Bringing product development to fruition | instagrid completes seed funding round
In 2018, Sebastian Berning and Andreas Sedlmayr made the leap into full-time entrepreneurship by founding instagrid. After a fabulous first year, full of excitement and countless challenges, our CODE_n SPACES resident achieved a key milestone, successfully closing its seed financing round in the seven-digit range. The team is now getting closer to turning its vision of emission-free energy for all mobile machinery into reality. We spoke to the co-founders to dig into their successful seed capital round and learn more about their upcoming plans.
Iulia: Hi Andreas, hi Sebastian, congratulations on closing your first financing round! Attracting investment for your startup is a huge milestone. Tell us a little bit about how you experienced the process of raising your first substantial funds.
instagrid: It was both a very intensive and, above all, an incredibly instructive chapter for instagrid. If you have never done anything like this before, you quickly underestimate the time and persistence it takes to raise money from venture-capitalists – it’s a full-time job for weeks and months. Looking back, we were thrown in a little early as the first investors even approached us when the company was barely founded. We did not have a solid strategy by then but were rather testing various markets and figuring out where to go from there. Another thing you should bear in mind as a startup doing hardware is that it usually takes a longer run for ROI compared to a pure software product. Finding investors who are willing to support that kind of business can be quite difficult. If we were in the same situation again today, we would certainly start later with raising our first substantial funds. It may sound absurd, but it’s true. It all improved when we not only had a solid go-to-market strategy but when we were also able to show first traction and the enormous potential of our technology. Once it started going, we found great investors and we could already benefit from their experience and network in the first couple of weeks.
Anyways, we got some valuable support and it was fun. Being part of the CODE_n family helped us a lot as there is such a strong network to investors all over Europe. It was very easy to approach anyone that we wanted to talk to.
Iulia: What stage is the company now? What are the next steps for instagrid?
instagrid: We currently spend lots of our time working together with our brand partners and tweaking our product based on customer feedback. As new application scenarios continue to emerge almost every week, we strongly focus on meeting the needs of the industries with the greatest potential for our solution. Another very important pillar is to build an experienced and efficient team right now. We are continuously in search of the right people – not only with excellent skills but also highly motivated to shape our startup story and growth.
Iulia: How will the money be used?
instagrid: After we have successfully built and validated our first prototypes, we will now use the funds to finalize product development and certification and to ultimately ramp up mass production.
Iulia: When do you currently plan to launch the first portable generator and what are the targeted sectors and geographical regions you’ll focus on?
instagrid: As a first step, we will sell our battery power supplies as white-label products through our partners’ existing distribution channels. We are initially focusing on the construction industry, professional landscaping, garden- and tree care, but we already have many more sectors in mind which we want to address in the near future. The widespread market launch is planned for the first half of 2020 in Germany, Austria, Switzerland and Scandinavia – also entering the market under our own brand through direct sales online.
Iulia: Looking back on 2018, what were your biggest achievements?
instagrid: In many aspects, it was a mind-blowing year. We were thrilled when our early prototypes stunned our industry partners as we demonstrated a small battery box running serious construction machinery right in front of their eyes. Some of these partners had even worked on similar products before but had given up before they met us. Similarly, we were really happy when our first OEM customers confirmed that they wanted to sell our product from the beginning of 2020. This was a strong confirmation of our vision of making work more efficient through a portable and easy-to-use power supply – seems like we’re on the right path, after all.
It’s this dynamic that drives us – you basically never know what’s down the road just a week from now. People who are passionate about something tend to boost each other, so our upmost priority right now is to grow a world-class team and to form a company culture that supports them. We started off with nothing but a vision a year ago and we are now watching it grow, driven through our early customers, our investors and, of course, the amazing people at instagrid.
Iulia: Thanks a lot for the interview and best of luck as you undergo this growth phase! We’re looking forward to reporting back soon on instagrid’s new accomplishments.