From startup to global leader – with virtual reality simulation
Pilots are safely trained using simulators while eye surgeons can exercise complex operations in a virtual environment. VRmagic, founded in 2001 in Mannheim, is a pioneering force in the area of virtual reality simulators for eye specialists. In our interview co-founder and management board member Dr. Markus Schill tells us how the firm became a global leader and why Mannheim is an ideal home for dynamic business growth.
VRmagic was founded in 2001 by a team of physicians, physicists and computer scientists – at a time when start-up culture was not yet a key issue in Mannheim. How were things back then for the founders?
Markus Schill: The situation back then was already good for founders. The vibe was a very productive as the university was establishing the Computer Engineering degree. I was head of a working group for biomechanical simulations. A tenured professor, Mr. Männer, suggested creating a biomechanical real-time simulation of the human eye and the community of eye specialists reacted quite well to „Eyesi“, our first trainings simulator for eye surgery. Nowadays our technology has become a standard in training eye doctors.
How did the idea develop into a business?
In 1998 the state was offering a program to help self-employment called „Young Innovators“. We applied and were granted funding for three part-time positions, which helped a lot. Founding a company felt tedious to us but the advice we received helped us define the necessary steps to reach our goals.
Which was the first major step to setting up business?
We were awarded the Research and Innovation Prize of the Rhein-Neckar-Dreieck Foundation, that is initiated by MLP founder Manfred Lautenschläger. With the 25,000 euros we received we bought an espresso machine – and set up the GmbH in 2001.
How does one accumulate finances for development in that phase of business?
We were often very close to just giving up. This has taught me that believing in one’s vision is crucial. We received the necessary funding in 2005 through a private regional network. One of the founders of SAP took over 25 percent of the shares of our start-up through Leonardo Venture 25. This was the only round of investment, as the first returns rolled in just as the funds were exhausted.
Was the financial success of the business model conceivable right from the beginning?
The concept of using virtual reality for medical training was an innovation and it created a paradigm shift. The business really took off once clinics were willing to pay appropriately for our simulators.
How does it feel to be a pioneer?
I was recently introduced as „the dinosaur of simulation“ at a conference. I was amused, but being a pioneer feels better. We created an entirely new market and meanwhile there is competition. Though as we are still pushing development forward we’re cool with that.
Today the Mannheim start-up center Cubex 41 offers an ideal place to launch start-ups in the field of medical technology. Would this have helped during the founding of VRmagic?
I assume so, as I know how important those networks are. But back then there was the Centre of Competence for Medical Technology, a predecessor of the Cubex and Wolfgang Möller who was General Manager there at the time, is now on our supervisory board.
Why did VRmagic remain loyal to Mannheim?
We have great contacts to regional business promotion and they’re doing a great job! When we were growing too fast in the university we were supplied great spaces in the Augustanlage. And as growth continued, the city of Mannheim connected us with the Turley conversion area, where we have found a beautiful location for our business since 2014.
How important is work space design?
A creative environment is very important. In the former Turley Barracks we have set up our offices, laboratories and think tank spaces for a transparent and cooperative workflow. Teamwork is key, but we also offer places to seclude oneself and concentrate or have a private conversation. At the moment there are two main trends: interestingly designed workplaces and, on the other hand, working from home. We try to find a balance, as we feel work should be fun.
How hard is it to find specialists in your field?
We have been benefiting from our close relationship the university. Many master’s and doctoral theses have led to valuable contacts. Sadly, the computer engineering department moved from Mannheim to Heidelberg, which made things a bit tricky. But of course we try to maintain our networks and remain present.
Is Mannheim an attractive location for your employees?
We just lost someone who wanted to move to Berlin by all means, as he loves the city so much. In that case it’s hard to compete. Mannheim has a lot to offer though and the Startup Mannheim Website is doing a great job at transporting the spirit of the city.
What is your relationship to Mannheim?
I grew up in Frankenthal and underwent training at BASF in Ludwigshafen. I studied in Heidelberg and earned my PhD in Mannheim. As of today I work in Mannheim and live in Heidelberg. The close proximity isn’t really my thing as I like to travel the world. But in the world of physics a system will function best by minimizing energy requirement. And Mannheim offers a comfortable urban landscape, with short transport routes, good infrastructure and superb transport accessibility.
How can Mannheim further improve as a „Startup-City“?
A key factor is seed-financing. To ensure this the networks must be centrally cared for, created and moderated, as contact to wealthy figures won’t just fall into your lap. I would be willing to help young founders through Active Mentoring. I will gladly bring my experience to the table if I am convinced of a good idea.
Your best advice for founders?
Talk to many potential users of the product early on! Visit conventions! There you will receive useful feedback and impulses. This is how we realized that our camera technology had the potential to open up a new field of business.
Where do you see VRmagic in five years?
The use of VR-tech is now well established in the medical field, but there is still more potential. The next big thing we are waiting to push will revolutionize medical training. In an active exchange with medical expert associations we are developing quantifiable auditing standards that will allow us to offer standardized performance tests for ophthalmologists. At the same time we wish to relieve professors by offering training curricula in a simulator, that would not be realistic in the daily hospital routine. Our newest product feature provides cloud-based software support for Faculty Free-Learning. This allows the teachers to supervise and evaluate the independent training done by students on our simulators. This will permanently change medical training.
How does one ensure dynamic growth?
At the moment our size allows us to offer secure jobs to 70 employees. The challenge will be structurally changing to allow us to reach a new level of growth and relevance. I can imagine a new round of financing that will enable us to widen our product portfolio and the scope of our business models.