Trading on the capital markets is anything but plain sailing. The fact that BRAIN nevertheless successfully negotiated its entry onto the stock exchange proves that investors place trust in the bioeconomy. An interview with BRAIN “captain”, Dr Jürgen Eck.
BRAIN: BRAIN is a white industrial biotechnology company that focuses on the bioeconomy. What is the big difference between BRAIN and other technology com-
panies in this sector?
Dr Jürgen Eck: BRAIN is very different from red or medical biotech companies that have high development costs and therefore focus on developing one or just a few products. The main challenge they face is the clinical trial of active pharmaceutical ingredients. In the last few years, BRAIN has become a key player in the European bioeconomy sector. Our industrial biotechnological methods give us a wealth of opportunities. We reform industrial production processes, making them more efficient and sustainable and thereby paving the way to the bioeconomy. The aim is to use natural solutions in the form of microorganisms, enzymes and natural biomolecules, in industrial production among other areas. This makes it possible to achieve key improvements as compared with conventional products or production processes, e.g. in the chemicals, mining and consumer goods industries, as well as the food and cosmetics industries.
BRAIN: What is BRAIN’s unique selling proposition?
Dr Jürgen Eck: Our USP is the foundation on which all our technology platforms are based. It is our extensive BioArchive that we are fond of calling “nature’s toolbox”. It contains some 53,000 comprehensively characterised culturable microorganisms, over 50,000 structurally characterised natural substances and fractions of edible plant material as well as a multitude of new enzymes and metabolic pathways from organisms that were previously unculturable. We are able to access this unique collection of natural resources very efficiently using the technology platforms we have already mentioned, and use it to create new products for a sustainable economy.
BRAIN: BRAIN now has a second, apparently very lucrative mainstay in addition to research and development. Are you on the way to becoming a production and sales company?
Dr Jürgen Eck: It’s true that BRAIN is no longer purely a research company. We serve the market in two business segments, BioScience and BioIndustrial. Alongside our cooperation business with well-known industrial groups, we are increasingly developing and marketing our own products via our subsidiaries. The BRAIN Group has grown steadily in the past, and we want to continue doing so in both business segments.
BRAIN: Can you tell us something about current large-scale projects that are in the pipeline?
Dr Jürgen Eck: We have a number of interesting development lines in the various product areas that are to be brought to market in the next few years. We are devoting special attention to taste modulators in the food sector, among other things. The issue of health is of high global importance. In times when more and more countries are pressing for a sugar tax, for instance (as recently announced by the UK) – with the aim of reducing the sugar content of foods – biological sweeteners and natural sweetness enhancers are gaining in importance. The issues of taste and health also concern the animal nutrition sector. We are also involved in a number of projects and cooperation arrangements related to environment protection, which corresponds to the contemporary zeitgeist. This concerns for example the biotechnological production of lubricant additives from renewable raw materials, or the use of CO2, e.g. for manufacturing bioplastics. We carry out several of these research projects with a number of industrial partners within a strategic alliance called ZeroCarbFP, which is partially funded by the German Federal Ministry of Education and Research (BMBF). In this alliance, we and our partners develop technologies and processes that convert industrial waste streams into valuable substances by means of microorganisms. These partners include Fuchs Petrolub, Südzucker, Emschergenossenschaft and BioEton.
BRAIN: BMBF supports some of your research projects? Do you feel you have political backing?
Dr Jürgen Eck: Most definitely yes. The global political arena sees the bioeconomy as a field with potential for the future. Various programmes are in place to support com- panies that concern themselves with sustainability and the introduction of bio-based processes to industry. The subject of the bioeconomy is also frequently covered by the media. It is an important field for the future, not just for politicians. Building a bio-based economy was also the theme of the Global Bioeconomy Summit in Berlin, which was organised in late November 2015 at the initiative of the German Government’s Bioeconomy Council, and was attended by more than 700 participants from 82 countries. Shortly after, on 30 November 2015, the negotiations on a global climate agreement were launched as part of COP 21 in Paris, where binding global goals for sustainability and resource efficiency were defined.
The time had come to gain financial autonomy
BRAIN: Dr Eck, why did BRAIN go public at a time when the financial market conditions were so unfavourable?
Dr Jürgen Eck: In terms of BRAIN’s corporate growth and the strengthening of our product development lines, the time had come to go public in order to gain access to the capital market as a further expansion step en route to implementing our industrialisation strategy. Going public was the logical consequence. The situation on the stock markets didn’t exactly make things easy for us. But it became clear that the capital markets also recognise the bioeconomy as a sector that is definitely the shape of things to come, independently of the current stock market turmoil. That was also the general opinion of investors and analysts at the roadshows. The large proportion of private investors shows the growing interest and trust in the bioeconomy, irrespective of the cold wind that is currently blowing through the capital markets.
BRAIN: When do you think BRAIN will reach break-even point?
Dr Jürgen Eck: We intend to consistently pursue our industrialisation strategy and our “multi-product opportunity” approach. This is based on the frequent possibility of using an innovative solution developed by BRAIN in differ- ent market segments and for different applications. Apart from that, we want to expand our business activities with our cooperation partnerships in the BioScience segment and the BioIndustrial Segment on a global scale, beyond Europe. If we look at our financial history, we can detect a trend towards the expansion of our BioIndustrial business area, whose total operating performance has shown clear two-digit growth since the 2012/13 business year. So with the BioScience and BioIndus- trial segments, we have two reliable growth engines that are intended to drive the sustainable positive development of the company and the Group.
BRAIN: Will BRAIN’s transition to a listed company mean major changes as regards your employees or corporate policy?
Dr Jürgen Eck: We at BRAIN are team players, that much is clear. Our team’s creativity and our fantastic corporate culture are among the keys to BRAIN’s success, and our listing on the stock exchange will do nothing to change that – quite the contrary. Of course, we now have a greater obligation to inform the stock exchange and the public and have to comply with a larger number of dead- lines and formal procedures, but that mainly concerns the management and the finance department. Apart from that, we will further pursue our industrialisation strategy and aim to achieve further growth, but that is not really anything new to our workforce. In the final analysis, our employees were and are the ones who create the foundations for this growth.
BRAIN: Dr Eck, you have now been on the team since BRAIN was created almost 23 years ago. How much does the company’s further development depend on you as an individual?
Dr Jürgen Eck: We expanded our management team in good time when preparing for BRAIN’s next growth phases, and allocated responsibilities accordingly. Apart from myself, the 10-strong management team consists of other members who have been working at the company since its incep- tion, and are highly motivated to continue making a key contribution to its further expansion. A few experienced colleagues were also added to the Management Board in the leadup to the IPO. The company’s development rests in the hands of a team with a healthy mix of experience and expertise. The team is the real star in this story.
BRAIN: Dr Eck, thank you for this interview.