Berlin: World Tech Capital and How it’s Performing?
Berlin is the capital city of Germany and one of the 16 states. Berlin is a world tech capital as well, ranking as one of the top 10 startup destinations in Europe. The German government has invested heavily in Berlin to make it a powerhouse for economy and innovation, with more than 1,000 startups operating. It’s also become an international hub for fashion, creativity, and art with many tourists visiting annually to experience its rich culture.
This article will look at how Berlin has evolved and propelled itself to become a world tech capital that is booming economically.
Berlin– A World Tech Hub
Although Berlin’s startup scene is smaller compared to other European countries, Berlin continues to be one of the top cities for startups. The reason behind that is its friendly ecosystem accompanied by government support, tax reliefs, and subsidies. Berlin is ranked 3rd in Europe with one of the largest startup ecosystems after London and Paris.
Given its rich history, people view it as an incubator for startups trying to make a change in the world. Most startups in Berlin today focus on artificial intelligence (AI), B2C, and B2B.
The Berlin startup ecosystem is unique as it offers an exciting combination of established players with creative talent and fresh perspectives from tech newcomers.
Due to the pooling of knowledge and experience between startups, people in neighboring offices can easily interact even when not working on the same project. Berlin’s startup scene also hosts many conferences to promote harmony and communication between the companies.
Berlin – An Ideal Location
Berlin’s geographical location has made it an ideal spot for startup companies due to its closeness to capital cities, low costs of living, and vibrant history. It also allows companies from Silicon Valley to partner up with local startups to enter the European market. This is especially true for artificial intelligence startups in Silicon Valley who can easily sell their products and services to people in Germany, Italy, France, The Netherlands, etc.
One of the biggest problems with startups today is competitors who copy your innovative ideas or replicate your product. Companies in Berlin have a unique advantage: they can easily move into a new country once they have established themselves in one.
For example, startups that offer services or products to the German market can easily expand into Germany’s neighboring regions. If companies based in Berlin want to target people in France, Italy, and The Netherlands, they would only need to relocate their business headquarters to any nearby countries.
This is how Berlin startups save money and time.
Berlin- The Financial Capital of Germany
Since the 2008 financial crisis, the German economy has been going through a rough patch. The recent influx of refugees into Germany has further strained its economy by increasing unemployment rates. To solve these problems, the German government increased spending on infrastructure and education to stimulate their economy.
Berlin benefited from this development eventually as people started moving into the city in search of employment opportunities. Many foreign companies like Google set up their headquarters in Berlin due to its financial capital status. Given below is a graph showing how the gross domestic product of Berlin increased during the economic crisis in 2008.
Financial Capability- A Wealth of Experience for Startups
Berlin’s financial status makes it easier for entrepreneurs, especially those who want to set up their own business or startup company. Compared to other European countries like Spain and Italy, new startups in Germany have an advantage because they don’t have to go through many legal hurdles in setting up their business.
Berlin startups also have access to more funding than other European startup hubs like Madrid, Barcelona, and Milan, where bureaucracy makes it harder for investors. However, they can easily approach venture capital firms in Berlin since the city has one of the biggest concentrations of VCs in Europe.
Moreover, most of these venture capital firms are familiar with local markets and have a lot of experience dealing with startups. This has increased the chances of Berlin startups getting funded by such investors.
In 2021, the European Union is planning on establishing a single market for the entire EU. Technically, once this happens, Berlin startups will be able to reach out to more potential customers within the Eurozone without needing to relocate their business headquarters physically. This stands to offer them a significant benefit in the long run that would further their dominance over the European market.
Berlin – Social and Creative Capital of Europe
One distinctive thing about Berlin startups is that they can easily break through the barriers of social and cultural divisions. Because of Berlin’s history, the city is home to a diverse range of cultures from all over Europe.
This has allowed different kinds of people to thrive as one community without any reservations or worries. As a result, Berliners are more pragmatic compared to their counterparts in other European countries.
This has also allowed Berlin startups to tap into a wider pool of talent compared to other cities. The locals in Berlin are usually more open-minded because they have learned to accept multiculturalism with ease as a result of living in such an environment and culture.
Berlin is also a creative hub since it attracts many artists, musicians, and performers from all over the world. This has made Berlin a center of innovative art, music, film, graphic design, fashion, and publishing because of its diversity and vibrant history.
Berlin’s startup ecosystem is growing dynamically, with an increasing number of entrepreneurs building new startups. The city is enveloped by startups ranging from those oriented towards Germany’s international markets to innovative companies like Uber and Airbnb.
Ranging from technology to finance and social enterprises, Berlin has a lot to offer for any startup entrepreneur who plans on setting up their own business or venture. In addition, the city’s cheap labor and prime location in the heart of Europe also make it an ideal choice for entrepreneurs.
Berlin is expected to become a larger startup hub within the European Union as its financial capital status improves. Like any other city, Berlin has its own pros and cons. However, given its predicted growth, Berlin can be a great place for startup companies to be based.