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Founding a company in Germany: €9600, 152 days and I still can't send an invoice

paolino.me

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Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#691

Post by selfmodruntime »

nish1500 wrote: post #319
rob74 wrote: post #165

> Which leaves the only real question. Why 25,000 at all? It is my company and my risk. If I want to start with nothing, that is my call, not a toll the state collects before it will let me try. And the cheap door has a price of its own: to some clients, “UG” reads as “not serious,” and they would rather deal with a GmbH. The structure built to let me in quietly marks me for using it. The 25,000 is there to make sure…

High initial capital requirements have repeatedly proven to be more detrimental than beneficial ( https://mariusring.github.io/web/BacherFagerengRingWold_Sele... ). Germany is an outlier in wanting to keep the barriers high. Running a business in Germany is for a closed inner circle. The apparatus is not meant for broke college students turning their weekend project into a company.

German is an outlier in anything. What the poster has yet to mention is the horrific state of things when actually running a company. Insolvency in Germany is easy to achieve, either from illiquidity or over-indebtedness. All responsibility is on the company's director to oversee possible insolvency tests, of which there are many. If you cannot pay at least 90% of due liabilities within 3 weeks (illiquidity), you're expected to run out of cash within the forecast horizon(imminent illiquidity), or have liabilities exceeding assets unless a 12-month going-concern forecast is positive (over-indebtedness), you will need to declare insolvency.

Filing insolvency must be done without undue delay (a special legal term) and no longer than 3 weeks after you have realized that you might be in insolvency. If you fail, you will be personally liable in full (though there is a honor codex amongst insolvency lawyers to not go after the family home) and you might face jail time. These rules and personal liability have actually been made much stricter in recent years as well.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#692

Post by selfmodruntime »

WarmWash wrote: post #224
Lariscus wrote: post #194

Earlier quoted context omitted.

The authors inability to understand this really makes wonder how much of the rest of their story is essentially self-inflicted.

They are jealous of the US system where you can create an LLC in one hour for $200, and by the next day be doing business with all your personal assets isolated.

It's easier in any EU country. Not in Germany though. The EU is coming up with special EU LLCs thankfully.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#693

Post by selfmodruntime »

asyx wrote: post #511
ecshafer wrote: post #294

Earlier quoted context omitted.

The author can surely understand it. And this system is what is keeping Germany and many European countries from propelling their economies forward by reducing market dynamism. Its not a coincidence that China, US and many other countries, which have more dynamic markets and large GDP growth let you set up a company in a day.

No he doesn't. You can register a Kleingewerbe at the Gewerbeamt online ([1] for NRW) and start right away. You can create an UG (literally supposed to fill the gap between a GmbH and a Kleingewerbe) within 2 weeks depending on the notary. And those 2 weeks come from the fact that the notary has better stuff to do than a UG registration and therefore probably doesn't make time specifically for you. If you want to sta…

I have registered a GBR before and I would not do it again. The risk due to personal liability is too high.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#694

Post by selfmodruntime »

rapatel0 wrote: post #259
Lariscus wrote: post #194

Earlier quoted context omitted.

The authors inability to understand this really makes wonder how much of the rest of their story is essentially self-inflicted.

In america, we have liability insurance. Is this not a thing in germany?

It is, but you won't get it if you're not a GmbH (a limited company). They are more often for company directors to avoid excess personal damage.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#695

Post by selfmodruntime »

glad_duck wrote: post #620
rob74 wrote: post #165

> Which leaves the only real question. Why 25,000 at all? It is my company and my risk. If I want to start with nothing, that is my call, not a toll the state collects before it will let me try. And the cheap door has a price of its own: to some clients, “UG” reads as “not serious,” and they would rather deal with a GmbH. The structure built to let me in quietly marks me for using it. The 25,000 is there to make sure…

It's funny, so it's not even an authorized capital? That one can usually be spent. So these 25K is simply put in the bank as a guarantee? For what exactly? Like if somebody wants go give me a loan they will look at this number and limit a loan to 25K so they are "guaranteed"? It's a great idea, put money in the bank, take 25K loan and ... what would my net assets be? What am I missing?

For debtors during an insolvency.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#696

Post by selfmodruntime »

nish1500 wrote: post #104

I've run a tech business on three continents, and nothing comes close to the Kafkaesque labyrinth of the German world. Everything is unbelievably complicated and over-engineered, and every layer is immune to change. Every rule was rational when it was added, and now everyone has a financial stake in continued complexity. The German notary is the highest-paid notary in the world, and the highest-earning professional i…

German notaries, unlike anywhere in the world, get a percantage of a done deal. That is just insane.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#697

Post by selfmodruntime »

m_fayer wrote: post #671
nish1500 wrote: post #104

I've run a tech business on three continents, and nothing comes close to the Kafkaesque labyrinth of the German world. Everything is unbelievably complicated and over-engineered, and every layer is immune to change. Every rule was rational when it was added, and now everyone has a financial stake in continued complexity. The German notary is the highest-paid notary in the world, and the highest-earning professional i…

Hit the nail on the head. These bureaucratic obstacles are also a manifestation of a culture. A culture that will, in a subconscious and subtle manner, sneer bristle and balk at you, who dared to start a company. What’s wrong with you and who do you think you are, comes the message. Why isn’t what we all do good enough for you, comes the demand.

If in the slim chance of you making it big, the people around you will sneer and balk, calling you a rich tick who should be paying more into a failing system

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#698

Post by selfmodruntime »

ghusto wrote: post #666
nish1500 wrote: post #104

I've run a tech business on three continents, and nothing comes close to the Kafkaesque labyrinth of the German world. Everything is unbelievably complicated and over-engineered, and every layer is immune to change. Every rule was rational when it was added, and now everyone has a financial stake in continued complexity. The German notary is the highest-paid notary in the world, and the highest-earning professional i…

> You were never supposed to incorporate a company. You were supposed to get a job at Volkswagen. This is it. They can't fathom a world in which people do their own thing. What gives me pause for thought though, is the fact that the German economy does comparitively well within the EU.

Germany is generally averse to any kind of social mobility.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#699

Post by selfmodruntime »

artemonster wrote: post #342
nish1500 wrote: post #104

I've run a tech business on three continents, and nothing comes close to the Kafkaesque labyrinth of the German world. Everything is unbelievably complicated and over-engineered, and every layer is immune to change. Every rule was rational when it was added, and now everyone has a financial stake in continued complexity. The German notary is the highest-paid notary in the world, and the highest-earning professional i…

and just read these awful comments defending this nonsense and shifting the blame. so much arrogance its nauseating

There's a German proverb I enjoy. "Am deutschen Wesen soll die Welt genesen", which roughly means "The world shall be healed through the German spirit/nature."

It implies German cultural and/or moral superiority and was used in earnest during the 19th century by nationalists. It's use often has a more ironic character now, but it's proponents are alive and well.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#700

Post by selfmodruntime »

TulliusCicero wrote: post #516
artemonster wrote: post #342

Earlier quoted context omitted.

and just read these awful comments defending this nonsense and shifting the blame. so much arrogance its nauseating

Germans will say they're not very patriotic, but really the way German patriotism manifests is a resistance to outside criticism paired with a stubborn insistence that things ought not change.

More like a stubborn insistence that their way is right and ultimately, the only way.
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