“As a startup, you can feel that you are at risk every day.” – Founder of Fox & Sheep, Verena Pausder
Fox & Sheep founder Verena Pausder gave Silicon Allee the opportunity to catch a glimpse into her exciting role in developing child-oriented apps, fostering platforms for teens to dive into the world of entrepreneurship, and empowering and connecting women founding tech companies in Berlin. From her days as an online browser game developer to breaking into the mobile app scene with full force, Verena Pausder has plenty of insight to offer those trying to crack through.
So, you cater to kids, how would you pitch Fox & Sheep in a simple way?
That’s easy, we make apps for kids, worldwide in sixteen languages and we do digital labs where we teach kids coding, animation, and robotics.
When was Fox & Sheep founded?
Who started the company and are they still around?
Myself and Mortiz Hohl, but he left the company three years ago. So, it’s just myself now.
What was the inspiration to start a kid-oriented company?
The origin was when the iPad came out. Initially, I don’t think it was for kids, but it didn’t have a mouse or a keyboard so it was like a seamless user experience for the first time. Since previous online browser games that I worked on always had passwords, keyboard necessities, and security, the iPad suddenly made it so these weren’t issues anymore. So, I don’t think it’s made for kids, but it’s suitable for kids especially small kids. For the first time, it was a child’s device, but without kids content. So, we thought why not try and make content for kids because parents are more than likely to give their devices to their kids. Also, content always comes from America and China to Europe and we wondered why can’t it be the other way around? That was the initial kickoff.
Gaming is a competitive space. Who is your competition and why are you better?
It’s got less competitive over the years because it is a market which is competing worldwide so it’s not like it’s us against others in Germany and in the USA. It’s not app developers against each other; we are all competing on the same battlefield because we ship our apps in sixteen languages so our big markets are the USA, China, Japan, Russia, and Brazil. So, the consolidation has gone pretty quickly. You can’t survive if you don’t have a portfolio of apps; a few years ago you could have one app and be successful with it. Now you need a lineup so you can cross promote one user from one app to the next. Also, you need a brand name because there are so many apps every week in the app store to a point where the user loses orientation. So, he needs to know that’s Fox & Sheep and he remembers, “I’ve already got an app with Fox & Sheep and I trust them and I trust the app so I will download the next.”
We still have two to three competitors here in Germany; it used to be far more. We have maybe twenty globally. We are lucky that we were early; we were one of the first. Then, we had a huge hit with one of our apps called Nighty Night which gave us a lot of cash flow to do more. We then did an app with Christoph Niemann who is an international illustrator star and he lives right around the corner. Since he lived right in the neighborhood and we saw his app in the App Store, we wrote to him telling him that he had an amazing app and we asked him out for coffee. So, we met and decided to do more apps together. If he would have been somewhere else, we probably wouldn’t have met and the app wouldn’t have happened, so I think we had a bit of luck and lucky moments along the way coupled with very early success.
Do you have any advice for new entrepreneurs in Berlin?
Really make use of the network and of the people around here before you start. That doesn’t mean checking your idea with everyone while running around, but there’s so many startups, so many good ideas, and so many good people, so it really has to be brilliant what you startup now. It can’t just be because you’re bored or because you think it’s a great lifestyle. By talking with others and telling them your idea, they will point you to the right people and say, “Wait a moment, I think I’ve heard that idea before. You should talk to Peter.” Then Peter says, “No way, I’m doing something entirely different, but Thomas is doing something the same.” And then if you’ve been passed around and everyone says, “No, that sounds like a great idea,” then go. But, I feel like the time is over where everyone can found anything; it’s too mature now. So, we need more mature ideas.
If I am founding in Germany, I would always found here because the network effect that you have here is just so quick. Berlin is a city that hasn’t quite finished like many other cities that are successful in the tech sector like London. Tel Aviv is another example, but they will never be finished evolving because they are always at risk. But, Tel Aviv and Berlin offer people the space to be imperfect, to make mistakes. If you go to London, everything is so expensive, everything is so mature to the point where you can’t be imperfect in any way, so I always feel that these cities that are finding their own purpose make it much easier for people to start.
Has there been a group, individual or project that has had the most influence on you during your time as an entrepreneur in Berlin?
The Entrepreneurs’ Organization was important for me for a time. I haven’t been a part of it for the last three years, so it was more to start me up. I wasn’t too sure about every part of our business yet. I needed feedback, I needed to know how to communicate with employees. A lot of topics came up. They were a good organization in that time. They still exist and they are huge in Berlin. They are also called EO and it has eighteen chapters with twelve people per chapter and they meet on a formal basis and they give feedback on all aspects of life. It’s been around for nearly twenty years and it has been in Berlin for nearly ten years. It’s international; we have it in every city.
You’ve been in the scene for a while now, have there been other projects you’ve worked on along the way?
In 2013, I founded a network called Ladies Dinner where the initial thought was to gather female founders in tech because there aren’t that many. The ideas were rather than to say, “Eh. We are not that many and why can’t there be more of us? Who can help?” to just meet and to grow within. There were eighteen of us when we started and now there’s approximately seventy on the list. We meet every three or four months for dinner in a different restaurant. It’s completely sponsored by other companies and we use the evening to do business, to get better, to share the ideas for how to practice the best, to extend the network, and to rely on each other. It’s not like, “let’s talk about our kids” and have a great evening, it’s more helping each other out in the business sector. I once got an email from one of the ladies pointing me towards a journalist which was more suitable for me than for her for example. We use this network to bring others to the light.
Also, one must think beyond just creating their own business and they should think on how they can contribute to the ecosystem. Ladies Dinner was one, but we also started Startup Teens back in 2015. With Startup Teens, we want to spark the interest of entrepreneurship for teens between the ages of 14 and 19. Germany’s far behind on that. Now that we have such a lively startup scene, why not take all that know how and networking and make it available to the students so they will be more likely to found a company themselves one day?
Can you think of one particular moment that has been pivotal during your entrepreneurial career?
We sold the company to a strategic investor in 2014, but I stayed on board. I sold some of my shares, but I still have some so I still have 11% and they have 89%. That was the moment when Moritz left and I was suddenly a single founder, not a co-founder anymore. We were suddenly owned by a strategic game manufacturer HABA. So, I thought many things would change and I hoped they wouldn’t because I always wanted to stay the entrepreneur that I always was. I still had so many ideas for this business and I didn’t want to stay until I got my payout and then say, “I’ve done it. Bye.” But you don’t know how it works out and I think that was the moment where you grow up; you have to be more of a manager, but you still have to keep your entrepreneurial roots because a company like this doesn’t work by managing it. You can say that you make apps and that’s fine, but you constantly have to adapt to what’s happening. There are so many new things so you have to stay on top of them all. So, this was an emotionally important moment. Questions like, “Would I manage the transition? Would I stay an entrepreneur? Would they let me?” arose. It all turned out pretty well, so that was good.
The pivotal business moment was in 2011 where Moritz and I were running a company which dealt with online browser games. You could see the market declining. Mobile was on the rise, but it wasn’t quite there yet. So it wasn’t like a direct transition to mobile games on the rise, causing online browser games to go down. We just decided to take what we were doing for the online browser games and focus our energy on the mobile sector. We retrained on the job, pivoting the company from a web-focused one to a mobile company. That was the toughest business moment because it was more than jumping into the next blue ocean because it wasn’t really there yet, but you knew you had to jump.
As a startup, you can feel that you are at risk every day.
Do you have a favorite spot in the neighborhood?
I have so many. I really like Röststätte on Ackerstraße; they have really great coffee. I also love Dudu; I like stopping there for lunch, they are on Torstraße. I also love DALUMA on Weinbergsweg. They are probably my favorite three spots in this area.
Has Berlin’s informal nature and unique history – urban fabric, city divide, demographic, etc. – been a positive aspect of your time in the city?
Absolutely, because I think it’s a great source of inspiration if you walk past buildings or construction sites and you feel like everyone is building up something. It gives you the feeling that everyone is starting up so I might as well join. You don’t feel crazy starting your own company and you don’t have lots of doubts and fears. That’s what the city gives you, and the history is important for me because it doesn’t feel artificial. You have the feeling that people you meet who lived through this history have a huge depth in them. It’s not how I imagine Singapore where you have a lovely office and a lovely idea, but you will never get into the city because there’s not so much to explore; it ends at a point. But here you always find the next nightclub, bar, building, or gallery where you think “oh, crazy”. The years of inspiration never end. It’s the first city I’ve lived in that after six years I didn´t want to leave. It’s more like, “Here’s to the next six years!”
Cheers to that! So, then where do you see Berlin in the next 6 years?
I don’t think it will be that much different in our ecosystem than it is right now. It will mature a little more, more money will flow into the city in terms of venture capital, companies will get bigger, but I don’t think it will be a different city in five or six years. Maybe some construction sites have finalized, such as we might have an airport, but I think it will still have the spirit that it has now. The past five years were much more drastic than what the next five years will be.
Finally, Coffee, Tea, or Club Mate?
Interviewed by: Andrew Haw
Photo: Cecile Mella