In this series we explore some of the world’s most successful tech hotspots, examine how they came to be, and look at what the future holds for these pinnacles of innovation.
It is said that a new start-up business is born in Berlin, Germany’s capital city, every 20 minutes. For many years Berlin has been one of the most highly talked about startup hubs in Europe, with many experts suggesting that it has the potential to rival Cambridge’s ‘Silicon Fen’. Some have gone further and dubbed it ‘Silicon Allee’ – A new space for the Berlin startup community to live, work and connect. A website is coming soon, but for now check-out Silicon Allee on Facebook.
Berlin has an open attitude towards tech and is not scared to try new ideas and different ways of doing. It is an exciting and vibrant place to be right now, with a rich culture that has attracted thousands of creative entrepreneurs from across the globe. Now they’ve moved in and begun to churn out all sorts of exciting innovations including big data, cloud, e-commerce and business-to-consumer solutions. Some of Berlin’s top startups to date include: Zalando, Wooga, SoundCloud, Eyeem, Gidsy and Delivery Hero. The young tech hub is already proving to be a strong player in digital media, social games and the quirky end of the consumer web.
The dominant tech force in the city is the three Samwer brothers – the proud founders of Rocket Internet. The company is best known for building many highly successful startups and has already set up dozens of online marketplaces covering everything from fashion to meal delivery services. The majority of the company’s value lies in their 10 most mature companies, which they have labelled as “proven winners”. These companies were said to have a combined value of over 3.43 billion euros in June 2015.
In terms of growth, Rocket Internet aids the city’s startups by providing office space to new companies within its Berlin headquarters, offering these businesses IT support, marketing services and access to investors. So far they have helped launch more than 75 companies, including: Zalando, the Zappos of Europe, Lazada and the Amazon.com of Indonesia – the Samwer brothers are always happy to fund aggressive businesses in proven markets.
Google are one of the big names within the private sector that have shown their support towards Berlin’s tech startups. Although the company’s German headquarters are situated in Hamburg, a great deal of Google’s efforts are being focused on Berlin. Recently, the ‘Google for Entrepreneurs’ programme assisted in the opening of ‘The Factory’. Housed inside a renovated brewery, The Factory is a multipurpose work space created to help the city’s tech startups thrive. Google’s big tech rival Microsoft, also run an accelerator programme designed to help develop Berlin-based startups.
Berlin is known to be home to a diverse tech community which is made up of members from all over the world, providing the city with a unique blend of creative talent which is perfectly aligned to the next generation of technology that focuses on people first.
What draws so many tech professionals to Berlin?
Not only does the city offer a strong foundation in terms of capital and tech support for startups to grow, it also boasts staggeringly low rent compared to other European tech hubs. Let’s take London for example, the average rent is over three times the price of an apartment in the centre of Berlin. On average a city centre flat in London will cost you £1,629 per month, whereas in Berlin it will only set you back £454 a month. This makes the city an incredibly attractive option for young professionals who are as equally drawn to the city for its low rent and flourishing tech scene as they are for its rich culture and exciting nightlife. Similarly, the low cost of rent also applies to office space, making Berlin an attractive option for businesses owners as well.
The reduced cost of living allows these young professionals to enjoy a more comfortable lifestyle than they would elsewhere. German visas are also known to be easier to come by for non-EU citizens after the initial three-month travel visa expires, this is also said to encourage many workers to relocate to Berlin.
The future looks promising for Berlin, recent research conducted by McKinsey reveals Berlin startups could generate 100,000 jobs by the year 2020. With financial opportunities from overseas gearing up, there are plenty of corporations rushing to swoop on the growing startup scene, including Microsoft who bought the personal planning software firm 6Wunderkinder in June 2015.
Berlin’s dynamic and innovative environment is catching the eye of investors around the world, we can only wait and watch with keen interest to see if this emerging tech hotspot goes super stella.
By Roger Mills, Co-founder of Think IT Recruitment.
As always, if there’s anything in this article you would like to discuss, please start a conversation or get in touch with me.