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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

#51

Post by stop50 »

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?

If you are self employed and work a prolonged time for an single customer the german irs can rule that you are effectivly an employed person under the guise of self-employment. The company and the person have to pay then a sum of money for different social security insurances.

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

#52

Post by kdbbfjx »

The startup model works where there is capital specifically large upfront capital available.

Large upfront capital automatically means you chase profit or growth.

Just like McDonalds. Which is really what the SV model is if you scrape away all the whizbang tech bullshit.

There is a reason McDonald inspite of "scale" and "low price" cant feed the world.

Because of the cost of opening a new store and initial capital involved. US had that capital available (thanks to dollar hegemony) esp post Ww2. No one else did.

There is no German/Chinese/Indian version of McDonalds.

Why? Because people are used to running sustainable restraunts without high upfront investment cause there was no capital for it.

McDonalds runs profitably and grows usually at the cost of something else (easy to see what those costs are in mature markets where growth has stalled) just like Google provides free shit at cost of all kinds other things.

But watch carefully what happens to these high capital models if they cant produce profits or growth.

Many have been coasting over the last 2 decades and have captured entire market. But that period is over just like the period where the British Empire expands till it cant any further. A high capital process btw cause you have to pay your army upfront to go shoot the native feudal lord and take his shit. Once expansion is over and all the land is captured how long did it take for British East India company to unravel?

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

#53

Post by pbmonster »

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?

Germany has really, really strong employee protection. Hard to fire, mandatory vacation, mandatory pensions, mandatory maternity and paternity leave, ect.

If you run a society like that, you immediately face a problem: people try to get around the employee protection measures by relying on the gig economy, by hiring freelancers or by starting small companies.

So, the German tax agency has the additional authority to crack down on that. If you work freelance or run your own company, you need to always have several customers. If your only customer is a single company, the tax agency argues that you aren't actually a freelancer/small company, you are a de-facto employee of that company, and the two of you are violating several laws and owe back-payment on several employee benefit systems. Also, that's fraud BTW, here's your case number.

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

#54

Post by fnands »

keiferski wrote: post #23
thomassmith65 wrote: post #22

I kept waiting for the post to mention the German company who make Things.app (culturedcode.com). It seems like a good example of the ethos.

Dollar for dollar, Things is probably the single best app I’ve ever used. I can’t recommend it enough.

It's a one time cost and not a subscription service? If so, amazing.

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

#55

Post by jamiedumont »

Propelloni wrote: post #41
FirmwareBurner wrote: post #26

Earlier quoted context omitted.

>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...

And if you can't read German, it's very similar to the IR35 [0] rules that we have here in the UK.

Effectively... "Don't work as a freelancer for a company if they are your only client. That's employment."

[0]: https://www.gov.uk/guidance/understanding-off-payroll-workin...

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

#56

Post by nwellnhof »

The mythical German "Mittelstand" again. This word is absolutely meaningless. It has been used to describe small businesses, but also companies like Robert Bosch GmbH which has 400,000 employees. "Mittelstand" is nothing but a vague idea Germans cling to, so they feel special.

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

#57

Post by InsideOutSanta »

blackeyeblitzar wrote: post #2

I didn’t find this article credible. It is arguing for small and medium businesses instead of startups, and offers steps to see the vision it paints. But startups are where some of the biggest game changing ideas come from. Large enterprises can sometimes do that too. I feel like the mid sized companies are often stagnant. The product areas it suggests for businesses are very hard to survive in. These other lines sor…

"startups are where some of the biggest game changing ideas come from"

I think the original author's point is precisely that it's not necessary to have big, game-changing ideas to have a working, stable economy. It may, in fact, be better to have many small companies doing small, sustainable things, than to have a few startups doing things that have a huge upside if they work out, but also a huge risk of failure.

In Western democracies, small and mid-sized companies usually make up around 99% of companies, and around 70% of jobs, but in software, there's a huge focus on FAANG-type companies and unicorn startups. It might be better for Germany to focus on building a healthy economy of small companies, rather than trying to compete with Silicon Valley.

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

#58

Post by llm_trw »

Techbotch wrote: post #49
llm_trw wrote: post #29

Earlier quoted context omitted.

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 b…

That you (and apparently the German bureaucracy) think people who can start a business and people who can tick administrative boxes are the same type of person explains German economic performance in the last 5 years.

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

#59

Post by keiferski »

fnands wrote: post #54
keiferski wrote: post #23

Earlier quoted context omitted.

Dollar for dollar, Things is probably the single best app I’ve ever used. I can’t recommend it enough.

It's a one time cost and not a subscription service? If so, amazing.

Correct: https://culturedcode.com/things/

Looks like the different apps (desktop, mobile, iPad) have different prices, but all are one-time payments of $10-$50.

I bought it years ago and IIRC it was just $50 for everything then.

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

#60

Post by jansan »

dotdi wrote: post #44
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…

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 peo…

Thank you for giving an insight into the typical German way of thinking by immediately suggesting that the CIO was complaing about not being able to exploit his employees. He was not. I told him that I am running a tiny company and he warned by about the pitfalls of Scheinselbständigkeit.
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