With its innovative cell culture system and a structured M&A process, Green Elephant Biotech is gearing up for growth
Green Elephant Biotech is a young biotech startup based in Gießen with big ambitions. Its founders, Dr. Joel Eichmann and Felix Wollenhaupt, have developed “CellScrew”, an innovative cell culture system with the potential to help the biopharmaceutical industry optimize the production of life-saving drugs and vaccines. Having established the company in 2021 as a spin-off of Technische Hochschule Mittelhessen, they have now embarked on the next development stage with support from Steinbeis M&A Partners. Winning Bürkert GmbH & Co. KG as a strategic investor gives Green Elephant Biotech access to new technological and financial resources. Steinbeiser Catharina Hübner interviewed Dr. Joel Eichmann and Felix Wollenhaupt along with Steinbeis consultants Magnus Höfer and Dr. Christopher Klein.
Joel, Felix, when did you realize you were going to need a partner for your planned financing round, and how did you come across Steinbeis?
Felix Wollenhaupt:
In the biotech and biopharma sector, it’s not unusual to raise external capital to finance the development of a product. It takes a very long time to bring products to market because they can only be successfully placed once all the regulatory requirements have been met. We started raising capital from business angels as soon as we founded the company and subsequently also spoke to various venture capitalists. But we eventually decided to pursue a more extensive, structured process and make a comprehensive pitch to the market for our next financing round. Magnus Höfer came immediately to my mind as he had worked with me as a business angel in my first startup.
Joel Eichmann:
I thought Christopher Klein played a really key role – he has a technical background in biopharma, chemistry, life sciences and medical technology and was asking the right questions even in our first meeting. In our technology niche, it’s absolutely vital for the people we work with to understand both the industry and the technology itself. The Steinbeis M&A Team immediately grasped what we’re doing and why our case is worth adopting and supporting.
Christopher, what particularly excited you about this setup and founder team from a professional perspective?
Dr. Christopher Klein:
From a professional point of view, I was intrigued by the idea of commercializing an adherent cell culture technology. Because of my background, I’m familiar with suspension cultures. And in the adherent cell niche, for the last 100 years one has been using simple culture vessels with a low specific surface area for the cells to grow on. Green Elephant’s technological breakthrough is exactly what the industry and the medical profession have been waiting for – especially in view of the growing demand for cell therapies and vaccines.
You successfully concluded the process together in just six months. Is there one moment you’re particularly proud of?
Joel Eichmann:
The moment when it struck me that we’d really got over the finishing line was during a big meeting we had. Almost all of Bürkert’s Executive Board was there, including their CEO, Georg Stawowy. You could just tell that it was going to work, not only at a technical level, but also at the level of the individuals involved. The Executive Board members understand us and know how to collaborate with startups. After that meeting, I had a feeling that this could really work.
Magnus Höfer:
It was that day that I also sensed the chemistry was very good. Consultants can tend to be a bit overprotective of their clients, we try to leave enough space to allow the building of trust between the different individuals.
That brings me to my next question. Would you say, in retrospect, that it’s especially useful for such a process to have the “Steinbeis signature”?
Felix Wollenhaupt:
Absolutely. This was our first professionally conducted pitch to the market. The process was far more structured than in the previous rounds, especially in terms of the methodology used. We had a clear schedule and a defined procedure that we were rigorously sticking to. In previous rounds, there was a lot more of iteration and spontaneous adjustment. But the most important thing for us was to have a partner with a deep understanding of the market who also understands our product and has access to a strong network.
Joel Eichmann:
The key for us was to have the full package of know-how and the right people. We obviously also know the market ourselves, but it was this complete package that did make the difference.
Steinbeis M&A Partners developed a valuation model specifically for startups. How important was this for you?
Magnus Höfer:
As consultants, we don’t only add value by asking insightful questions and presenting Green Elephant to investors in the most favorable light possible – we also do so by putting forward convincing arguments for an appropriate valuation. We formulated these arguments together with Felix and the entire team, who already had a very professional business plan. This allowed us to develop a well-founded valuation document specifically tailored to a startup and to play an important role in the negotiations. Ultimately, a document like this provides a rational basis for negotiation and facilitates the entire process. It reveals the implicit assumptions and instantly lets you see where the sticking points are, which issues still need to be addressed, and where there may be fundamental differences of opinion that cannot be overcome.
How important are speed and quality in your work, and how do you strike a balance between them?
Felix Wollenhaupt:
Being a startup gives us a big advantage over established large enterprises – by our very nature, our structures make us extremely agile. Our organizational structure and operating procedures enable quick decision-making and swift implementation of innovations in the market.
Dr. Christopher Klein:
I couldn’t agree more – we often need to push our clients, but that certainly wasn’t the case with you. You spurred us on, always wanting to know when we’d be taking the next step. We passed the ball back and forth between us, and that’s why we were able to complete the project in just six months. This was also important in terms of the maturity of the convertible loans. We met all the deadlines, even though deals in the market tend to take longer at the moment.
What advice would you give other young biotech companies to help them succeed in the current market environment?
Joel Eichmann:
One key tip is always to allow more time than you think you need. That may out there as soon as you can and tell the world what you’re working on, even if the product isn’t ready yet. That way, you’ll quickly find out whether the market actually sees the problem like you do or whether it may already have found other solutions.
Dr. Christopher Klein:
When it comes to raising funds, the first thing a lot of people think of is venture capital. But the landscape has changed. Today, there are more family offices, business angel networks and, of course, the corporate venture arms of large pharmaceutical and medtech companies, which operate as something between a strategic investor and a financial investor. The strategic approach that we chose here, which lends additional flexibility and options, is particularly promising in my view.