Germany’s largest real estate portal ImmobilienScout24 has taken more than a few people by surprise with the launch of You Is Now, a „startup platform“ that promises Internet entrepreneurs capital investment, business support and expertise worth 500,000 over 12 months to take their web business from infancy to the next level.

Behind the dodgy grammar and space-time conflation of the brand name – er … when are I? – lies a classic early stage incubator. ImmobilienScout24 is calling on submissions from young entrepreneurs who have already managed to set up their basic business concept, while promising a lot of help to develop it further. The basic idea of You Is Now is in an early stage deal: ImmobilienScout24 provides processes, resources and capital in return for an equity stake.

The person chiefly responsible for You Is Now is Torsten Oelke, a former management consultant at McKinsey and author of the book “Stars of the Internet” (German), which looks at the reasons behind the success of some of Germany’s most successful entrepreneurs. He is also attached to the DTO group, where his focus in on the Internet, venture capital, private equity, energy and real estate.

How does You Is Now work?

In short, would-be founders can submit a concept or idea of an already established company and You Is Now will select those they want to back. A completely worked out business model is less important than a strong team and an innovative idea, particularly ones that occupy the value chain of suppliers, buyers or marketers in the real estate sector. Concepts may apply to „information on living environments and neighbourhoods, mobile applications or social networks,“ reads the blurb. While real estate-related ideas are preferred, this is not a necessary condition for participation in the incubator.

Nevertheless, ImmobilienScout24’s expertise is in the real estate market so there is an obvious opportunity for startup entrepreneurs who can contribute in that segment. ImmobilienScout24 CEO Marc Cordier told Gründerszene they were particularly on the look out for ideas that put a fresh and innovative twist on an existing issue in real estate, or which took advantage of developments in mobile and smartphone technology, such as location-based apps – in short, any type of web or mobile startup that could benefit from a tie-in with the largest portal for buying, selling or renting property in Germany.

If the idea or the company is promising, the candidate will be invited to a pitch and an assessment made about how ImmobilienScout24 can contribute to the success of the business idea. If it clears the the final hurdle, the startup joins the You Is Now incubator and is then set to receive 500,000 worth of investment in capital, business support, mentoring and logisitics.

Deal mechanics of You Is Now

The resulting deal seals a cooperation agreement with ImmobilienScout24, whereby it has an option to take shares in the startup after an intial 12-month development phase. According to information provided to Gründerszene, ImmobilienScout24 will take an equity stake in the low double-digits; somewhere between ten and 30 percent is probably realistic. By comparison, Lars Hinrichs’s pre-seed incubator HackFwd takes 27 percent for a one-year involvement, plus three percent for mentors.

In exchange, the startup receives a complete support structure for a period of 12 months from the inception of the deal.  This includes office space and company infrastructure, administration support and also expertise in areas such as online marketing, accounting, legal and IT development and product management. In addition, the startup team receives coaching by staff from ImmobilienScout24 and regularly receives feedback from a committee of expert mentors.

You Is Now for 12 months – and then what?

The startup has no further obligations after 12 months if ImmobilienScout24 chooses not to take up its share option. In reality this would only ever occur in the worst-case scenario where the original idea has not proved particularly lucrative. But what about the best-case scenario 12 months and the exhaustion of a funding package valued at half a million euros?

Marc Cordier, CEO of ImmobilienScout24 that initial promotion with support from the property portal can be expected to also. If the seed funding expired, IS24 actively involved the placement of venture capital as access to financing. As Deutsche Telekom subsidiary is expected here in particular T-Venture ’s plan to move. The venture capital entity of Deutsche Telekom holds in addition to many smaller investments worldwide including 35 percent of the shares in Sevenload and 33 percent of the shares in myON ID.

One was for the promotion of ImmobilienScout24 following entry of T-Venture of Cordier classified as an option. But there is no more a requirement as a guarantee. With the contacts of a real estate scouts in the background is expected to open but also so that one or other VC-door.

As the incubator of ImmobilienScout24 be evaluated?

Pitched founder may wonder: What has to offer an „Internet Group“ as ImmobilienScout24 that is held completely by the Telekom, young entrepreneurs with innovative ideas? In all first line probably a well-functioning infrastructure and highly optimized processes, which could also benefit from a new company.What makes ImmobilienScout24 next to a branched network of contacts are likely to be particularly effective processes so that founders can start immediately with the appropriate steps, without having to go long in search of personnel and expertise have.

Anyone who has experience with Webthemen has something is more likely way of equity or well-connected business angel to go, but for founders who are still not firm with web topics like this, keeps You Is Now efficient processes and provide a secure funding . As an incubator could ImmobilienScout24 with You Is Now then the right incentives for fresh start-ups give. The conditions of the incubator, depending on what low double-digit percentage range, „ie,“ normal to slightly expensive.

Would-be founders could probably also fear that they are dealing with a lazy, slow-group structure in which the telecom revolves heavily at the helm. But Marc Cordier to start-up scene assured that just such scenarios are to be excluded. ImmobilienScout24 was sufficiently independent to the incubator on a self-copiers and should also act with the necessary pace. Such a structure would be necessary also for the entire Scout companies, this innovative approach to sustainable rise. For even ImmobilienScout24 You Is Now may just be the right way to get back guarantee innovative improvements in the daily operation. Whether working with You Is Now offered in this context for each founder is certainly in large part depend on what constitutes a claim of such cooperation. For the scene as a whole, the development of You Is Now is beneficial in all cases.