BUS604: Innovation and Sustainability

Background

Founded in 2012 when the real estate market in Berlin was depressed, Factory introduced a unique business model based on organic acceleration. It began when a group of real estate developers purchased an old factory and started to rent out its facilities to tech start-ups and to actively promote the space as a venue for innovation-related events, soon bringing on board teams working for major tech companies. Now Factory concentrates on bringing together in one place the best of technology and their programs to nurture innovation, supporting the ecosystem. The space relies on the intrinsic motivation of the start-up culture to support one another in order to improve the chances of entrepreneurs to succeed.

In Essence

Factory is a coworking space that creates a worldwide ecosystem for start-ups and tech companies. To positively impact the change that is happening in society through technology and entrepreneurship, the space fosters and accelerates innovation around the globe. The space serves as a platform for a large number of events and offers its members unique access to the latest trends. While some events, such as fireside chats or hackathons, are open to the public, others are reserved for the member entrepreneurial community - for example, knowledge exchanges and VC office hours. Factory often invites leading business figures to the members-only events. It also offers its members access to mentors and an array of workshops; these services are designed to help founders navigate challenges typically faced by start-ups. With its objective of flexible use, Factory continuously expands and adapts its space by adding communal spaces and large event spaces to boost the ecosystem. It has also incorporated "Factory coworking," which provides high-quality office space for free- lancers and start-ups as well as project teams and employees from corporations. Other Factory assets are its sponsored residency program, which helps entrepreneurs entering the Berlin ecosystems, and its supporting amenities and recreational facilities for the purpose of its community.

Impact

Factory is a general space that helped catalyze an urban tech ecosystem in Berlin. The space contributes to urban regeneration and entrepreneurial communities building in the city. Factory continues to play a central role in the latter by virtue of its extensive partnerships with private companies, unique high-quality events organized for Factory's members, and successful strategy of corporate-start-up relationship building. Factory presents one of the best examples of a space that started as an ecosystem catalyst and then embraced an element of urban regeneration. Because of its economically sustainable rental model and strategic relationship management, the space successfully attracted many corporate innovation teams that now are members of the community and are based at Factory.

In Practice

Project in Focus

Factory supported the creation of the Lufthansa Innovation Hub (http://hub.lh.com/). After exploring the idea of identifying new business potentials through start-ups, Lufthansa decided to launch its own Innovation Hub and placed the team at the Factory, which resulted in the launch of several innovative services. Factory greatly contributed to the project's development by being able to nurture the wider network to support the development of the service. With the Lufthansa Innovation Hub, Factory demonstrated its business model's sustain- ability and its potential to attract large firms as clients and partners.