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An Earlybird’s-Eye View of Berlin: The good, the ugly and the missing Written by Ciaran O'Leary on 20. January 2012

Rocket launch

Introducing the first of our Expert Opinion pieces. This week, Ciaran O’Leary of Earlybird gives us his take on the Berlin startup scene…

It’s the trajectory, stupid

Berlin has enjoyed an amazing media frenzy, with the leading Berlin-based outlets as well as international press outlets proudly declaring it the next Silicon Valley. Unfortunately, this is rubbish. For starters anyone who has been to both places will be struck by severe climate differences, although if global warming continues we could see the coast line move closer to Berlin and a less-arctic climate allowing for great local wines.
On a second glance one could also notice that the startup ecosystem in the Valley is approximately one gazillion times the size of Berlin’s (note: not scientific, even though I will try to be in future blog posts)– probably pretty much in line with the respective wine industries.
However this is not bad news and largely irrelevant. Most media and bloggers seem to be totally pre-occupied about the current state of the Berlin ecosystem – if it’s better or worse than town X, city L, valley S, etc.

Depending on what you read, Berlin appears to be the best and the worst place in the world to start a company.

Amen (pun intended).
I recently read a blog post that highlighted some differences between another German startup hub and Berlin. One of the key points appeared to be that there was a severe lack of public bins in Berlin and that this was obviously a bad thing. There were some other more valid points I am sure but it did get me thinking not just about where to dispose of my litter in public but also if the whole Berlin debate had gone too far.

Discussions based on the status quo are irrelevant

How quickly is it gaining momentum, is the direction right, the fundament sustainable? What’s missing, what can we do better? Where are we heading?
Rocket launch
Feels like Berlin is like a rocket just launching and in for an amazing ride. Checking up on the right trajectory will be more important than the status quo. Picture: Nicolas Fleury
Our team is moving to Berlin because we certainly are convinced it will be one of the very best places (right up there with the Valley) for entrepreneurs and VCs for many years to come in the future, irrespective of the city’s current status (ok but we do actually love it now already).

The good, the ugly, and the missing

What I would like to do in this column is to uncover some of the ingredients required to make Berlin not only a hot but lasting startup hub – the good, the ugly and the missing – from the view of a VC (hopefully, without stepping on too many toes). A VC control room view of the ecosystem maybe. Some points straight from Captain Obvious I look forward to covering will be:

  1. Is Berlin attracting some of the best entrepreneurs from around the world (vs. ‘only’ from Germany)? Why? Why not? Can Berlin really produce its own Mark Zuckerberg & Co debate?
  2. Are we building disruptive, globally relevant companies – with some exceptions a pre-requisite for outsized exits. What’s really going on behind the copycat debate / image? You know, the whole where are Europe’s google, Facebook and twitters debate…
  3. Is there sufficient capital – at all stages – to fund the ecosystem? How good / smart is that capital really? Sounds like public perception (and perception is reality if you like it or not) is that most Euro VCs and angels (to a far lesser extent) are bordering the line to pure evil. Are they maturing along with the entire ecosystem?
  4. Berlin is cheap but cheap things tend to be bad – so what’s the deal with the wider infrastructure offered to entrepreneurs?
  5. Further points I can’t think of right now

Be prepared for occasional ranting

I’d also like to meander every now and then and go on the occasional rant – mainly with the aim of finding out more about Berlin’s DNA as a great place for entrepreneurs and those backing them. While we should learn as much as we can from the Valley and other more advanced startup hubs, Berlin should not pre-occupy itself about becoming “the next Silicon Valley.” Focusing on “the next Berlin” will be a much more rewarding exercise.
The wines would suck here but the startups will be great.
More soon,
Your Earlybird, Ciarán O’Leary
Image credit: Flickr user jurvetson