This right in advance: This contribution is first of all personal and then also political. In 2013, I made a Angelinvest into a founding team that had a very cool product idea and which gave me the impression that it was deeply convinced of its idea. The product was called Papayer and was basically a Teenager Debitcard with an app that could also be viewed by parents. Since the topic “card” was on the agenda of my two older daughters, it was a perfect fit! Papayer worked too, but didn’t scale properly. What did the two founders Valentin and Max? Instead of giving up, they did a pivot and developed their vision of an “adult bank” that is just a smartphone app. A lot of people smiled at this idea and some even smiled at me. Two angel investors got out at the same time with a nice return on investment – I followed up, because since 2000 – the times of Paybox and Payitmobile – I am an absolute fan of mobile payment. And mobile banking is the logical consequence of the introduction of smartphones!

The rest of the story is well-known: Papayer became Number 26, now N26. Since receiving my banking license in 2016, I have been a member of the advisory board of N26 Bank and have a different insight into the development of this company, which many (media) and probably not always with the best ulterior motives only look at from the outside.

On 22 March, the state governments impose exit restrictions due to the corona pandemic – the economy comes to a virtual standstill. The federal government unpacks the “bazooka” and flanked by, among other things, relief for short-time work. This instrument is not only used by thousands of (smaller) companies in Germany, but also by the well-known DAX stocks. Since the end of April, almost every third company has announced short-time working. N26 is also introducing this instrument for part (just under 10%) of its workforce (most of them stayed on board with 60-80% of their working hours). In the media financial scene, however, the impression is created that N26 are the only ones, as every “leading” business paper reports on it. The fact that start-ups are also feeling the effects of the pandemic and may be hit even harder than companies that are already profitable is deliberately ignored.

man in black suit holding white iphone 5
N26 under fire (photo by CardMapr)

On August 13th I get an exclusive message from @financefwd via Twitter: N26, works council, interim injunction, picture of Max and Valentin. There was probably an “informal news-feed” for Finance Forward – fair enough. The next day I meet Max for a longer planned update in Berlin – perfect timing to discuss this topic as well. At the same time, the topic “Works Council at N26” is gaining momentum in the (social) media, which can only be explained by the fact that the tempers heated up by the scorching heat outside are obviously only promising cooling by sending tweets, articles and comments in the non-existent payment summer slump at a high rate. Today, this is known as “lived media democracy” or in new German “Shitstorm”.

So Maik Klotz, last not (yet) “Deutschbanker” and thus “last man standing” of the PaymentandBanking team (Note of the wheel actionthere are some non-German bankers at Payment & Banking – Nicole Nitsche, Christina Casalla, Julia Tschawdarow or Miriam Wohlfarth as well as many freelancers), packs the big moral club of and accuses the N26 team of “lack of social responsibility” and challenges me via Twitter…here my answer to that:

If Maik heard the story of the “NEINhorn“then N26 is a NO horn in the best sense of the word: the two founders have said “no” to the way banking has always been practiced by our parents and are now rightly questioning a formalized employee representation based on a legal regulation dating back to the 1970s. It is not to be blamed on the two founders, who seized the opportunities offered by digitisation in a sector that had (consciously) ignored the changeover to modern technology for many years, and who developed a vision into an innovative business idea, for questioning this approach and coming up with their own idea for it;

In my opinion, it is a legitimate question whether the structures of the German Works Constitution Act (BetrVG) of 1972 meet the requirements of a digital economy and start-ups with disruptive business models and the associated agility. Not that we are misunderstanding ourselves here: Start-ups are not lawless areas and employees are not completely without protection. It is rather a question of how these topics can be implemented in a modern way;

For the very few who now rise above N26 in the social media are themselves working in a works council-regulated company.

Marcus Mosen

Because very few of those who now rise above N26 in the social media work in a works council-regulated company themselves and/or know the processes involved from their own experience. The work of a works council is first and foremost a highly formal one, which in practice requires a great deal of paperwork, but not a creative one. Here the principle “only those who write will stay” still prevails. And the more formal the parties (have to) meet each other, the less flexible the way they deal with each other. The principle of “trustful cooperation”, which is inherent in the law, does not change this. What exactly this is supposed to look like and how to live it in compliance with the flood of detailed regulations has been the subject of the work of hosts of lawyers and the labour courts for years. So whatever the driving forces behind the initiators of the works council election, they will probably not be able to implement their ideas promptly and smoothly. &nbsp

Founder & CEO Valentin has publicly apologized via LinkedIn for the “escalation” of events last week. And who knows him knows that he means it.

– Marcus Mosen

So if N26 employees now want to set up a works council, they have every right to do so – also with the help of trade unions. The fact that they are making themselves the focus of media attention is not only due to their support for the formation of an election committee. Ver.di is struggling with declining income due to declining membership and various changes in the (financial) services sector. In addition, many members are no longer able to pay union dues due to wage losses during short-time work. It is not surprising that people are now trying to get their foot in the door of the most prominent FinTech company. And also not the reflex-like protection help of politicians like Esken, Klingbeil, Scholz and Co – only one should always consider here whether these Tweets are really a credit to one, as one knows from the recent past at the “charming” handling of the three aforementioned SPD-grands among themselves… &nbsp

Valentin Stalf at a meeting with Marcus Mosen

When the founders Max and Valentin now put forward an alternative proposal for a tailor-made company concept for representing the interests of N26 employees abroad, it was clear that the works council initiators with the trade unions supporting them would dismiss this as a diversionary tactic. However, it is the right and also the responsibility of entrepreneurial action when founders today not only think about a model of co-determination in the 21st century, but also make corresponding proposals to the entire workforce. In this specific case, the founders even go beyond the scope of individual employee groups and propose a platform that not only takes into account the interests of some, but those of the entire company – which currently employs a significant number of employees in four different countries. Employee rights and opportunities for participation, especially with a global promise, can perhaps even be better developed with this than if they were prescribed by a law dating from the 1970s.

Anyone who assumes that N26, which has grown strongly in its workforce over the past three years, lacks social responsibility, has not yet seen and experienced the company in Berlin from the inside. Everyone can decide for themselves whether they want to work there or not. There is no compulsory employment in Germany! For many, N26 is a company that until a few years ago was only known from Silicon Valley – agile, techi, diverse. And if one or the other now thinks he or she has to say something negative about N26 and its management, and even calls it “Asshole Bench”This means that a company owes its generous, secure income either to the compulsory state broadcasting fees, contributions from low-income members or to our tax money, and has never before been involved in such an entrepreneurial responsibility in which there is not always just one way forward;

For if you look at the trade unions’ track record in entrepreneurial activity, the billion-dollar bankruptcies of the trade union companies Coop and Neue Heimat and the Bank für Gemeinwirtschaft immediately come to mind And politicians have not shown a lucky hand either as shareholders at Commerzbank or, most recently, in the supervision at Wirecard.

Founder & CEO Valentin has publicly apologized via LinkedIn for the “escalation” of events last week. And who knows him knows that he means it. The learning curves have been steep for many in the last few days, and the comments have been below the belt at times. We want to apologize for the boredom and/or the heat in the home office;

For me, N26 is not just an investment, but a conviction for banking in an increasingly digital world. Granted, if I had invested my money in Deutsche Bank shares in 2013, the value would have shrunk by 75% today, not to mention Wirecard. Perhaps, at some point in time, one can buy N26 shares. In any case, it would be good for Germany as a (FinTech) location and also for the more than 1500 employees who will probably be working there by then.

The N26 BR-Wahl-Shitstorm has certainly pleased many again. For me it is a new lesson that you should definitely not only draw your opinion from tweets and other social media. Even though we know since #Trump and #FakeNews that you can do “big” politics with little effort and smash a lot of china