Oliver Samwer

Trying to Relaunch the Rocket

Oliver Samwer, chief executive officer of Rocket Internet SE, looks on during the company's annual general meeting in Berlin, Germany, on Tuesday, June 23, 2015. Once termed "poor but sexy" for its lack of industry but vibrant nightlife, Berlin is growing quicker than most other German states thanks to an expanding digital industry, a sector where jobs have increased 43 percent in the city since 2008. Photographer: Krisztian Bocsi/Bloomberg *** Local Caption *** Oliver Samwer
The only way is up.
  • Why it matters

    Why it matters

    It’s an open question whether any of Rocket Internet’s hundreds of investments in online startups will ever turn into profitable ventures.

  • Facts

    Facts

    • Rocket Internet is an incubator of online startups and is best known for helping to grow German online fashion retailer Zalando.
    • Once a European tech-sector darling, Rocket Internet has struggled since its 2014 IPO raised €1.4 billion.
    • The firm has faced plummeting share prices, departures by top-level managers and a shakeup on its supervisory board.
  • Audio

    Audio

  • Pdf

Rocket Internet’s Oliver Samwer is not exactly known for his overwhelming media presence. He gave Handelsblatt a rare interview just before the company floated in 2014, but since then, he has avoided being grilled by journalists, preferring instead to air his views from the safety of a podium at various conferences and presentations.

But the company has struggled since its high profile public listing, and Mr. Samwer has decided he needs to explain himself, not least to investors who have just ploughed another large chunk of money into his business.

The Samwer brothers Alexander, born in 1975, Oliver, born in 1973, and Marc, born in 1970, are considered to be Germany’s most successful – and somewhat controversial – Internet founders. The most active of the trio is Oliver, Rocket Internet’s chief executive.

The Berlin based startup incubator floated on the stock market at the close of 2014. The brothers jointly became billionaires following the public listing. Recently, Oliver Samwer has been forced to digest some bad news. The company’s share price has been faltering, the initial public offering of its online grocery service, Hello Fresh, was postponed and an alternative is not in sight. Moreover, a number of long-time employees have left the company, and the chairman of the supervisory board has also left. Mr. Samwer sat down with Handelsblatt to explain what exactly is going on.

Handelsblatt: Mr. Samwer, you recently said there could never be an Elon Musk in Europe because nobody here would be willing to stick many billions of dollars into the dreams of one individual. Is the state of the risk culture here really that bad?

Oliver Samwer: I said there could be an Elon Musk in Europe, but he wouldn’t be able to find any financing. That’s probably so, because there is a certain aversion to risk that only a few in Germany overcome. When Musk started Tesla, his electric cars really weren’t much more than a dream. Nevertheless, unbelievably many investors followed him. There should be more of this willingness to take risks in Germany.

So far, his investors are only watching how Mr. Musk spends their money.

But in America they think differently. Even when Musk announces something extraordinary – like a train tunnel from LA to San Francisco – a lot still follow him. And even if we in Europe and also in Germany really do now have a couple of big venture capitalists, the situation is still not comparable to the culture in the U.S.

You are now starting a new fund with, initially, $420 million. Why exactly, since you most certainly have enough money through Rocket Internet’s IPO?

It is true that we still have some €1.7 billion ($1.86 billion) in cash on hand, but the fund can operate entirely differently.

How?

When we start new companies, historically we have always brought co-investors on board for individual projects, but did it in very time-consuming, individual rounds of funding. Then again, there were insurance companies, pension funds or other large investors who wanted to systematically invest in us. Our fund is starting off as the largest Internet fund in all of Europe. That puts us playing up there in the top league. And soon it will be half a billion dollars strong and that is also only to the advantage of our Rocket Internet shareholders.

Want to keep reading?

Subscribe now or log in to read our coverage of Europe’s leading economy.