The Best Place in Europe to Found a Startup
Turning your brainchild into a business – facts to help you find the right location for your company.
Let’s say you’re an entrepreneur, or you have an SME. You’ve got this idea for a new business model, supported by a smart product that just needs to be developed. This product has, you are sure, the potential to be great – it’s new in your sector and has the innovative capacity to disrupt it. Let’s call it the Panversa, because it is so versatile and can be used for almost everything.
So, you want to turn your brainchild into a business. The problem is, the conditions are not so good where you are. Not enough skilled talent around, no suitable premises, little investment capacity, no ready market or potential partners, no network, no infrastructure.
What to do? Where to go?
The solution is clear. You have to relocate. You start looking around for markets and metropoles.
Being the reasonable and rational sort of person you are, you make a shortlist of places that could nurture your venture. Where’s the best place in Europe to start a startup?
To make your decision, you need to gather some relevant knowledge. Which facts indicate that a location provides the suitable environment to grow a business?
Well, you figure you need to know the following to be able to make an informed and wise decision:
- Lots of startups in one place indicates a suitable breeding ground. How many startups are there?
- How easy is it to get financing there?
- How good is the startup infrastructure?
- How easy is it to find talent there?
The Facts About Business in Berlin
To make the decision easier for you, we’ve gathered together all the facts you need to make your choice Berlin.
Startups in Berlin
- Every year, more than 500 startups are founded in Berlin.
- The startups are bigger in Berlin too – on average, Berlin startups employ 44 people, while the national average is 20 employees (German Startup Monitor 2022).
- According to startup-map.berlin, there are 25 Unicorns in Berlin, including N26, Trade Republic, Gorillas, wefox, Contentful, Flink, TIER, Solarisbank, GetYourGuide, Sennder, Forto, and smava. For more on the unicorns, see Success attracts Success.
- Green startups account for 26% of all startups in Berlin (Green Startup Monitor 2022).
- In Berlin, more and more women are founders (21% according to the startup-map).
So whether Panversa is a SaaS or online platform, an industrial or financial product, whether it’s green, social, B2B or B2C – if so many visions have been fulfilled in Berlin, so can yours be.
Financing in Berlin
- Investitionsbank Berlin’s range of programs covers the founding and growth phases of startups with grants, loans and equity investments.
- In 2022 Berlin had a financing volume of $5.4 billion, according to dealroom.co, putting the city among the top 10 worldwide.
- According to startup-map.berlin, about one third of Berlin’s startups are financed by venture capital.
- Almost half the VC money going to startups in Germany goes to ones based in Berlin (EY Startup Barometer Deutschland, January 2023)
- The lion’s share of VC financing rounds (39% of rounds in Germany) takes place in Berlin too (390 in 2022, 503 in 2021).
- Six of the ten largest financing rounds in Germany in 2022 went to Berlin startups: wefox, Forto, Trade Republic,Taxfix, Matter Labs, and CoachHub.
- Of the ten largest financing rounds in Europe, three went to Berlin.
With so much money flowing into startups in Berlin, Panversa has great chances of attracting investors’ attention.
You’ll find a comprehensive overview of funding possibilities here: Backing in Berlin.
Startup Infrastructure in Berlin
- The Startup Heatmap Europe 2022 puts Berlin in first place, ahead of London and Barcelona.
- 81% of startups rate the Berlin startup ecosystem as (very) good
- Berlin has more than 150 coworking spaces (SenWEB Projekt Zukunft). See also the definitive list of coworking spaces in Berlin.
- 25% of all existing offerings in Germany to support startups – such as incubators, accelerators, technology parks, company builders, coworking spaces, among others – are located in Berlin.
- The city is home to the DigitalHub für FinTech und IoT, which is funded by the German government.
- There’s a closely networked startup community – for instance, the Startup Association or the local group ‘Startups.Berlin’ of the event portal meetup.com, which lists around 22,000 members.
- There are many world class startup events, such as: TOA Berlin, re:publica, hub.berlin, StartupNight, WeAreDevelopers World Congress, IFA Next Startup Days, AsiaBerlin.
All this fervent startup vibe and buzz – in Berlin you’re sure to find like-minded individuals, sparring partners, cooperation partners, research partners, beta-testers, pilot customers, and generally friendly people interested in what you’re doing with your Panversa.
- Berlin is an international talent pool and one of the most attractive cities for young professionals.
- Employees in Berlin are particularly international – 45.4% of employees have an international background (average 28%) (Startup Monitor 2021).
- Regional politics supports not only founders and SMEs but encourages incoming talent, for instance through projects such as because.berlin.
- Berlin’s focus on diversity and inclusion attracts talent.
- The quality of life for families in Berlin attracts talent.
- Five universities provide the job market with highly qualified graduates.
Berlin is a draw for all sorts of people. The city’s lively atmosphere and high quality of life make it an attractive place. No wonder skilled people gather in Berlin. It will be easy for you to assemble a great team in Berlin.
Free Help for Burgeoning Businesses
The city provides plenty of places to get free advice and help to found or relocate your business.
- The easiest and best way to check out all the options is to get free advice from the experts at Berlin Partner, Berlin’s business development agency.
- The Chamber of Commerce and Industry of Berlin (CCI Berlin) provides the city's enterprises with a diverse range of products and services.
- The Business Location Center provides services to businesses wanting to settle in Berlin.
- The Business Immigration Service enables the quick and uncomplicated issuing of residence permits for entrepreneurs and qualified specialists.
The Number One Choice for Developing Your Business
All the above facts provide clear indication that Berlin is a good place to develop your vision and your company.
There’s one more important point to consider:
The political will is there in Berlin to support your promising business model and innovative idea. The Senate Department for Economy, Energy and Public Enterprises connects relevant stakeholders for the further development of the Berlin Startup Agenda. "Berlin is developing into one of the most important business and technology locations in Europe and aims to become a role model for sustainable business.” This aim is anchored in the city’s program Startup Agenda. The political will is there to “create the conditions for the sustainable further development of the ecosystem."
So what are you waiting for? Come to Berlin and turn YOUR Panversa into a flourishing business!
Text: Olaf Bryan Wielk, ideenmanufaktur
Header image: © istockphoto.com / FilippoBacci