Investing €20,000 into two start-ups,
Start-ups are hindered in their
development by a lack of access to capital and expertise, while large companies
face the challenges of established processes and little space for error owing
to the expectations of the customer base. In partnership, start-ups and large
companies can benefit from each other’s strengths. We are seeking to invest in at
least two start-ups.
Eesti Telekom is willing to contribute to start-ups. Are start-ups ready
to contribute to Eesti Telekom?
A reliable brand is both a strength and a weakness. On the one hand, a
strong brand is essential to profitable business on a competitive market. On
the other hand, strong brands such as EMT and Elion cannot afford failures of
new trials, as customer expectations are high and disappointment would lead them
to use the services of competitors.
Furthermore, innovation in large companies on small markets is limited
by the market size, as product development costs might not be recovered. This
is why Eesti Telekom cannot focus on the development of niche products, as our
domestic market is limited to Estonia, which does not allow niche values to be
converted into money.
Start-ups, on the other hand, should specifically focus on the
development of globally expandable products. Start-ups can afford to fail, as
the best value for the customer is achieved through trial and error.
To create mutual benefit, Eesti Telekom launched the
VUNK accelerator, through which we will invest in start-ups. We regard this as a way to strengthen others, while also benefitting
ourselves. As we focus on serving customers in Estonia, we are seeking a
partnership to boost global businesses whose value would be returned to our
customers in Estonia.
We will grant €10,000 to two
When planning the partnership model, we debated whether we want a
holding in return for the seed capital. The simple consideration of “perhaps
they will succeed?” spoke in favour of having a holding, while the concern that
start-ups might thus wither in our corporation without creating any value for
either party spoke against it.
A decision was ultimately reached to grant the seed capital and a mentoring
programme without asking anything tangible in return. We will not require a
holding in the start-ups that receive our grant of €10,000 (per start-up) and a one-month
What is our benefit, then? Through our contribution, we intend to learn
from the bright and innovative leaders of start-ups and to introduce the
start-up mentality at Eesti Telekom. Mentoring will provide guidance to the start-up
leaders and, with the speed and ambition of the start-ups, we also want to
bring added value to our common customers.
A monetary grant with a mentoring programme will be granted to two
teams, while partnership with others is not precluded. After the accelerator
programme, which will identify the actual business model and ambitions of the
start-up, we can jointly discuss whether we will enter the market and what
partnership model we will use. The choice can only be based on the common
interests and valued contributions of both parties.
If the start-up is independent and Eesti Telekom will not play a
considerable role in the success of the new business, it can go on and conquer
the world completely independently. Eesti Telekom will not require the
repayment of the seed capital. As we cooperate with the Estonian business angels
network and other incubators and accelerators, we can refer start-ups to our
partners for further development and the involvement of investors.
Through the thorns to the stars
The main programme of our VUNK accelerator for start-ups will be
launched at the end of August, while teams contact us also outside the
incubator. A good example is the Autlo automatic parking solution, for which
the leader of the start-up Kristjan Konks paid a number of visits to Telekom to
pitch his idea, only to be rejected due to a lack of a feasible technical
solution and business model. His faith in the success of his idea and
persistence in bringing it to the market led him to repeatedly test, develop
and reshape his idea. This is how he reached a solution that is now being
offered to customers on a limited scale and improved based on their feedback.
Such a mentality is essential to the success of a start-up, especially in
the early stages, when the scale and potential of the concept is still unknown.
Learning from mistakes, constant changes and boundless faith in one’s idea are
the greatest values when launching a business. This is also noted by investors
and potential partners, and is, in fact, often the basis for decisions. Competence
can be involved and developed, but the passion has to be there.
Garage48 Telecom development weekend will be held on 28-30 August, followed by the
accelerator programme. We are expecting 120 participants. Find out more and
register at vunk.eu.
to the two teams participating in the VUNK Accelerator programme today, quite a
few teams who did not manage to set up their team during the hackathon weekend
in August have independently developing their idea future.
For example Career3, a team from Eesti Telekom, was not able to find developers at a right time, but the energy of the authors of the idea has not run out – quite the opposite.
In an alphabetical order get to know #GetVunked2015 team No. Seven - Tippy & team lead Marek Fraczyk. They are about to change the world of tipping & giving feedback for service you get in a bar, pub or restaurant - so no more awkward feeling when you realize the service has been superb but you cannot show it. Plus team motto - we just do it. Read more »