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We don't need startups, we need Digital-Mittelstand

mertbulan.com

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Re: We don't need startups, we need Digital-Mittelstand

#41

Post by Propelloni »

FirmwareBurner wrote: post #26
jansan wrote: post #24

Earlier quoted context omitted.

I realized a few weeks ago how broken IT in Germany is when I talked to a guy who turned out the CIO of a known German retail company. We did not talk about technology, exciting projects, ideas or similar, but about the complexity of the privacy act and "Scheinselbständigkeit" (false self-employment, which is a huge issue for start-ups and self-employed people in Germany). Out brains are so busy thinking about stuff…

>Scheinselbständigkeit" (false self-employment, which is a huge issue for start-ups and self-employed people in Germany) Can you provide more details about this? How is this a problem and why does it affect startups?

No the OP, but Scheinselbstständigkeit is one of the scarecrows of freelancers and their clients in Germany. It is actually not very difficult, but in certain cases it is very limiting. If you can read German, here is a handy reference sheet, which is distributed by virtually all tax advisors [1].

[1] https://www.sup-kanzlei.de/fileadmin/user_upload/Scheinselbs...

Re: We don't need startups, we need Digital-Mittelstand

#42

Post by alkonaut »

fire_lake wrote: post #4

How can they compete with well capitalized start ups?

Most businesses aren't going to be well-capitalized startups. Because that kind of capital usually goes to businesses that can scale very quickly and to a large size.

But say I have an idea for a business, where the total number of customers worldwide is 100. The max number of employees ever sustainable by this business is, say, 50. But to reach that would take 20 or 30 years of organic growth , maybe a bit less with huge investment. It's what most businesses look like. It's not going to attract a ton of startup money. But it's also not going to be out-competed by a startup.

Re: We don't need startups, we need Digital-Mittelstand

#43

Post by jansan »

FirmwareBurner wrote: post #26
jansan wrote: post #24

Earlier quoted context omitted.

I realized a few weeks ago how broken IT in Germany is when I talked to a guy who turned out the CIO of a known German retail company. We did not talk about technology, exciting projects, ideas or similar, but about the complexity of the privacy act and "Scheinselbständigkeit" (false self-employment, which is a huge issue for start-ups and self-employed people in Germany). Out brains are so busy thinking about stuff…

>Scheinselbständigkeit" (false self-employment, which is a huge issue for start-ups and self-employed people in Germany) Can you provide more details about this? How is this a problem and why does it affect startups?

Well, if you employ self-employed people in your company and after a while you or they get audited and it turns out that you are their only customer, the will be classified as employees of your company. As a result you may have to pay social insurance, pension fees, etc. for the all time they have been working for you, which can be a hefty sum and may break your neck as a small company. Oh another problem that I had not mentioned is that it's extremely difficult to fire people once you have reached a certain size (I think 10 employees or something).

One of the most important rules in Germany for startups: Employ as few people as possible. And I am not joking.

Re: We don't need startups, we need Digital-Mittelstand

#44

Post by dotdi »

jansan wrote: post #24
randomNumber7 wrote: post #8

This is absolute nonsense. Using buzzwords can not replace reasoning. There are structural problems why germany failed to build a digital economy.

I realized a few weeks ago how broken IT in Germany is when I talked to a guy who turned out the CIO of a known German retail company. We did not talk about technology, exciting projects, ideas or similar, but about the complexity of the privacy act and "Scheinselbständigkeit" (false self-employment, which is a huge issue for start-ups and self-employed people in Germany). Out brains are so busy thinking about stuff…

I think you got this wrong. Laws against Scheinselbständigkeit are protecting individuals from being exploited, and it's one of the things that characterizes the EU.

Don't forget that outside of Europe, most big economies were built on the ongoing exploitation of the working class. I am not saying this didn't happen in Europe, but at least there are efforts to curb this.

So a CIO complaining that he can't exploit people for cheap labour is not an argument for broken IT laws. It's an argument for seeing that it works as intended.

Re: We don't need startups, we need Digital-Mittelstand

#47

Post by nicbou »

FirmwareBurner wrote: post #26
jansan wrote: post #24

Earlier quoted context omitted.

I realized a few weeks ago how broken IT in Germany is when I talked to a guy who turned out the CIO of a known German retail company. We did not talk about technology, exciting projects, ideas or similar, but about the complexity of the privacy act and "Scheinselbständigkeit" (false self-employment, which is a huge issue for start-ups and self-employed people in Germany). Out brains are so busy thinking about stuff…

>Scheinselbständigkeit" (false self-employment, which is a huge issue for start-ups and self-employed people in Germany) Can you provide more details about this? How is this a problem and why does it affect startups?

https://redtapetranslation.com/do-i-need-to-be-worried-about...

https://allaboutberlin.com/glossary/Scheinselbstst%C3%A4ndig...

Re: We don't need startups, we need Digital-Mittelstand

#48

Post by jillesvangurp »

fire_lake wrote: post #4

How can they compete with well capitalized start ups?

Startups are like fruit flies. Most startups never get to sustainable revenue. Being well funded just means they burn brightly. You blink and they are gone. The vast majority of startup founders I've talked to over the last 15 years have gone through several startups. Well over 90% of those startups are long gone and forgotten. VC money evaporated. Staff disbanded, acquihired, poached, etc.

Small companies compete by making money. Even a modest amount of money can be sustainable. If you can get to about half a million per year in revenue (enough to employ a few people), a small group of people can get a lot of stuff done. That sounds easy but it's not. The first few hundred thousand revenue are really hard. You are dealing with customers that are demanding results, haggling over pricing, and facing the brutal realities of product market fit all while you are running out of money and time. That's what building a company means. Early success is very fragile.

My pro-tip to startups is to stop calling yourself a startup as soon as you can. Set yourself apart from the wannabes. People will take you more seriously. And the last thing a potential customer wants to hear is that you are this cute startup that is still figuring things out. That just sounds super flaky as a sales pitch. They don't need to invest in you; they need to buy your product and for that they need to believe in your product. And your product had better do it's job or they'll want their money back. If you make money, you should be wary of investors. And if you don't, even more so. There's no such thing as a free lunch.

You're a company that's making money, that has a plan, that knows what they are doing. The sooner you believe that's true, the sooner you'll make your company a success. Most startups have none of those qualities.

Re: We don't need startups, we need Digital-Mittelstand

#49

Post by Techbotch »

llm_trw wrote: post #29
7bit wrote: post #20

Earlier quoted context omitted.

I did, it was super easy.

How long did it take you from start to finish? In Australia, Canada and the US I can open a company in about 30 minutes from picking the name to opening a bank account I can get money into. In Germany the last time I tried it was about 7 weeks.

Well, yes – you can't typically open a business in 30 minutes here but the process is not exactly complex either. If you cant' figure out the administrative part of opening a company, maybe you shouldn't. It also keeps baffling me how that is of any significance. Are people afraid that their "paradigm shifting industry disrupting" idea will lose validity over the the next week? If so, maybe the idea was bollocks to begin with?

Re: We don't need startups, we need Digital-Mittelstand

#50

Post by thomassmith65 »

InDubioProRubio wrote: post #34
thomassmith65 wrote: post #31

Earlier quoted context omitted.

It's a company that seems to care more about craftsmanship than becoming the next big thing.

It might also be a successful recipe- you let a startup become the next big thing, then it ruins it as a mega cooperation- and you just cook up the same thing with paid for quality and slowly hover up there fleeing customers. Slow and steady wins the race?

They're very successful, but, unless they change their ethos, they never will have success on the scale of a tech giant.

They have been Apple-only for 15 years.

If they wanted to rule the world, they would have transitioned Things to the web and to Windows.

To do that, they would have had to hire three times as many people.

It's easy to imagine an alternate timeline in which CulturedCode had spent the past decade 'enshittifying' Things.app to rake in more money.

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