Leather pants instead of hipster chic: Is Munich the startup capital?

For years, Berlin was considered the start-up capital. But now a new EY study shows that Munich is overtaking the metropolis on the Spree. Most venture capital is flowing into the city on the Isar. Tobias Weidemann explains why this has been foreseeable for a long time, while Andreas Weck says that it takes more than that to be the true start-up capital.

Deep tech is the new thing – And Munich can do it

For many years, Berlin was considered the German startup metropolis and the "place to be" for hipster founders. But insiders know that Munich has long since overtaken the federal capital. There are a number of reasons for this: Although it felt like every second person in Berlin had "their own startup" in the 2010s, but many of them were rather small and not as innovative and technologically disruptive as they appeared. The fact that things are different in Munich is due in no small part to generous location subsidies and research-intensive universities. For example, the Entrepreneur-Schmiede UnternehmerTUM, which is part of the Technical University of Munich, has repeatedly produced successful technology companies ranging from Celonis to Isar Aerospace. Together with smaller initiatives ranging from Werk1 to Media Lab Bayern and Gate Garching, this scene forms an astonishingly good ecosystem in the individual startup environments.

For the second time in a row, the Bavarian capital also attracted the most venture capital, according to EY. And that's not surprising, because deep tech in robotics, AI, space, and data analytics is the new thing. – and the industrial location in the south has mastered it perfectly. This has also led to important tech players opening branches in Munich: Google operates one of its largest development centers outside the US in Munich, Microsoft has traditionally had its German headquarters here, and Apple also announced in 2021 that it would make Munich its European center for chip design – The list could go on and on. Berlin is done!

Tobias Weidemann is an editor and communications consultant for digital topics with a focus on e-commerce and online marketing, as well as new finance and business IT. He lived and worked in Munich for many years and is therefore very familiar with the startup scene there. – even the Munich

The fact that most venture capital is flowing to Munich is good news. This is because many innovative technologies are emerging in Munich that urgently need a lot of money. As the previous speaker so aptly put it: Deep tech is at home in Munich – primarily due to the many high-profile university spin-offs. And yet, I think the idea that Munich is suddenly supposed to be the start-up capital is just a pipe dream in lederhosen. Berlin brings together many ingredients for a highly innovative mix: a creative subculture, proximity to politics, and, of course, a large number of renowned universities. – from the FU to the TU Berlin, from the Humboldt University to the UdK.

Business students, artists, and scientists are finding their niche here – and unlike in Munich, it is still affordable. It is also simply wrong to say that most of the startups founded in Berlin are small and uninnovative. Unicorns, i.e., young companies valued at billions, have ideal conditions in the true startup capital. Fintech companies N26 and Trade Republic, AI startup Parloa, solar startup Enpal –, they all come from Berlin. In fact, have you ever heard of a Berlin startup opening an office in Munich? I haven't. On the other hand, it's considered good form for successful young Munich companies to open one in Berlin. Personio, Helsing, Flix –, you are all very welcome. And the capital and its surrounding area can also do big tech: greetings go out to the Amazon Tower in Friedrichshain and the Tesla factory in Grünheide. Bye for now, Munich!

Andreas Weck is an editor specializing in the digital workplace. He has visited many startup ecosystems for t3n and even lived in San Francisco and Silicon Valley. When the Berlin resident buys a round of drinks at the foosball table, half of the people there work at a startup.

This article first appeared on t3n.de.

(jle)