Why Berlin is poised to be Europe’s new tech hub

33 thoughts on “Why Berlin is poised to be Europe’s new tech hub”

  1. Hi Om, great article. I recently visited Berlin for the first time in 20 years, and there is indeed an electricity and vibrance in the air there. There’s an “anything goes” attitude which could well help it rise up in a variety of arenas, particularly with its embrace of the arts. Here’s hoping it happens!

  2. Berlin is solid..amazing tech scene! Super diverse and smart people. I go there quarterly for work and I am always impressed. I think the Samwer brothers had a lot to do with getting things going here!
    Alando sold to Ebay
    Jamba sold to Verisign then fox
    and invested in a ton of major start ups like City Deal bought by Groupon ..

  3. I agree, I actually did go to Berlin in the summer to strike a collaboration between a German and Indian startup in the foodservices space. The energy was palpable, the lower rents on the East side of the city allow for large loft-like spaces for operations, which would not be available elsewhere.
    There are some larger tech companies such as those by the Samwar brothers who’s Cloning has reaped enough reward to setup large ops in Berlin. While they’re clearly not the hub of innovation, they have allowed more talent to come to Berlin and given them a platform to work – now the smart guys who get disenchanted w these guys would at least have a network to startup their own stuff there.
    Fascinating place also in that a lot of innovative nordic and scandanavian folks are coming down as well as highly skilled techies from other parts of eastern europe. Collective upliftment of these people coming in as well as increased consumption in the city bodes well for Berlin.

  4. Hi Om,
    you said quote: “Berlin’s Tegel Airport reminds me of another airport from my childhood in India.”
    I live myself in Berlin, and you have forget to mentioned that Tegel is
    1) one of the three Berlin airports.
    2) the smalest of the Berlin airports.
    3) the oldest, too
    4) that its very within the city (and can hardly expendet)
    5) and that its also allready planned and decided to give this airport up and transfair it to Schönefeld (biggest and newest .. and at the citylimits)
    6) since it was decided to give it up, the visitor terminals are not modernernised (?,updated?, renewed?, … havent a good translation at hand of what i want to say) anymore
    7) but, and thats the only reason why its still up, that it is very popular, because you land in the central of the city.

    The three airports of Berlin are: Tegel, Tempelhof, Schönefeld.

    A final word or two about Berlin. Berlin is one of the biggest citys in Germany. Compaired to Munich, wich claims itself as a world city (metropolis?, cosmopolitan city?), Berlin is huge.

    … here I was writing something about the size compaired to other international known citys (which I never had visited) and while I was recherching on the internet for hard facts (which I can’t make me remeber) I got that I was mixing up the State (which is nearly about the half size of Germany) and the City of New York (which is a tad smaller than Berlin).

    State New York (141,300 km²), Germany (357,111.91 km²),City of New York (1,214.4km², but only 789.4 km² land, the rest is water), Berlin(891.85 km², almost everything is land).[source language=”wikipedia”][/source]

    Somehow I got off topic…

    1. Off topic, maybe… but to get things straight, I think you’re taking “size” a bit too literally. Nobody really thinks about a city’s impact in terms of its geographical area: otherwise we’d be talking about Ankara or London or Rome here, which all cover much more square mileage than Berlin.

      More accurately, perhaps, is to think about cities in population terms. In this scale Berlin a big city, but not a huge one. If you’re looking for comparisons to urban New York (nearly 20 million people) or Paris (10 million) or Greater London (8 million+) to Berlin (3.5-4 million) then you probably get a better idea of what Om means here.

      Also while we’re here, on the airport front: I’m surprised as a Berlin resident that you don’t know that currently Berlin *doesn’t* have three airports, it has two (Tempelhof closed down in 2008, if you hadn’t noticed). Tegel and Schonefeld are both crap by any international standards, but yes, they are all being rolled into the new BER over the next year. I’m not putting words into Om’s mouth here, but a city signals its intentions and ambitions from the moment an international traveller steps off the plane: maybe the new Berlin-Brandenburg airport will do a better job of that!

    2. Ahh… Tempelhof (of Berlin Airlift fame) was a huge airport but it’s closed and now a public park. So strange to list it as one of the three Berlin airports.

      Both Tegel and Schonefeld are smallish airports; the latter seems to deal mostly with cut-price airlines like Ryanair so it’s certainly reasonable to say that Tegel is the main airport. While Tegel is small I personally like that about it. The future is no doubt something much bigger, but I for one will miss it’s charms.

  5. Very good report on the Berlin tech scene, that should just give a short plug to rocket internet, who are – for very good reasons – not popular with many, but indeed this “big company … that employs hundreds (if not thousands) of people.”

    Groupon (formerly citydeal) Germany runs all of Groupons international operations and further expansion, Zalando heads an e-commerce operation that’s growing much quicker into a truely global shoe and fashion-empire, bigger than Zappon can ever be and these and many more are all born inside the rocket internet offices in Berlin…

    Cheers from the ‘Silicon Cape’ in South Africa (Cape Town)
    Randolf Jorberg 🙂

  6. Om is right to cite the importance of a large and supportive domestic audience in order to take a product globally. Europeans often list having to think ‘international from day one’ as an advantage for startups based here, but I can think of many startups that leverage the US market to go global but few that do the same from a Euro-start.

  7. To be honest the Thing that attracted all of these startups is the huge pile of money the city is spending to geht them to Berlin… And the fact that costs of living, rent and wages are ridicioulusly low compared to any German city, most of which also have better infrastructure

    1. Mirco

      If you ask SoundCloud then you know that is not true. The city wasn’t spending any money to attract anyone at that time. And frankly they should be spending money on Berlin and improving its attractiveness to tech infrastructure.

  8. For only having spent such a short amount of time there, this is a great post, thanks. 😉

    You point on maybe needing a local market goes two ways. Yes, if you have a startup which relies on a local user base, US companies are more of an advantage. But for everything else? Most of the international minded startups I encounter don’t go for a local market, they go for “worldwide” which is different to what Brendan is pointing at: If you start in German with German mindset and German customer base you fall into the same trap as starting with an American market.

    Most US startups do cater *too much* to the local market thus alienating international users / buyers. As I like to say “my credit card pays world wide”. A whole lot of US based startups and services could easily attract worldwide customers from the get go, but can’t because they are build with a “we go international later” mindset.

    You are a mobile app? Then upload your app worldwide, I do speak english fine, thank you. You require me to enter an address? Do realize that international addresses are formatted differently (I do have a fake US address for that). You use selections for date and time? By telling you I am from Germany I already told you that I use the 24h system and my week starts on monday. And I separate my numbers by , not by point and if I would by a fitness tracking devise, I want km and not miles.

    It starts with basics and if you build your startup without the foundation of international, you will have to add it later at a much higher cost which will delay you.

    And again that is the benefit of many of Berlin startups: They build with the international mindset, in English first and then go on for the European market as a user base. By catering to their needs and giving them the attention the US startups neglected to do, they can gain their user base. How about those influences? There is a strong feedback loop with silicon valley which is why you go for the influences like a US startup and make your visits; then use the attention of the US based influences to come back to Europe.

    All in all: looking forward to your next visit. 😉

  9. I would say – you were here for just 70 hours. It’s even bigger. There is a lot more of incubators like hack.fwd, much bigger, producing tons of startups every month.

    see you @St.Oberholz 🙂

  10. Re: your first two paragraphs misjudging Berlin, you failed to mention many other factors that clearly put your judgment in doubt.

    1) the architecture in Berlin is sublime; it’s arguably the most beautiful of any city in the world.
    2) art museums on par with anything outside the Vatican museum.
    3) the attitude of the German public is hyper-modern and can be seen in every facet of the society. Look at the design of mundane, everyday objects. Everything is so carefully considered that I was constantly undergoing jaw-dropping shock-and-awe at the gestalt of it all.
    4) you criticized Berlin’s smallest airport (of three) yet failed to mention — for one example — its central train station, which is better than any I’ve seen in my world travels (I’m not German, btw)

    Anyway, way to judge. I’ve lived in Europe and Asia for years and Berlin is by far the most impressive city I’ve seen.

    1. D.Robbins

      Let’s choose to disagree on the architecture. I am pretty sure we cannot find a common ground here. On the museums, I have nothing to say, but on the airport – well criticism is valid. I didn’t land via the train station, though went there a few times since my motel one was right across from the station and it was the only place open for breakfast on a Sunday. It is impressive but frankly not memorable.

      Anyway thanks for leaving the comment.

  11. Problem with short visits to Germany is that you do not get to see whole picture. I lived and worked there and it is country where you get discriminated for not speaking perfect German and where they will look forward to deporting you as soon as possible. Getting work visas even with employer support is like pulling wisdom teeth and visiting Ausländeramt is torture.

    I can just imagine how it is for non-white ausländer in Germany. You should get some insight into this before declaring any german city a Europes tech hub.

      1. Good point, Dev. The level of monoculturalism in Berlin is certainly higher than the other European cities it wants to compete with, which is a big deal. Yes, there’s a big Turkish-origin population, but in my experience they almost form a shadow city.

        In most legal terms, immigration in Germany is roughly the same as most other European countries — however the smaller language footprint of German and state bureaucracy do make it harder than (say) getting started in London. This stuff is important, although remember that Berlin draws much of its immigrant tech population from the eastern reaches of Europe.

  12. Berlin needs to show that it has staying power — it keeps attracting newer, hungrier folks with start-up dreams. However, in order to keep attracting more dreamers, Berlin needs a big company to rise from the rubble. Berlin needs one such big company to emerge in next few years – one that employs hundreds (if not thousands) of people.

    And in order to do that, the city needs a mature venture capital infrastructure. That robust VC ecosystem has helped startups thrive and eventually grow into larger operations in non-Silicon Valley locations such as Boston and New York. Israel is another example of a country that has a robust VC ecosystem.

    Zalando has over 1000 employees…and Groupon/Citydeal is huge as well and internationally headquartered in Berlin. It strikes me as slightly odd that the biggest VC/incubator Rocket Internet of the Samwer brothers hasn’t been mentioned…

  13. “A city’s importance on a global stage is measured typically by the size and scope of its airport: Shanghai, New York, London, Los Angeles, Frankfurt and Paris are good examples.”
    I am missing San Francisco, or do you wanna say that SF and the Valley are not as important as these cities with their huge airports? Finally Berlin is opening a new airport in 2012 (BBI). This should bring Berlin more on the international destination map ;).
    The secret of Berlin is “speciality” and a flow which is not comparible to any other city.

  14. om, i just want to let you know i moved from new york to berlin after reading this article. i took a job with a startup and moved here on feb 13. it’s been five days and already it is shaping up to be an awesome experience. the rent is still super cheap and you can walk everywhere. thanks for your post.. it gave me the confidence to pack up and leave

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