How to Build One of Europe's Largest Mobility Providers - with Flix Founder Daniel Krauss

Yes, greetings, Nicolas. Very, very gladly. Many thanks for the invitation.

Yes, that hits the mark quite well. The numbers are from 2025. I hope that this year we will be able to transport over 100 million people and the revenue has also grown a bit, but since we are not yet publicly listed, we are a bit stingy with the publications. So that's fine and it's exactly right. In addition, we look at how we can support the German founder and corporate culture across various dimensions. And it's not just about startups and investing, but above all about education. I believe that is what is actually relevant to permanently advance a society.

No, we had prepared for a possible IPO and then it was preempted by EQT. That's a Swedish private equity house, the largest in Europe, and the Kühne Holding, the holding of Klaus-Michael Kühne and Kühne+Nagel. Top investors, very long-term oriented. We are very happy with them. And that's where we are now. Can you rule it out forever? No, certainly not. Given our size and the nature of our company, it's not a topic in the short term either, because as you already said, we are profitable and cash flow positive, have good long-term oriented investors. We can thankfully focus mainly on the business. That is still international expansion, to be able to serve even more people with green mobility all over the globe. And in Germany, that is primarily FlixTrain. That is already the most important strategic project we are driving forward.

In expansion, we last started Australia. Peru is about to start and then we have to keep looking. It's always a bit driven, above all by where we can establish our business model. You have to do some regulatory groundwork there, cultivate political relationships, because not every country allows it yet, like for example most European countries. Although even in Europe, Spain for example, there are still exceptions, we can't operate there the way we want yet. So there's still quite a bit on the list. Growth markets are currently primarily Great Britain, India, Mexico. There is a very high dynamic, it's really fun. And as you said, we have ordered about 60 trains for around two and a half billion and we expect them to be delivered in 2028. And then successively put into service, so to speak. And with that, we would then rise to become the largest private train operator in Europe between 2028 and 2030. And we believe that in Germany, but also beyond in Europe, the long-distance train business a) complements the long-distance bus business very well and b) the market for long-distance trains in Europe is even larger than that for buses. That doesn't apply everywhere, it's different in North America, but in Europe the market for long-distance trains is larger than for buses.

I think asset-light asset-heavy is a very black-and-white view. We call it asset-right internally, so to speak, which makes sense. If we had had the opportunity, we probably would have, because we have good experiences with it, also continued to operate the trains in this partner model, with mobility partners, without us having bought the trains ourselves. But there just aren't enough large players in the train market that have the strength for both the operational business and the financial power to buy something like that. Trains are much more expensive than buses. You're talking about ten times as much and more. And that's why we came to the conclusion that if we want to grow really fast, we have to get involved ourselves. And not just regarding the investment, but above all the operation. You can see in other platform models, or as we call ourselves a travel tech, that things are changing. For example, with Uber and Uber Eats and then some shadow kitchens or whatever they call them, or now with the acquisition of Delivery Hero, there are then also assets to ensure that delivery is as good and fast as possible. You see something similar with Airbnb, that they are getting into it, where such models originally come from. Also in the hotel industry, there are many who then give out the operating licenses, but only keep the brand and customer acquisition and the platform, but also own some properties themselves. So depending on what the optimal portfolio mix is. Hilton is a classic example. And that's how we positioned and balanced ourselves accordingly, because otherwise we would have simply had to forgo the train market in that dimension.

Yes, good question. So, what did I want to do? I believe the two big guidelines, technology and people, people in the context of organizations, those were things I always wanted to do. I believe I have a certain knack or would say talent for it, like an athlete. And although that always goes hand in hand. I believe if you have talent and it's fun, then you have a high chance of becoming good at something. If you are perhaps talentless, you can train a lot, but you probably still won't become the best soccer player in the world. And that's why I have the privilege of being able to work in areas that have always been fun for me. And that is now, funny enough, not the completely obvious mix. So I don't even know if I had been an employed managing director or board member somewhere, if it would have turned out that way or if I would have had to decide somewhere. But this way, I could simply build it in my own company together with Andre and Jochen so that it fits. And the topic of entrepreneurship as such. I was always a bit non-conformist and enjoyed swimming against the current and had one or two challenges with authority, when things were demanded of me without good reason, whether in school or in employment, and it wasn't cleanly justified or didn't seem sensible to me or was sometimes just plain stupid. That caused me a bit of physical pain and breaking out of that was, I believe, without me being able to explicitly do it back then, already some kind of life imperative for me and that's why it was actually an easy feeling to slip into entrepreneurship.

Well, a company is a business event, to quote Heister, and entrepreneurs are characterized by the fact that they do something, right? That's basically a kind of eternal flame and that's why most of them go bust or many old ones can't actually let go or if you sell a company, you immediately start founding something new. They are all a bit under constant tension. That means the question of whether I have to do it has never arisen for me. It's about, do I want to do it, is it still fun for me. I believe I still have enough impact, both within the company and together with the companies on the market or in the context or field you are active in. And as long as I can still rate that positively and say, okay, there's still more to do, then I just keep doing it because it's fun. And even if at some point the company says, that's enough now, Daniel. Move on. Then I would have to find something else, because I believe anyone who claims that is not part of the identity, and it's even more special for founders, but also in general, a job is always part of the identity, right? That's the merit you get when you perform, right? The feedback, the appreciation, that's why I don't believe in it, looking to the future, regarding this UBI topic and when people say, yes, everyone gets unconditional basic income, it'll be fine. That doesn't do the math. And that's why I've never really dealt with it particularly intensively. And the question of why I continue is A, because it's still a lot of fun for me and B, because I believe there is still a lot to do, as I said, for me together with my colleagues within Flix and for Flix in general out there in the market. There are still more customers who absolutely need to be served.

Well, what really felt crazy was when we had the privilege of taking over Greyhound. For various reasons. A, it's an iconic brand that everyone has seen on TV or on a screen. B, when we thought about founding Flix, you always look there, who invented it, so to speak. And sometimes I felt like the Fritz-Cola founder who now quickly takes over Coca-Cola. So that was a very special moment, how we were welcomed there in the USA. I think that went quite well. It was also particularly quirky because when we flew over to sign, it was still COVID. That means we needed all kinds of special permits. I first had to argue at the Nuremberg airport because the special permit was nothing more than an email from the embassy and they didn't want to let me travel at first. It started quite quirky and then I sat on some regional plane to Dallas, I don't even remember anymore if from Washington or Denver. Anyway, there was a guy next to me who said, and you say, yes, we're flying to Dallas. He says, okay, what do you do? What is a German doing in Dallas? I say, yes, I'm there, I do buses and so on. And then he says, oh yeah, something like Greyhound? I say, yes, honestly, I'm currently on my way to Dallas to buy Greyhound. And then he was like, how can you buy that? And then we chatted a bit. He didn't even know that before we took it over, it was run by the British group, or not run, but owned by the British group and not really American anymore, operationally yes, but not in terms of shareholding structure. And exactly, and then we closed the deal in Dallas. As I said, it was a very special moment because it's a very special company and it made us very proud. And as I said, when you are on eye level with your idol at some point, that's a good story. It was then anyway a quite funny trip, because to top it off, we are three Franconians, Jochen, Andre and I. Jochen is from Lower Franconia. Nobody's perfect, I always say. Andre and I are from near Nuremberg. And when we were there in the USA, Jochen said, you know what? Let me see if I can somehow get a contact to Dirk Nowitzki, maybe we can meet him there, because of Franconia and so on. And I don't know if he did it via Instagram or something. I don't know, I've already forgotten, but actually we had contact to Dirk a day later and he said, no, sure, hey, that's cool, hey, if a few Franconians are here who want to buy Greyhound, and then he invited us to his office for coffee. And your colleague just wrote to him on Instagram: 'Hey Dirk, let's meet up.' I can't say if it was exactly that, I would have to ask, if it was social media or if he knew someone from Würzburg, because both are from that area, somehow his management or something. I can't recapitulate that exactly anymore, but I remember that I was then at Dirk's in his quite modest mansion and the four Franconians talked about what a Franconian footprint in Dallas could look like, so to speak.

No, no, no, no, no. I don't think world star at all. In the end, they were all curious, because of course they had looked into us a bit. We were already present in the USA before, they knew we were competitors and then they also knew that Jochen, Andre and I had founded the company. And entrepreneurship is viewed very differently in the USA than in Germany. That means you have a bit of respect, but above all a lot of curiosity, in some places also a bit of uncertainty, okay, what's coming now, so to speak, when the new owners move in. And in the end, it always depends a lot on how you interact with people at the beginning. And I believe we were well advised, above all to show a lot of respect, and then a very fruitful business relationship developed from that.

You have to separate that, right? So Flix as a company, it runs exactly as you described. We have to be profitable and want to grow profitably. Why? It's a question of independence from banks and other third parties. And what we then do is, we invest exactly as you said, this profitability, our profit into further growth, because when you go into a new country, you are rarely profitable right at the beginning. There are countries where we had a really great start recently in Australia, that's going great, but normally you have to allow about three years until you really make money there. And that's an investment and for that you need other countries that finance it at the beginning, right? Very clearly. And that's how we think about investments at Flix or the FlixTrain topic. And then it's like this, that Jochen, Andre and I also have our family office in parallel, the Flix Founders. And we also make other investments there in startups, also in funds and of course also in the public market, stocks and similar things. But that is so to speak our private money, which has nothing more to do with Flix.

We have learned and rely on the fact that the three of us always make very good decisions, even better than any of us alone. That means, we also discuss the things we decide on always as a trio. 100% trust, 100% transparency and then we say yes, it's cool. And normally it's like this, it happens very rarely, but you could also decide two to one. That's the beauty of democracy when you have an odd number of founders. And exactly, and then we discuss everything, decide it and then we do it. And we have always done well with that, doing it as a team. There are then of course priorities, Jochen is more engaged in this investment topic than Andre and I, because we are still operationally board members at Flix. That means, sometimes Jochen just informs and acts, because he also has the mandate accordingly. But especially the big things, we discuss them as a trio and then decide them as a trio.

Yes, well, everything is not the whole world, of course, but everything that comes under our wings or falls into our arms. For us, it is crucial that we understand the market and consider it big enough. It simply has to be a big market, because the challenge is, let's say, this is a great product, a super idea and everything is great, but the market, just you and me, is relatively quickly saturated and then no matter how great everything else is, it just doesn't go further. That means the market and the market potential are one of the two most decisive factors for us. And the second most decisive factor is the team, the founder or founders. Why? Because the idea itself, the service, you can pivot that if necessary. But if the market is there, in the end it depends on so many different things. You sometimes say execution, right? But you have to have the endurance and skills of the sprinter, as well as those of the marathon runner. And it has to be mixed very well if it's a team. And that means the founding team and which person is sitting opposite us is, next to the market assessment, the second most decisive factor. Yes, then in third place comes the actual idea and service or whatever it's about. But I find, as I said, market and team are even more important than the idea as such, if you simplify it. Okay. So market size, market potential, founding team and the idea.