There's a new venture capital firm in town. BMW i Ventures, a $100 million fund that BMW based in New York, will be an incubator for developing technologies and mobility services for urban transportation and navigation. It is also allied with BMW's biggest brand extension to date, BMW i, comprising a range of new electric, hybrid and other alternative vehicles and "sustainable, premium mobility" solutions.
Although the fund doesn't have a pied-à-terre in the Big Apple yet, it does have its first startup, "My City Way," a set of location-aware apps for urban navigation. The startup won this year's "BigApps 2.0" event, of which BMW is founding partner. BMW i Ventures will offer space in its incubator to two or three of the winners.
Joerg Reimann, BMW i Ventures managing director and VP of strategy and target management at BMW Group, was in town last week for the awards show, along with Dr. Bernhard Blaettel, BMW director of project mobility services, and Alexander Diehl, who is consulting on the project. The trio spoke with Marketing Daily about BMW i Ventures goals.
Q: Have you found a location yet for BMW i Ventures in New York?
JR: We are still in the process of location scouting and then we will finalize in the coming weeks. We are close but haven't closed yet.
Q: Broadly speaking, are you concerned solely with car-independent technologies as startup ventures at this point, or are you also looking at car-related or car-dependent technologies?
JR: We are starting with the BMW i sub-brand positioned as a provider of mobility solutions, so it is both cars and mobility-independent services. We set up BMW i Ventures to make a clear stand for services that are really independent of the car, but it really starts with the consumer: what are their mobility needs in general, be it car or non-car? This is probably an unconventional approach for a carmaker but we are starting to think about the holistic needs of the consumer around mobility. That does not mean necessarily that there won't ever be a connection with the car, because it is the most logical thing that these services, where appropriate, would migrate into car technology. But the starting point is the consumer.
Q: But is the goal to ultimately incorporate these startup technologies into BMW's own product portfolio or for BMW to stay a partner in a portfolio of independent businesses?
JR: It will be a case-by-case decision. By end of the day, we will have a portfolio of services -- some of which might be used in the car, but the majority for mobile services that can be used primarily out of the car -- with mobile devices, for example. Partnership by partnership, we will then decide whether to migrate, integrate or duplicate this inside the car. But it's a case-by-case decision. The aim is not to turn this into a BMW-branded service.
BB: Let me give you an example where we see a great connection between "non-car" and car-related services: we just announced that we will start a car-sharing enterprise in Europe, and we will also think about doing this in the U.S. The cars we have in Europe for car sharing will be our Mini and BMW products. But at the same time you will eventually find in these cars the MyCityWay application for navigation and information about places, opinions and offers around different cities. That's an example of how, at first glance, non-car-related services can be part of a combined package with car-related services.
Q: How are you deciding between different startups to invest in, and are you looking at now other companies beyond MyCityWay?
JR: It has to be linked to mobility needs from consumers. When we analyze them we ask what the profit potential is, what's the fit to our strategy, who are the consumers for whom those services might be relevant, what is the approach, and does it fit into the overall portfolio of services we want to build?
AD: We are looking at around 150 startups, and if something seems interesting, we move forward and eventually start going into a closer discussion with potential candidates.
Q: How are you putting your ear to the ground on who is doing what?
AD: There are a variety of channels. One major thing is to be part of the technology community, which is also in some sense global. Really, it's about following different trends and hearing who is doing what. You come across people who may have interesting ideas, or you reach out to your network and ask who might be doing that now. And there are more formal platforms, which is why we decided to do a strategic partnership with BigApp. Specifically, within the New York tech scene, a lot of people will come to that event and will meet around it. And there are New York technology "meetups" every month.
Q: Why is BMW i Ventures based in New York?
JR: Having decided to go in this direction, we were aware we had to make a bold step. And for us that means stepping into an arena where most of the investment is getting accumulated. That's why we said we had to move out of Europe and set up the venture in New York -- a worldwide hub, where we can manage initial investments and where most know-how is aggregated, particularly with New York as a media capital. Also it's not only about location, but whom to work with. Alex Diehl comes out of the media arena and he has that expertise.