Business Management

Tech Startups in Berlin, Part 1: The Workforce

I've written about Berlin in the past but that was on the basis of a short visit. I've just spent five weeks there, investigating the city's transformation from grungy reunification icon to increasingly slick technology hub – though it's not quite there yet.

German politicians and pundits see Berlin as the logical home for any Brexit-displaced tech companies considering leaving the UK. For that to happen the city needs infrastructure, funding and the right people in charge, which I'll come to in a future article.

But, at least until the machines take over, what tech start-ups really need are people. Ideally those people will be well educated, talented and motivated. And it helps if they are young because, not to put too fine a point on it, young people will accept lower wages than older, more experienced workers. How does Berlin fare in this respect?

Even in the two years since I was last here, things have changed. Berlin's population is growing and that's not solely due to Germany taking in over 1.2 million refugees. The city has built on its international appeal as one of the coolest, most diverse cities in Europe. Its inhabitants are young (the majority are under 35), well-educated and qualified, and of many different nationalities. Whenever these people meet, the social language is usually English, though German is still required in many workplaces.


City sights

I spent the first two weeks in Berlin living in Charlottenburg-Wilmersdorf, which is an affluent, family-oriented region of West Berlin. The rest of the time I spent in Pankow, where the East's academics and intelligentsia aspired to live during the years before the Berlin Wall fell. The two areas are as different as, say, Kensington and Streatham in London, though each has its own appeal.

Other parts of the city, such as Friedrichshain-Kreuzberg and Prenzlaur Berg, have become more trendy, somewhat hipster-ish. The bars, cafés and restaurants in these areas are full of young, keen, international people and many of them work in the city's tech industry. Throw a currywurst here and you couldn't fail to hit a coder, analyst, dev, sysadmin or strategist. Just be sure to say "Entschuldigung" (sorry) afterwards, though some of the locals rarely do (Berliners are infamous for their bluntness). Pankow and Wedding are the next regions slated for tech gentrification, which is just as controversial here as it is elsewhere in the world.

I previously quoted the city's mayor describing the city as “poor but sexy”. The sexy part is still true, but although there is poverty here – it's rare to complete a U-bahn or S-bahn train journey without being asked for money – and increasing protests against inequality and symbols of luxury and wealth, there are growing riches too. Much of those were achieved by tech startup businesses. Jens, a German state legal accountant, told me he's met several Berliners who have retired by the age of 35:

“I've just sold my second startup,’ they tell me, so that's them done,” he says.

Even so, Berlin is still cheap compared to the rest of Germany and much of the rest of Europe. That, coupled with its perceived ‘coolness’, makes it appealing for the young people who in turn provide relatively cheap labour for IT firms.

There’s certainly no shortage of startups here. Some groups for startups have more than 8,000 members. Many of those will be fantasists, of course, but plenty are genuine.


An international crowd

In addition to countless Germans, some local and some who moved from other parts of Germany, I spoke to numerous internationals working in the IT industry. At one event I had conversations with an American IT management consultant, a Russian Java programmer for a cloud-based bank, a Belgian OpenStack developer, an Australian theoretical mathematician working on WiFi propagation algorithms, an Australian killer robot engineer (actually she just said 'robots' but I'm reading between the lines), and a French social media consultant for tech companies. All were young, all agreed that Berlin is a great place to live and work.

One reason for that sentiment is that it's relatively easy to advance your IT career here, since there’s a seller’s market for tech skills. “I left my last job on Friday because there was too much legacy code and I wasn’t learning anything new,” said a German AWS specialist. “I start my new job on Monday. It was easy [to make the switch].” Not everyone agrees with this view, but the majority of people I spoke to thought it was the case for their particular skill-set.

Complaints are hard to find, other than the usual long-hours gripes that, while valid, are true in any city where young, keen IT workers are employed.

The only other issue that cropped up repeatedly is bicycle theft, which is as endemic here as it is in Amsterdam. “You try to do the right thing,” said a woman I spoke to at one meetup. “But after your brand-new bike has been stolen three times, you just go to the place by the bridge where they’ll sell you a replacement for 40 Euros. You know you’re buying stolen goods, but what else can you do?”


Read the second part of our close-up look at Berlin: Tech startups in Berlin, Part 2: The infrastructure


« FutureFest: Fertility as a 3D infographic, 'death yurts' & Pokémon Go meets theatre


The real meaning of… Ransomware »
Alex Cruickshank

Alex Cruickshank has been writing about technology and business since 1994. He has lived in various far-flung places around the world and is now based in Berlin.  

  • Mail


Do you think your smartphone is making you a workaholic?