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Germans don’t do tech startups – more access to capital might change that

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Re: Germans don’t do tech startups – more access to capital might change that

#151

Post by tormeh »

Gravityloss wrote: post #72
olavgg wrote: post #32

Earlier quoted context omitted.

I am working for startup in Norway that has seen extreme growth in just 2 years. We are in the chatbot/virtual assistance space and our biggest competitors are big multi-billions US companies. When it comes to european languages, we are at least an order of magnitude better in understanding natural language and delivery speed(from start to production) than these big companies. But oh boy how many times EU companies p…

I wonder if the competition in EU is hard enough, if companies always choose the "safe" or "good enough" solution?

Me too. I've heard an observation from a Belgian customer: Once a Belgian customer has signed a contract with a supplier, they're married, and will put up with all kinds of shitty product. Presumably, I speculate, because cancelling the contract is seen as an admission of failure for the buyer. Completely crazy. Entire countries never cancelling no matter how shitty the product turns out to be.

Re: Germans don’t do tech startups – more access to capital might change that

#152

Post by snovv_crash »

sgift wrote: post #123
mk89 wrote: post #112

Earlier quoted context omitted.

Workers know what they are getting into. Customers know what they are buying. It's an ecosystem that lives on its own. Could you think of Google made in Europe? In Germany, in France, or in Italy? It's no wonder that many Europeans tend to go and live in the USA for that reason.

> Could you think of Google made in Europe? In Germany, in France, or in Italy? Some of the biggest companies in the world are from Europe. All of them started as small companies. So, yeah, Google made in Europe is possible. Tech is not a special snowflake industry with other rules than everyone else.

Yes, but they aren't as young as Google. They were probably started 100+ years ago, when Europe was still hungry.

Re: Germans don’t do tech startups – more access to capital might change that

#153

Post by beberlei »

dschuetz wrote: post #43

In Germany most start-ups are self-funded with maximum personal risk. That means that you only fail once, after that you'll never be able to recover from bankruptcy only to do your next thing. As Germans are not known to be risk taking folks it's understandable why there are slim chances for the next Silicon Valley in Germany. It's all about risk and risk taking . Tweak those parameters economy-wise, then we talk abo…

I doubt that is true, do you have numbers for this claim? I see many companies founding limited structures (UG or GmbH) to have avoid maximum personal risk. It can be done with just 1€ of capital.

Re: Germans don’t do tech startups – more access to capital might change that

#154

Post by tormeh »

expertentipp wrote: post #84
merb wrote: post #64

Earlier quoted context omitted.

you never heard of zalando?!

The shipment and courier services are not that reliable in many places, many Europeans still buy clothes on Chinese/Vietnamese/local markets. There are really few people who buy branded clothes > 100 EUR per item while most retailers aim almost exclusively at them. Weird strategy of reaching to or convincing clients from other EU countries just by hiring some teenage anorectic tattooed models and influencers. Yeah, I…

Dunno, in Norway it seems a third of all packages in my previous local post office was Zalando packages. It is HUGE there.

Re: Germans don’t do tech startups – more access to capital might change that

#155

Post by tormeh »

southerndrift wrote: post #150
rad_gruchalski wrote: post #141

Earlier quoted context omitted.

Few comments on this, I live and work in Germany as Freiberufler for last couple of years or so. > * the most difficult tax system in the world. even freelancers have to use accountant services, because most people will not be able to pay taxes properly without it. Nothing strange about it. When I was self-emoloyed in the UK, I also had to use services of an accountant. > * high taxes - 42% income tax + Solidaritätsz…

Cringe more: https://www.heise.de/newsticker/meldung/Missing-Link-Der-Kam... During the late 80ies, Germany was on track to have 1G fibre connections everywhere by the end of the century.

Do you know why it's just not a priority? It's in the current coalition's agreement, but they just don't seem to get around to working on it, for example.

Re: Germans don’t do tech startups – more access to capital might change that

#156

Post by southerndrift »

tormeh wrote: post #155
southerndrift wrote: post #150

Earlier quoted context omitted.

Cringe more: https://www.heise.de/newsticker/meldung/Missing-Link-Der-Kam... During the late 80ies, Germany was on track to have 1G fibre connections everywhere by the end of the century.

Do you know why it's just not a priority? It's in the current coalition's agreement, but they just don't seem to get around to working on it, for example.

No, I have no idea. It's especially ridiculous since every unemployed person could be offered a job since digging trenches is something that everybody can do. It's a perfect economic stimulus for any country.

Re: Germans don’t do tech startups – more access to capital might change that

#157

Post by wsc981 »

s3nnyy wrote: post #115
jashmatthews wrote: post #101

Earlier quoted context omitted.

> Where do you want to work in Germany? Which tech company provides the opportunity to earn a lot of money while working on really interesting topics at a large scale? Global companies have massively increased their presence here. Google has a huge presence in Munich, notably including a chunk of the V8 developers. Apple has a large hardware team in Munich. Amazon Berlin is aggressively hiring for developers to work…

I still don't get why Germany is underpaying engineers. After taxes, a cleaning lady in Switzerland can earn more than an engineer in Germany. Net salaries in Zürich are the only ones in Europe that match Bay Area level. (Living costs are lower than you think, see my blogpost titled "Nine reasons why I moved to Switzerland to work in tech", which I wrote after I emigrated from Germany: https://bit.ly/2GNlJcA ) So why…

   ... So why should top notch talent move to Germany, if they can 
   move to Norway, the Netherlands or Switzerland where they earn 
   double or triple? ...
Salaries for software devs in The Netherlands aren't really great. Probably worse or the same level as (most of) Germany. Taxes are a huge burden, though expats get a 30% tax exempt ruling [0] for a couple of years.

I wouldn't recommend moving to The Netherlands for the salaries. But there might be other reasons to move there.

I just left The Netherlands, working from Thailand now and while I earn about half of what I earned in The Netherlands as a freelance dev, I probably save more money in the long run due to lower (practically non-existant) taxation [1] and just a general lower cost of living (especially on the Thai countryside, where I live with my GF and daughter).

Oh, I also only work 4 days a week now instead of 5, so better quality of living.

I estimate that in The Netherlands my basic cost of living was probably around 2500 EUR a month (mortgage, food, insurance, commuting), but in Thailand for the 3 of us it's around 1000 EUR or so (we built a house here, so no housing costs).

P.S.: I don't work for a Thai company, I work remotely (currently for a US client) through my Seychelles offshore company [2].

---

[0]: https://www.expatica.com/nl/finance/Tax-exemption-Dutch-30-p...

[1]: https://www.aesinternational.com/education-centre/taxes-for-...

[2]: https://www.sfm-offshore.com/seychellesoffshorecompany.html

Re: Germans don’t do tech startups – more access to capital might change that

#158

Post by solveit »

earthnail wrote: post #116
Jdam wrote: post #19

Earlier quoted context omitted.

I’ve lived in Berlin for some years. What I‘ve seen from most of the startup scene there was that people are more collecting memories than building businesses. The predominant mindset was like „we don’t want to take over the world and we will most likely fail anyway“. The successful ones, like Dubsmash, leave for the US after a while. If I, as a German, was to create a startup in Europe today, I’d do so in London.

I am German and co-founded a start-up in berlin. After it failed, one of my co-founders and me tried again - this time in London. Boy, what a difference. Seed funding, tech talent, tax situation, and lawyers to help you start your company - all on a better level. Yes, living was more expensive, but we actually enjoyed that - it put pressure on us and everyone working with us. We had a highly successful exit in less t…

What did you do that you could exit in less than a year?

Re: Germans don’t do tech startups – more access to capital might change that

#159

Post by sarabande »

destartupop wrote: post #2

I've been trying to build deep tech startups in Germany for 6 years. I managed to sell the first one I built to a US company (for a very small amount of money) and started afresh after taking a break as an employee. Right now I'm at the point of giving up again because it's so damn hard to find customers here. In my opinion, for deep tech startups the problem is not primarily access to capital but access to customers…

Can you share which deep tech startup companies you find successful in Germany?

Re: Germans don’t do tech startups – more access to capital might change that

#160

Post by dschuetz »

beberlei wrote: post #153
dschuetz wrote: post #43

In Germany most start-ups are self-funded with maximum personal risk. That means that you only fail once, after that you'll never be able to recover from bankruptcy only to do your next thing. As Germans are not known to be risk taking folks it's understandable why there are slim chances for the next Silicon Valley in Germany. It's all about risk and risk taking . Tweak those parameters economy-wise, then we talk abo…

I doubt that is true, do you have numbers for this claim? I see many companies founding limited structures (UG or GmbH) to have avoid maximum personal risk. It can be done with just 1€ of capital.

You still need liability capital for a GmbH (e.g. LLC) which most start-ups just don't have. They start off single or as a GbR with a second or more partners, and then eventually change the company liability type to GmbH, when they generated the capital needed. A real start-up doesn't have to be a GmbH at all. In fact about 2/3 are single start-ups in Germany with maximum personal risk, not even GbR which is only 8%. The rest are GmbH with 30% which also counts start-ups with a bigger company as backer.

That paper is a bit dated, and in German, but still the general assumption that most start-ups are poor remains true for Europe, not only Germany. https://www.destatis.de/DE/Publikationen/WirtschaftStatistik...

What is true though, a UG (e.g. Ltd), is an alternative to GmbH in terms of liability and capital. The 1 euro capital is a joke, imho. Because no sane credit institute would lend you money when they see your tiny liability investment. However, it is possible to make your business legal and profitable, and then borrow some money. But, honestly, starting with literally nothing is like starting a new game at maximum difficulty and perma-death, and who does that in RL?

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