Nick Depperschmidt, Director of Content
In the United States, Silicon Valley is the hub for all things IoT. From Google, Apple, Oracle and Intel, to all the small and medium sized start-ups, the Bay Area is the place to innovate. It has become a knowledge base of young, educated individuals looking to push boundaries into the digital future. There is no other place like it in the world. Or is there?
Fueled by government financial backing, education, and research & development centers, Bavaria – and specifically Munich – has staked their claim as the Silicon Valley of not just Germany, but the whole of Europe. Bavaria alone has a GDP of 522 billion euros, putting it ahead of 21 of the 28 European Union member states. It is home to several high technology companies such as IBM, Google, Huawei, BMW, Audi, Amazon and Microsoft and 60 percent of the country’s patent applications originate within 30 minutes of Munich.
The move to digitalization was a natural progression as Bavaria has a deep tradition in industrial and automotive manufacturing, as well as textiles. Working to improve their own processes, companies in the region have moved to smart factory production and started Industry 4.0/Industrial IoT initiatives.
Constant German innovation in engineering and manufacturing should be of no surprise. For those of us working in the IoT sector, Industry 4.0 is a commonplace term and many German companies have made great strides in the area. However, what isn’t so commonplace in Bavaria is how the State is supporting small to medium sized technology enterprises (SMEs) and start-ups in the region.
The State of Bavaria works closely with universities in the region to seek out promising projects and will co-invest up to 50 percent of the startup capital for new companies in the tech sector. Much of the ground work in this area starts of the Center for Digitalization Bavaria. (Zentrum Digitalisierung Bayern) There they foster cooperation with universities and support established SMEs in a constant effort to spur more research & product development in the smart products space. In the next five years the center plans to fund 2 billion euros for startups, with of the funding going to education and going into hardware infrastructure.
Education is the key for the Center. Startup Manager Manuela Schauer oversees the mission to bring about more, and better, startups to success. Students at the center work with mentors to develop their business plans and IoT solutions through apprenticeships and receive entrepreneurial education throughout the process. Those in the program also have access to innovation labs within the center to work on hardware and software development with the latest technology. This speeds up research from the universities and lessens the steps for young Germans to take their ideas and turn them into profitable businesses.
The Bavaria and the Center of Digitalization also caters to SMEs, which are vital to the economy of the State. Known as Mittelstand these SMEs are technology driven and operate in line with the traditional German taste for inventing and tinkering. The center supports established companies with their own digital transformation. Within the usually small, internal structures of these companies, numerous employees work in various disciplines and are directly involved in the innovation processes. Allowing the Mittelstand to produce creative products and services more quickly then their large corporate counterparts.
Its not all about funding though. The Center for Digitalization and the folks at Invest in Bavaria also actively attend and host networking events for those in the tech business, research & development, politics and higher education to help advance the discussion on what Industry 4.0 and IoT will become in the years to come.
The staff at IoT Today attended one such event call The Year of the Monkey in Munich. Unlike the sometimes stuffy trade shows, the event was primarily attended by 20-something entrepreneurs looking to learn how to transform businesses and people into the digital era. At the event there were drones flying around, VR glasses, fortune tellers, and a spirit of collaboration over simply selling products.
The topics were familiar: Big Data, prototyping and developing, cyber security, wearbales, IoT Ecosystems, and so on. However, the networking at the event was unmatched. Even the folks in the Silicon Valley could take some pointers. Laid back and casual, innovative ideas were shared and new businesses were likely started over some BBQ.
So when you’re looking for the best new company to partner with or invest in, they may not be located in Menlo Park or Santa Clara. You may need to book a flight to Munich International and see the great things they’re doing in Bavaria.