Recently, our CEO Martin Klimscha had an amazing interview with the Austrian start-up platform “Brutkasten”. Below you find the translation that gave us tons of answers. You can find the original interview in German right over here.
Der Brutkasten: Do you think the deal was positive or are you also a little bit nostalgic?
Absolutely positive. We have been a startup with a high need of capital and we were reaching a limit for a long time. After three years, we were confronted with the decision to either do a huge funding round to withstand the increasing market pressure, or sell. The possibility for the exit appeared just at the right time.
“We have a pretty complementary fit. We are giving them something they don’t have and vice versa.”
You cannot lean back and relax with that yet?
The good thing is that we can still continue things our way. Azubu is an active competitor in the video game livestreaming industry and that’s also the reason why we chose them as a buyer. We have a pretty complementary fit. We are giving them something they don’t have and vice-versa. For us, it’s business as usual, but on a wider spectrum. In this sense: We don’t want to lean back in any way, but rather rev it up and take on the industry giants.
This means that your tasks of the common company have already been decided during the negotiations?
Basically nothing much will actually change because Hitbox will continue as the combined company’s platform. Surely there will be some changes: We will rebrand and create a mutual new website but the core technology will be our technology. In other words: Our employees will run that platform. The Viennese office will stay as the European headquarters.
Will both brands continue existing in parallel?
To be able to use both synergies, we need to reduce everything to one platform and give it a new optical look. Some new features will be there as well.
Will it be a whole new brand or will it run under the name of Azubu?
The plan is to create a new brand with a new name. Unfortunately, I cannot say more about it yet.
The whole process started in spring 2016. Azubu contacted you. What happened exactly?
We started talking with them two years ago. Back then it was all about cooperation and how we could fight the market leader together and not against each other. That didn’t work out and we competed hard. In spring 2016, Azubu contacted us again. This time the topic was M&A.
There have been some changes within Azubu. This was the time when we saw that our values and goals matched. Nevertheless, it has been a challenging process for us because Azubu was a competitor. We only were able to give limited due diligence as we couldn’t give out all our data. But we had to give them what they needed to know so that they have an understanding of our business and potential.
Your former investors were part of the negotiations. Did that help you?
Yes. We went through a lot with Speedinvest and our other investors. In this context I really want to thank Oliver Holle and the Speedinvest team. We went through many ups and downs together and grew together. Not only was it an incredible achievement from the founder team and staff but also from the investors. They were always behind us and supported us in the best possible way.
Does that mean that if you would fund with a new idea, Speedinvest would be your desired partner again?
The way the startup scene in Austria is developing it would actually be an option to start something in Austria again, but if I were able to time travel: One of our biggest obstacles in the past was the Austrian location. It was quite hard to get the investment that we needed in Austria or as an Austrian company. The startup mentality is improving though and also the government grants are increasing.
With Speedinvest we had a really trustworthy and supporting partner, along with our other investors. We have had great business angels like Michael Altrichter, Fritz Berger, Lukas Püspök, Florian Aichinger and many more that supported us in tough times.
What is your advice to young founders? What’s the most important thing you’ve learned?
What people might not know is that our CTO René actually started this business five years ago. He was building his first startup and virtually launched the eSports market through livestreaming.
Absolutely crucial in such a project is the team. Everyone that starts working in a startup has to know that it is not an easy job, but one that brings unusual work hours and requires huge effort. The most important thing was to find a great founder team that trusts and complements each other. After that we used a lot of time to get the right members for our team and to make our idea their thing. We certainly made some mistakes but we tried to learn from them and to not make them again. All in all I guess we have done more things right than wrong. This lead to success and we are really proud of that!