“Poor but sexy”, the infamous Berlin tagline coined by ex-mayor of Berlin, Klaus Wowereit. The city has come a long way in the past decade transforming its reputation to become the “Silicon Valley” of Europe.
Berlin’s start-up scene is growing at an incredible rate showing no signs of slowing down. Berlin solidified itself as the champion of Germany’s start-up scene in 2017. Venture capitalists invested a total of €4.3 billion into German start-ups with 58% of the investment going to start-ups in Berlin. A total of 233 rounds of financing raised €2.67 billion for Berlin start-ups, putting it just behind London and on par with Paris.
8 out of the 10 most desirable start-ups in Germany are located in Berlin with an estimated 30% of the nation’s start-ups setting up in the city. Berlin has clearly established itself as the prime start-up location in Europe. This can be attributed to a number of influencing factors:
International Talent Pool
Berlin boasts a highly diverse population with approximately 20% of the city’s residents coming from overseas. This multinational, highly educated workforce breeds creativity and innovation.
Infrastructure
The city operates a very efficient and affordable public transportation network that is fully integrated. It’s quick and easy to get to anywhere in the city or further afield thanks to the city’s expansive train network and two international airports. Office space is reasonably priced compared to other EU cities facilitating the rise of numerous co-working spaces enabling start-ups to get off the ground.
Investment Climate
Berlin is home to numerous start-up incubators and centres that help turn innovative ideas into reality. Furthermore, venture capital funding has been increasing year on year providing financial support to start-ups throughout the city.
Vibrant City
Berlin has a special, non-conformist culture that cannot be found anywhere else in the world. The city is steeped in rich history and has since grown to become one of the most unique urban areas in the world. The city’s vast party spectrum has something for everyone from industrial techno temples to up-market cocktail bars and beer gardens. The result, Berlin attracts all walks of life, each bringing their own skills, creativity and resources to the capital.
Rent Prices
Rent prices in Berlin are much cheaper compared to its EU counterparts such as Paris and London. This lower cost of living has attracted multinationals from around the world to start-up businesses while enticing highly skilled workers to relocate.
Success Stories
Berlin start-up scene has an impressive track record producing some remarkable “unicorns” in recent years:
N26
The German Direct Bank, founded in 2013, has scaled to become a recognised name in the finance game valued at an astounding €2.7 billion as of 2018.
Zalando
This e-commerce company, founded in 2008, now employs over 15,000 people, operating in 17 countries posting healthy revenues of €5 billion as of 2018.
HelloFresh
The number one meal-kit company in the world, founded in 2011 went public in 2017 with a sizeable IPO valuation of €2.7 billion.
Delivery Hero
The online food-delivery service, founded in 2011, now operates in 40+ countries and was valued at €4.5 billion during its IPO in 2017.
Posted by Adam Dunne on 7 February 2019
