies do you use to ensure that each one receives the attention and resources it needs?

Markus: Our places in Chemovator are limited as we want to ensure that each member of the program gets the attention it needs. Each startup will have a dedicated mentoring resource, each startup will have a board that will serve as your strategic sparring partner to drive the growth of your company.

Further we intend only to invest in cases, where we find interested BASF colleagues, interested in you and your solution.

How do you help startups connect with investors, and what role do you play in facilitating these relationships?

Markus: In our first 5 years of existence, we have interacted with many investors, and this network is still growing. We have negotiated term sheets and shareholding contracts with VCs, CVCs, business angels, family offices, and corporates.

And we at Chemovator internally and externally, as part of our ecosystem, are available to work with you in your specific situation. As a minority shareholder, we have a dedicated interest to put your startup in a position to flourish.

So, interested yet? Find more information here or directly pitch to us here.

Comments (0)

Create comments