Blog post
Looking back at a company that always looks forward
Allianz X CEO Dr. Nazim Cetin in an interview on how the coronavirus has driven digitalization, why he is happy with Allianz X’s year, and whether Germany can keep up with tech innovation
Nazim, as the year draws to a close, it’s time to look back. How was 2021 for Allianz X?
Nazim Cetin: It was a strenuous year, especially because of the coronavirus. Our business is a people business, based on togetherness and interaction, which is difficult in these times. But we’ve found ways and developed well — business-wise and personally.
What have you achieved?
NC: For example, we invested in WeLab, a digital financial services provider in Hong Kong, we further expanded our partnership with Pie Insurance, a digital company that does workers’ comp insurance for SMEs in the U.S., and we completed the integration of finanzen Group into Clark as part of an equity swap, creating a unicorn in the process — it was a unique deal. But that’s not all we’ve achieved this year: We invested in Stripe, heycar, Purpose Financial, and acquired GT Motive. The team has done a super job. And by team, I mean both the Allianz X and Allianz SE colleagues. Because without our friends and colleagues at headquarters, we wouldn’t have been able to achieve all this. It was a very good year for all of us. So now we can relax, enjoy the holidays, and recharge our batteries.
Do you ever turn off your phone over Christmas and New Year’s?
NC: That’s a bit difficult. But we’ll at least shut up shop from Christmas to New Year’s Day.
Are you a workaholic?
NC: That depends on who you ask.
How would your family respond to that question?
NC: They would definitely say yes (laughs).
You founded the philosophy magazine “agora42.” What’s the philosophy behind Allianz X?
NC: Allianz X is a wholly owned subsidiary of Allianz SE. We are responsible for its investments in digital companies. Our philosophy from the very beginning has been to be a trustworthy, forward-looking investor and partner — both for the companies we invest in and for our colleagues in the many Allianz companies around the world. We help identify trends, shape industry developments, and play an active role in the Group’s transformation. Or, simply put, we get things done!
What does the “X” in Allianz X actually stand for?
NC: It’s always been there and isn’t an invention of mine. Maybe it was branded in foresight of us having the X factor one day (laughs)?
What added value does Allianz X provide to the parent company?
NC: A good return on investment. And we know our way around the digital space. We have developed a feel for real innovation. Tech up-and-comers often sell themselves as the next Google or Netflix, but they’re usually not. That’s where our expertise comes in: it’s our job to assess which companies are pursuing a promising business model — and which are not.
And what does Allianz provide you?
NC: You might think that Allianz only provides financial backing, but you’d be wrong. After all, there is plenty of capital on the market. So far, however, no company has slammed the door in our face, and there’s a simple reason for that: Allianz is a global brand, active in 70 countries, and it has an excellent reputation. That is the great foundation upon which we start our work.
How do you recognize a good business model?
NC: We always ask ourselves, “What problem is the product solving? And does the problem even exist?” If the problem exists and the company has a good solution for it, then we ask ourselves, “What if?”
What does the Allianz X team look like?
NC: We have a very young and diverse team. The average age is 33. Our 42 employees — including interns — come from 21 different nations and speak 16 different languages. In our day-to-day work, we communicate in English.
Are there any special challenges that come with such an international workforce?
NC: No, quite the opposite. It is very enriching. You should see the sweets and goodies that have graced the counter in our office kitchen! Brazilian coffee, Turkish baklava, mangos from Thailand, Italian wine: specialties from all over the world (laughs). Jokes aside, though, our diversity strengthens us. Different points of view, experiences, and approaches move us forward. But it’s not easy to get a job here. We get about 1,000 applications a year, so we can be very selective.
Allianz X invests in tech companies. The pandemic has revealed that Germany is lagging behind in terms of digitalization. To what extent has the coronavirus changed the industry?
NC: Failures were exposed, no question about it! Especially in the field of education. I saw that firsthand with my children doing distance-learning from home. On the other hand, the pandemic has also driven digitalization forward in many dimensions. Take for example cashless payment and the fact that digital products and channels are now being adopted across generations. I can see that in the case of my father-in-law, for example. A few years ago, he still considered a tablet computer to be the devil’s plaything. Since the pandemic, however, he has been using it to read the news, order meals, and more. Nowadays, he and his iPad are inseparable.
After Klarna, PayPal, and Netflix, what innovations are still to come in the next few years?
NC: To be quite honest, I’m wary of making such predictions. I think it was the head of the U.S. Patent Office (editor’s note: Charles Holland Duell) who is supposed to have said, back in the early 20th century, “Everything that can be invented has been invented.” Obviously, he was profoundly wrong. With the opportunities today and the necessities caused by the past, I am convinced that we will see fantastic innovations in areas such as, for example, green tech.
Can the German tech market keep up with this development?
NC: We definitely have the potential to keep up. But yes, maybe we in Germany are more the maintainers and naysayers. Sometimes we fall short a little when it comes to courage, curiosity, and, of course, being open to risk. And by that I don’t mean blindly taking every risk. You have to weigh things carefully. When you ask yourself, “what if?”, put the topics that could go wrong in relation to the opportunities and build a balanced risk-reward profile. I don’t think Google would have had a chance in Germany.
Why not?
NC: I am convinced that Facebook, Netflix, Amazon and the like also knocked on doors in Germany in their early stages. And I can vividly imagine how the talks went back then: Are you profitable? Are you making money? No? Then finish your coffee and watch the door doesn’t hit your ass on the way out.
How do you explain that?
NC: I think human brains just find it hard to grasp exponential growth. The coronavirus pandemic also showed that. Some people look skeptically at the high valuations of digital companies, but they forget that what you pay for it today will be worth twice as much in a year’s time because the company has grown by 100 percent.
Is this phenomenon perhaps also related to the tech industry itself, which, to some, is too abstract and intangible?
NC: I don’t think so. But in this context, many people like to refer to the dot-com bubble at the beginning of 2000. First came the boom, then the bust. And yes, there will always be course corrections in the future. But quite honestly, these will not cause any of us to go back to listening to music on audiocassettes or booking vacations exclusively through travel agencies. We’re in a phase of innovation right now, and there’s a lot more to come. Customers are already embracing that. In Germany, it’s more likely that investors will have to rethink their approach. Now we have the chance to shape things not only here in Germany, but also elsewhere.
How open to risk are you personally?
NC: I don’t have any crazy, dangerous hobbies, if that’s what you mean.
And when it comes to private investment?
NC: Honestly, my wife manages our portfolio. It’s a good mix of stocks, real estate, and pension products.
At Allianz X, you have over 2 billion euros worth of assets under management. How does it feel to handle so much money?
NC: Well, it’s not my money (laughs). In all seriousness, though, I feel honored by the confidence and trust Allianz has in us. And, of course, I am also happy that we’ve been able to grow convincingly what was given to us and thus fulfill the expectations that were placed in us. That’s also how we would like to continue.
What do you expect from 2022?
NC: Naturally, I hope that we will be even more successful next year. It’s time to take Allianz X to the next level. The standards we have for the companies we work with must also apply to us: The market is growing, and we have to do the same.
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