How BMW empowers startups

Startups Magazine Deputy Editor, Anna Wood, attended MOVE, the tech mobility and startups show. Alongside all the exciting products on display, and the many interesting startups the team had the pleasure of speaking to, was the highly anticipated conference agenda.

One of these fascinating talks was by Toni Plöchl, Startup Manager R&D of BMW Startup Garage, where he discussed “Venture Clienting: How BMW collaborates with start-ups to become digital, electric, and circular.”

BMW Startups Garage is a Venture Client unit for early-stage startups for the BMW Group. The company focuses on validating their prototypes, helping them learn about the automotive industry and connecting them with decision makers for business development. For that, the startups work directly with BMW engineers and managers on real innovation projects. BMW Startups Garage don’t only work with automotive startups, in fact, they claim that some of its most interesting innovations were sparked in other industries.

BMW Startup Garage is essentially the matchmaker between exciting startup products and the engineers and experts working on new models of BMW vehicles. Explaining one of the benefits of this model, Plöchl stated “it’s a win-win because we get early access to great innovation, the startup keeps all IP rights but they have a very big client like BMW Group, that of course can make a difference in further transactions and sales that they are trying to complete.”

Plöchl discussed how there are six key success factors that BMW Startups Garage has learned from the six years it has been in existence. The first success factor is providing the startups with access to know-how and infrastructure. So, they work with the startups and the engineering departments together to aid a relationship and improve the possibility of a successful collaboration. Another step is to include series development early on in the process. It’s important that before they begin working together, the startup has a working prototype, so if the product is of interest, things will be able to be put into motion faster.

Furthermore, Plöchl warned not to forget the internal market of the company. At BMW Startup Garage, they often hold events presenting what they’re doing, and the types of startups they’re working with, to make the entire company aware of what they’re working on and spark interest and further ideas for how technologies could be applied, as well as for the wider company to decide whether a startup is the correct business to be collaborating with. Co/financing can make a huge difference on both sides of the transaction. BMW will often pay for 50% of the product before it is received, and then the rest once work has been completed, which allows the startups to have money up front to create the amount of product that are required from them. A big factor that BMW have to consider is the impact that the startups they work with will have on them. They want to work with startups that will have a big impact, whether that’s by using completely state-of-the-art technology, or significantly improving the sustainability and carbon footprint of a vehicle; in summary they are looking for startups with an “important solution.”

And of course, the final success factor is ensuring to get top management involved early on. When a member of the team that is in an executive position believes in a startup or can see the impact that it will have on the entire company, it is a lot easier for it to work top down instead of bottom up.

In the six years that BMW Startup Garage has been operating, it has successfully worked with over 160 startups, and more than 50% are being followed up with further purchasing. BMW Startup Garage aim to create long-term partnerships, rather than one-off purchasing.