Goodbye London, hello Berlin
More than 10 weeks have gone by since Brexit vote, and it’s still not clear what the consequences will be for Europe and for the country itself. However, it’s clear to everyone that there’s one city in the start-up scene that is going to benefit from Britain’s exit; we are talking about Berlin! Thus, according to the International Business Times, “more than 100 companies” have already contacted the Berlin Economy Minister Cornelia Yzer, in order to discuss a relocation. However, Berlin as the hotspot for founders and the start-up scene hasn’t been hip since just yesterday and conversely, the positive effects for the city should not be dismissed either.
Significant cash flow in the start-up scene
Although the level of investments in the Berlin start-ups amounted to only 520 million Euro in the first six months and was therefore overtaken by London, Stockholm and Paris, the experts from Ernst & Young appraise German entrepreneurs to be as attractive to the investors as never before. Especially the 60 % rise in financial rounds to now 249, highlights a new mark, according to “StartupBarometers”. The money lenders have invested considerably in the Fintech sector, with 80 million in the past year. In order not to miss the boat as far as the technology of tomorrow is concerned, big players such as Deutsche Bank also count on investments in their own “innovation labs” and thus conjure the innovation power in the liaison with start-ups in Berlin.
Politics is a driving force of growth
In politics, there is also increasing recognition of the far-reaching significance of the start-up scene and is strongly promoted. So the year 2015 saw around 75 million Euro flowing into the ICT, media and cultural industries. In order to provide young founders with capital faster, Berlin wants to increase the pressure on the German Government in the next few days and also improve the general conditions. More attractiveness for the investors should be achieved here, primarily by increasing law security and tax reliefs.
Start-ups – tomorrow’s job engine
But it’s not only fresh capital that puts the city in turmoil, the start-up scene is setting things in motion, especially on the employment market. Thus, there are approximately 80,000 people employed in the digital economy. And this figure is on the increase: In the IT-departments, a 30 % growth is predicted in the next 5 years. In addition, the start-ups in Berlin are particularly solid, which is demonstrated by the number of employees, with an average of 25 employees per start-up, this is exceptional when compared nationwide.
Provisions have been made for the replenishment of skilled employees
An important location factor for big and small companies is the exceptional supply of skilled professionals, in particular. And the number of students enrolled in courses in the IT and digital fields, which amount to 18,000 students, ensures tomorrow’s new recruits. Peak value at a national level. Furthermore, international professionals are attracted by the relatively high, but comparatively cheap, costs of living. Not least, it’s the special flair of Berlin that makes this city an exciting centre of attraction. And it’s especially the founders, who are still at square one, that feel attracted to the low costs of living and settle down in the German capital.
After the Brexit is bevor the hype
Besides the factors mentioned, it will become especially exciting when Britain’s exit from the EU is implemented, and the freedom of travel will consequently become history. For those who implicitly require a residency in the EU, Berlin should increase in attractiveness once again. Also, US companies, who until now have used London as their first point of contact to fathom the European market in their native language, could now feel drawn to another city within the European domestic market.
