800 Company Foundations in 2 Years: How Factory Berlin Aims to Become an AI Powerhouse - with Udo Schloemer

About this episode

Factory Berlin is making a radical pivot: from a traditional coworking space with a membership model to an AI-focused incubator with an equity participation model. Udo Schloemer, founder of Factory, explains how his Berlin tech hub plans to master this transformation and why Europe, despite all criticism, is the ideal location for the next generation of tech companies.

From Membership to Equity: Factory's New Model

Factory Berlin is undergoing a fundamental strategic shift. Instead of relying on the traditional membership model, Schloemer is taking a different path: "We now take 10% equity instead of a membership fee," the founder explains. This decision is based on the realization that speed is crucial in today's world.

The new model allows Factory to work more intensively with startups while being able to participate in their success. "From idea to product in one week" – this is the ambitious goal that should become possible through the use of AI.

AI as Game Changer: Prototyping in 24 Hours Instead of 14 Days

The integration of artificial intelligence is fundamentally changing Factory's entire way of working. What used to take 14 days, they now accomplish in 24 hours with AI support. "AI changes everything," Schloemer emphasizes, seeing this as the greatest transformation of our time.

However, this development presents not only opportunities but also psychological challenges. The speed at which the working world is changing requires constant adaptation from founders and companies.

Network Beats Skills: The New Currency of the Future

In the AI era, according to Schloemer, priorities are shifting: "Network vs. Skills" – the network becomes the new currency of the future. While technical skills can increasingly be automated through AI, human connections and cultural aspects remain irreplaceable.

"Why culture remains important" is a central question that occupies Schloemer. Despite all technological advancement, it's ultimately people and their relationships with each other that determine success.

Germany's Hidden Potential: The Mittelstand as Strength

While many complain about Germany's slow digitalization, Schloemer sees a great opportunity specifically in the German Mittelstand (medium-sized enterprises). "The strength of the Mittelstand" lies in the combination of traditional expertise and willingness to innovate – when properly utilized.

"Mittelstand vs. Corporations: Who can really utilize innovation?" This question intensively occupies Factory. Large corporations often have overly cumbersome structures, while the Mittelstand can react more agilely. Here, Schloemer sees the greatest potential for applying new AI technologies.

A critical point is the German planning mentality: "Why planning is often hindering" and "The plan replaces chance with error" – these insights show that too much planning can brake innovation. The right mix of vision and implementation is decisive.

Leadership in Transition: From Patriarchal to Participatory

Factory's transformation also reflects a fundamental change in leadership culture. Schloemer advocates for a shift "from patriarchal to participatory." This new leadership philosophy requires the right balance between control and freedom.

"Why mistakes are important" is a central building block of this new culture. Only those willing to take risks and learn from mistakes can survive in the fast-paced AI world.

What Founders Should Do Now

For other founders, Schloemer has a clear message: "Adapt or get left behind." Those who sleep through the AI transformation risk losing connection. At the same time, he criticizes German politics: "Politics and incentivization: Why Germany struggles" – here he sees great need for catch-up.

Factory Berlin shows with its transformation how traditional tech hubs can reinvent themselves. With 800 planned company foundations in two years, Schloemer sets an ambitious goal. Whether Berlin can actually become an AI powerhouse will become apparent in the coming years. The groundwork has certainly been laid.