Q&A with Jennifer Diedrichs, investment manager, EnBW New Ventures

Crispin Leick, managing director (MD) of EnBW New Ventures (ENV), Germany-headquartered energy utility EnBW’s corporate venture capital (CVC) arm, said: “I would very much like to nominate Jennifer Diedrichs from my team to GCVs Rising Star.

“She was promoted [in 2020] to investment manager and closed our lead investment into 3Yourmind, which marks our first strive into the additive manufacturing space, where we see a lot of potential for sustainable and digital logistics as well as competitive advantages for infrastructure operator.

“She joined ENV and the VC world in February 2018, while she was active more on the business model and consulting world before that.”

1. First, just give us a quick overview of who you work for, what you do, and how long you have been doing it.

I am currently working as an investment manager at EnBW New Ventures. I started there in 2018 as an associate and got promoted to investment manager [in 2020]. ENV is the CVC of EnBW, one of the largest infrastructure operators and utilities in Germany: grids, e-mobility (the largest DC-charging network in Germany), telco, (renewable) generation and 6 million retail customers in Germany.

Working with ENV is my first CVC job, but I have been closely working with CVCs before – as a management consultant with the accelerator of a client to bring solutions into the company, by setting up a new innovation structure for another client including the decision for a CVC, or in academia with a Dutch-Swedish EU research project on the impact of government climate legislation on CVC and VC investment decisions.

Interviewing many VCs and CVCs actually made me want to go into VC and CVC in the first place. I am eternally grateful for this experience and was very happy to meet some interviewees four years later and discuss potential co-investments with ENV.

2. What attracted you to CVC?

Honestly, I feel a bit ambivalent about CVC. CVC has many advantages and massive levers, but the setup needs to be right to avoid pitfalls or harm to startups and the corporates behind CVCs, and take advantage of the close relationship with a corporate. I truly believe in the success of “single LP funds”, that is, CVCs looking at investment opportunities with the same criteria as any other VC but an additional criterion of the startup adding value to the parent company. If this is secured, having a corporate in the background as a partner, a “friendly first client” in a new vertical or partner in new or additional product development can be an absolute gamechanger!

3. What have been your greatest successes at your unit?

In the three years with ENV, most of it as an associate, investment manager only since this year, I, unfortunately, have not got any fantastic exit stories yet. But there is a couple of things I have initiated that have improved our work as a CVC and for the startups we invest in, next to the three investments into new portfolio companies I have led – I am so proud of what the founders achieved business-wise and also with EnBW.

With those investments, I have added a new focus topic to our investment thesis, from which also EnBW benefits a lot by being a prime customer and also opening new B2B (white-label) business opportunities to EnBW: customer service.

The customer or in general human being at the core of all actions is something that drives me. Not only making utilities more customer-centric but also in our own team. I have implemented team satisfaction as a key topic, including monthly surveys and KPIs – what gets measured gets done. The next topic is diversity – in our team (we are actually doing quite well with 50% female share) but also among the startups we invest in. I cannot tell too much yet – stay tuned.

Another initiative that helps us working better with startups is the Berlin office, where I am located now and which I set up with a colleague. It gives us the opportunity to be more closely connected with Germany’s major startup hub (and yes, two of my three investments are in Berlin).

4. What have been your biggest challenges?

This might sound cliché, but my biggest challenge was actually being taken for granted. On all boards, which I am a member of, I am the only woman and the youngest member. By now I am very satisfied with my standing, but I had to prove myself, which was not always easy. Getting compliments for my negotiation skills recently felt really good, in particular, because it kind of stopped the chip on my shoulder – the “boys club” or “maybe you have to be a man to be successful in a man’s world” chip. That is why I push the diversity topic – like our MD and all studies on the topic, I do believe mixed teams perform better! But also that women are often more self-conscious than men in the same position. Being more reflective and humble is a major strength, but it should not turn into doubts, not speaking up, or taking a position they are qualified for.

5. What is your main professional ambition for the future?

The ultimate ambition is to run a fund myself. But that will still take a couple of years. My main short and medium-term goal is to invest more into climate-neutral and CO2 reduction solutions. ESG is a topic we take seriously – from what we invest in to how we act ourselves (for example, no in-country flights and no flights up to 800 kilometres in neighbouring countries, even if it might take ages by train). Companies, whose primary objective is reducing CO2 emissions are not part of the investment thesis yet. We do have a couple of investments e.g. into solar, smart parking, or additive manufacturing that do, but it was not the main thesis. This is something I would really like to change and make CO2 reduction an integral part of our investment thesis.

6. What do you think all CVCs could do better to make it a stronger industry?

Great question! Actively working on it! I believe there is still too much feeling of competition between CVCs. Leveraging strong CVC networks like GCV not only as an investor network but also as business development for startups, for example, opening “friendly” doors not only to the own corporate but also to other corporates is something that is not fully leveraged yet! This could be a game-changer – when you get warm intros not only the CVC that invests in you but also 10 other blue-chip companies, potentially in the same industry, i.e. having the same problems/use cases! This is something I started doing with CVCs I know well, e.g. sit on a board with,  but definitely want to extend!

7. And, finally, for colour, what did you do prior to CVC or in your spare time?

I used to work as a management consultant in the energy industry. This experience actually helps me a lot in CVC and VC – I know the purchasing processes of blue-chip companies very well, and a lot of younger startups turning mid-market and enterprise are often a tad naïve about it. I did a couple of IT projects, which helped me understand big corporates’ current digitisation challenges (startup opportunities), and in general, made me have a service provider mentality – next to a lot of structure and analytics, and big company politics. If I had to choose, this would be the single most important lesson: Your customer is the most important thing to you. I am trying to follow this not only at my job but in general. I love helping people and am very active at my alma mater – giving lectures, mentoring students, and so on.

Privately I am an avid surfer. I am on the board of Germany’s largest surf club, and also have a B2C side business selling surf accessories. This even helps a bit for the VC job – living through early-stage founder struggles… I love it!