How Sennheiser kept it in the family

Trying to get yourself heard in the global audio equipment market is a hard job when you're struggling against giant brands such as Beats, Sony and Bose.

But German company Sennheiser has built up an enviable reputation in the market since it was started in the aftermath of the Second World War, when Fritz Sennheiser founded Laboratorium Wennebostel in Wedemark, north of Hanover, Germany.

Laboratorium Wennebostel initially specialized in the production of tube voltmeters. Today, the company that is now known as Sennheiser is a world leader in high-end audio equipment with a turnover of 590.5 million euros in 2013 and more than 2,000 employees.

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Resolutely independent and family owned, their business is a prime example of just how big a Mittelstand business can become.

How? "It all began with my grandfather starting the company in 1945, out of nothing," Andreas Sennheiser, grandson of Fritz Sennheiser, told CNBC. Together with his brother Daniel Sennheiser, Andreas is CEO of the company that bears their family name.

"We have a global reach, we have customers in 150 countries," Daniel Sennheiser said. "At the same time, we're still rather small and [a] Mittelstand company."

Family-owned, customer centric and focusing on a niche market, the company places a huge emphasis on innovation.

"One of the core attributes, which is more attitude than a skill, is impatience and also a creative dissatisfaction with the status quo," Andreas Sennheiser said.

"Most of our people are absolutely dissatisfied with what exists, even with our own products," he added. "They continuously strive to make them better and it's not only because they think it is absolutely needed, it's an attitude, it has to be perfect. And so that really helps us to push the limits."

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For the Sennheisers, innovation and independence go hand in hand. "You can only invest in innovation more and over what makes sense on the short term if you are independent financially," Daniel said. "If you have people in the bank always looking for the fastest return, you will never invest so much into innovation and research as we do."

Would today's Sennheisers ever consider selling the company built by their grandfather? "Absolutely not, absolutely not," Daniel added. "We will not sell the company."