NRW Seed Grant – What’s Innovative Gets Funded

It all started with a tuk tuk driver in Cambodia. A college friend of Nils Lohmann met him on his trip to East Asia. This man told her that he wanted to build a school where children could learn English – because there was nothing like it in his village. And when I returned to Germany, the idea was born.

“As he did not have the financial means to put this in place, we had the idea: What if we offered a ‘socialbnb’, a social night with him? That we offer his premises free of charge as an overnight stay for travelers “, says Lohmann.

Nils Lohmann is one of the co-founders of socialbnb, an internet platform that offers accommodation worldwide. No commercial hotel rooms or holiday apartments are rented, but vacant premises of aid organisations. Rental income goes directly to local social or ecological projects.

“It means that as a traveler, I have the opportunity to get to know the job without directly helping. It’s really about this night service, but it’s still a great experience for the travelers to see the money go directly to the people.”

Start a business while studying

Socialbnb started as a student initiative. Nils Lohmann studied international business in Cologne, his co-founder Alexander Haufschild geography. They started the project together, first in parallel, between classes, essays and exams. It was in 2018. Today, the small business is autonomous.

Lisa Bökler leads through the long corridors of a building in the west of Cologne, in the middle of the industrial area. Here, the startup has its own space on an office floor, in new German: co-working space. Socialbnb now has ten employees. All in their mid-twenties.

Lisa Bökler is team leader and deals with the acquisition of new partners: from the reforestation project in Brazil to the integrative hotel operation in Germany.

Everything is done digitally, and the company promotes itself through social media, including Instagram, where contractors upload videos of themselves and their projects.

1,000 euros in start-up aid per month

The aid projects themselves set the price per overnight stay, plus an agency commission of 15% for the Cologne-based company – which the traveler pays. socialbnb now offers more than 145 accommodations in 45 countries, and they have already been booked more than 800 times.

The start-up was supported, among other things, by the NRW start-up grant, a funding measure of the Land of North Rhine-Westphalia. Up to three founders receive 1,000 euros per month for one year as start-up assistance, and there is also support from start-up consultants.

A good idea, thinks Professor Kai Buehler. He directs the Digital Business Management course at the Rheinische Fachhochschule in Cologne. He sits on a committee that evaluates new start-up projects and is himself involved in certain start-ups.

“It’s interesting because it’s starting where investors wouldn’t invest yet, because it’s still very early. And it’s helpful if you think about it, if you have three founders and each of them gets $1,000, then you’re at $36,000 a year. You can do something with that,” Buehler says.

2,500 Founders have received the grant to date

The start-up grant was introduced in July 2018 by NRW Economy Minister Andreas Pinkwart of the FDP, a long-time companion and patron of Federal Party leader Christian Lindner. So far, more than 2,500 founders have received the grant in their home country: it doesn’t matter if it’s a new product or service. Funding is given to anything that is innovative and forward-looking.

So far, Germany has tended to be at the bottom of the list when it comes to the number of business start-ups in an international comparison. This is not only due to access to capital, but also to bureaucracy and less willingness to take risks on the part of Germans, says Buehler: “I also believe that the mentality in big business is not is still not the one that says: we also like to hire founders who have failed and who have known a lot more.”

The project could become a model for a seed grant at the federal level. This is what the FDP demanded in its election platform: industry-independent funding that entrepreneurs can apply for in the start-up phase. Buehler would welcome it: “It helps startups tremendously.”

Rescue in times of Corona

The NRW start-up grant was the salvation of socialbnb creators: at the beginning of 2020, young entrepreneurs became independent, but then Corona arrived. The travel market collapsed worldwide, the worst possible time to establish yourself in the industry, recalls Nils Lohmann: “It was super useful at that time to continue to do everything and to be able then quitting the part-time job and finding himself could focus more on this start-up project.”

Lohmann and his colleagues have taken advantage of the Corona period to expand their range and improve the website. Giving up has never been an option for young entrepreneurs.

The first successes of the local projects motivate them to continue: In the village of the tuk tuk driver in Cambodia who started everything, 60 children now go to school: “They managed to finance both the teacher of English and laptops and build a small school next door. And that was our thought when we said: We want to develop this from this student project into a social start-up. And then it was clear: We want take this forward in the long term.

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