"Like no other German city, Berlin offers a huge pool of talent in the fields of technology and data science."

Wattx, the company builder of the traditional medium-sized company Viessmann, is one of the German figureheads when it comes to the digital transformation of existing successful models. The Berlin-based company's multidisciplinary team focuses on core topics such as AI, Industry 4.0 solutions and construction technology, and has already provided the impetus for several innovative start-ups since 2016. #ki_berlin spoke with wattx Managing Director Dr. Martin Mittermeier about the work of a company builder, the increasing importance of deep-tech technologies for SMEs and the national appeal of Berlin as an AI location.

Hello Mr. Mittermeier. Thank you very much for your time. Let's get straight to the point: how did wattX come into being, and what are your specialities?

wattx is part of the Viessmann Group. We started out as a vehicle for innovation and transformation and have gone through a number of strategic corrections.

Today, we work with the Viessmann Group and other SMEs and build digital products and business models for them. Our work is financed not only by corporations, but also by financial investors. Venture capital funds have invested in our ventures Statice and Hasty.

How does the setting up of a new start-up with a company builder function, and how and from which area do you select the projects that you initiate?

We always proceed in phases, in other words we have a so-called stage gate process, which we work through quite precisely. This results in a number of questions that have to be answered in each stage and which are typically oriented towards a venture capital investment: is there a sufficiently large market, does the product solve a real problem, and is the customer willing to pay for it?

When we work together with medium-sized companies, the question of which advantages of the core organisation can also be used for the new venture or product is also raised. Our expertise lies in the areas of AI, industrial solutions and construction technology.

You already have some exciting projects in your portfolio, in which you want to establish future-oriented technologies in the industrial sector - with a special focus on the construction industry. Can you tell us something about some of the start-ups that have been spun off at wattx?

We have already launched a number of start-ups, for example SNUK, an IoT platform for building management, which has increasingly focused on the hospital sector and was sold last year. Statice, which deals with synthetic AI-generated data that has the same statistical properties as a synthesized real data set, but does not allow conclusions to be drawn about personal data. Hasty is a tool to annotate images for use in machine vision and drastically simplify and shorten this process. Finally, Deevio provides an application which in turn uses machine vision to automate quality control in industrial manufacturing.

Especially deep tech disciplines such as AI, machine learning or natural language processing are technologies in great demand worldwide. In which of your ventures do these technologies come into play and how?

The last three ventures use one of these technologies, but in all cases machine learning approaches are applied. Depending on the venture, these algorithms either generate synthetic data, learn to recognize objects on images, or help to detect errors in the production of, for example, foundries.

Viessmann is a company with a long tradition in Hesse with a further location in Berlin. What was particularly decisive in deciding to settle here with WattX? Which advantages does the location offer?

Like no other German city, Berlin offers a huge pool of talent, especially in the fields of technology and data science. The staff required to deal with deep tech topics is much harder to find outside of Berlin. In this respect, the supply of manpower was certainly a major factor as regards the choice of location.

Besides this, a lot is happening in Berlin. Many new companies are being founded, more and more venture capital funds are settling in the city and, in general, Berlin is attracting many international talents. So you can really have your finger on the pulse here and build up a suitable network if you want to test new ideas and generally become active as an entrepreneur.

In recent years, the AI scene in Berlin has continued to grow. How do you feel about the status quo as regards new technologies and innovations?

I feel that a lot is happening in Berlin in this respect. This can be seen in companies like Rasa and Hasty, which are attracting top international investors and building real infrastructure technology, in other words technology that can be used by almost all companies operating in the field. This also seems to me to be unique in Germany. While great companies are emerging in certain areas in Munich and the Ruhr area and in other locations, the German AI scene is very much focused on Berlin.

According to a study carried out by the BMWi in 2018, many companies are still hesitant to use future technologies such as AI in their companies - only around 5% are relying on them. What is your impression and how can a rethink take place?

My impression from working with medium-sized companies is that companies are still in a learning phase, in other words the people involved must first understand exactly what is meant by AI and which applications are possible with it.

To a certain extent, a first adaptation phase is slowly beginning, for example in the field of robotic process automation. In this phase, companies are beginning to use the new technology provided by third parties within the company. It seems to me that it will still take some time for own products to actually be equipped with AI components. I hope that there are some who dare to take the step and use the technology to develop better products.

How do you see Berlin as a location compared with other AI hotspots worldwide? Is it also a good place to operate internationally?

The international investors that the city attracts give me hope that Berlin is strong here, and I know from our ventures that they can also acquire international clients. In this respect I think that Berlin is on the right track.