The Rapid Growth of Germany's Startup Scene

When thinking about Germany and its work culture the first thing that comes to mind is probably efficiency, structure, teamwork, formality and punctuality. And while it might be a correct depiction, there is a new wave of thinking taking the country by storm.

This does not mean that it's less efficient, but rather a different cultural understanding of the work environment. The startup culture in Germany has been growing at such a pace that it is changing the entire working structure of the country–especially in its capital.

But why is Germany growing so much in this area of innovation?

One of the biggest reasons is policy. Just as we explained in our previous article about Switzerland’s Innovation Model, German government is making a conscious effort to fund startup growth and development.

During lockdown, the German government introduced a €2 billion state aid package to keep struggling startups afloat.

It also provided a 100% guarantee for all loans up to $540,000 for small businesses with fewer than 50 employees, and $868,000 for larger ones.

According to PitchBook, a startup is founded every 20 minutes in Berlin. In fact, startups are the fastest-growing job-creating sector in Berlin, employing over 78,000 people. Around 19,000 (32%) of these roles were created in the last two years alone.

Other countries have digital hubs in their capital usually. For example, the Netherlands and Amsterdam, or UK and London.

But Germany is comprised of multiple digital tech hubs. We can all agree that Berlin is the biggest. But there is a clear difference from other countries.

The way in which Germany has organized its digital hubs allows them to have a specific focus for each city. For example, Hamburg is oriented toward Logistics technology. Meanwhile, Stuttgart is oriented toward future industry tech.

There is a generation of young workers that is gravitating towards the startup environment. Looking for a healthy work-life balance has become one of the most important determining factors in choosing where to work.

Many well-established companies are struggling to find top talent. Not only do young workers desire a challenging and fast learning environment, but they're also looking to avoid issues such as burnout and depression that might arise in some work structures.

The challenge is in combining a hard-working, fast pace atmosphere with a sense of cultural belonging and support among employees.

There is a large disconnect between the way in which traditional companies and modern companies function, with more and more people heading to the latter.

But, with the startup economy booming in Germany, there is a necessity for local talent to fill the roles.

In fact, an estimated extra 700,000 tech specialists will be needed in Germany by 2030. Also by this time, the country is expected to have a skills shortage of at least three million workers.

Talents across Europe will have the opportunity to relocate to Germany and develop their careers in innovative companies.

While Berlin is leading the industry when it comes to startups, Germany has numerous tech hubs in cities including Düsseldorf, Hamburg, Cologne, and Stuttgart.

All of these cities are looking for top talents to be a part of their booming tech scene.

Numerous companies are also struggling to find talents that fit what they are looking for.

Did you know that TieTalent just opened its offices in Germany in order to solve this problem? We've made it our goal to connect the right talents across Germany with the right companies!

At TieTalent, we have chosen Stuttgart for our office HQ in Germany. Why you might ask?

Within the last couple of years, Stuttgart has been focused a lot on creating a structure that nurtures the startup scene. With institutions like CODE_n SPACES, Startup Campus Stuttgart, or Startup Stuttgart, entrepreneurs are being supported in a creative and innovative space.

Stuttgart is also known as an industrial city with leading corporations such as Daimler, Robert Bosch, Porsche, and Festo. But Stuttgart isn't limited to the automotive sector.

Companies in various industries can be found in and around Stuttgart. This environment is key for developing the best relationships with employers to boost a startup culture. This is an important fact, especially for B2B startups, since more than half of all startups in Stuttgart only have B2B customers.

Stuttgart is an excellent center for Research & Development in Europe. Every day, companies invest around €13 million in R&D in the region. This is more than anywhere else in Germany. With this in mind, Stuttgart might eventually become the number one tech hub in the country in the future.

Innovation and the startup mindset is conquering Germany. With this change comes a new way of looking at how people work and what they value at their job.

At TieTalent we will strive to connect the right talents with the right companies. Our job is to help people develop their careers, and empower companies to grow with the best team possible!