The Best Cities for Startups in Germany
by Bishop's Move, 24 July 2019
Both the capital city and the start-up capital of Germany, with a high quality of life and low living cost filled with strong networking and investment opportunities. The city has a population of 3.5 million and continues to attract new talent from across the globe. The diversity is also shown because there are 50% more female entrepreneurs and start up founders than any other German city.
People flock to Berlin due to its good name, as it has a global reputation for innovation, particularly within fintech. There’s a fun culture full of things to do in your downtime, and plenty of events and opportunities to meet the many bigger businesses in the area.
With so many positives, there are few cons. The main one is that international transport continues to be halted, with the airports risking delays on short trips. Also, due to the strong start up culture, there is the risk of being drowned out by the many competitors, even as that also provides the ability of collaboration.
Munich is the second most popular city for startups, there are many large corporations who have headquarters in the city, as well as plenty of venture capital moving over. Berlin is good for young entrepreneurs and creative culture, but Munich feels more mature and has more opportunities for partnerships or sales.
There is still a strong young presence, with a lot of programming talent, and many have close ties to the University of Munich, which is self-described as ‘committed to interdisciplinary education and the active promotion of promising young scientists.’ This means that there are many strong graduates who are willing to create their own start up or work alongside others.
The cons are that the cost of living is incredibly high, so you will need a higher investment amount to gain the same level of traction. Additionally, your startup may need to be slightly more established to bring in the graduate talent, as they are being pulled towards the larger corporations, who may help but also be competition.
Despite the strengths of the first two, Hamburg had the most entrepreneurs per capita in 2016, stealing the prize from Berlin. The city has been pouring a lot of resources into its opportunities for startups, resulting in nearly ten thousand companies being founded yearly. These opportunities range from networks events, government programs, advice centres and funding possibilities.
Hamburg specialises in commerce, service, tech and gaming. As a port city, entrepreneurship in commerce is the bigger sector, but the city also has the presence of tech giants such as Google and businesses such as Airbus. It is also Europe’s leader in browser-based games and free-to-play game development, with 24 companies employing over 1,500 people.
However, most of the startups in Hamburg are in their growth phase, which is catching the eye of investors but leaves newer start-ups trying to catch up to get the same level of attention. It is also becoming quite specialised in fintech and commerce, so if your start up is in another field, you may want to look elsewhere.
Whilst not a single city, this area homes many global corporations and smaller companies, particularly the Düsseldorf Region and Cologne. Over 2,500 companies operate out of Düsseldorf, so there is plenty of diversity and opportunity to network. For the German foreign trade volume, this area has approximately a 15% share, so there are plenty of international opportunities.
Cologne has over a million people and, like Berlin, is well known for its culture and commerce. It is very central in Germany and has excellent connections globally and within the country, and is leading in the fields of media and communication. There are currently over 650 start ups in the city and they are very welcoming for more.
However, most of the opportunities here are slightly spread out, so you will have to take advantage of the infrastructure to go around and meet people. There are also fewer opportunities to take advantage of, and you will have to take a more active role in engaging and learning how to grow.
Overall, Germany is a fantastic place to start up a company, with a simple visa system and plenty of people already established here. If you already speak German or know someone who does and who knows the law, then it should be as high a contender as moving to London or the Silicon Valley, especially with it’s lower costs of living. If you are looking to move to Germany, why don’t you consider using us to store your belongings as you make the trip?