Startups set sights on Berlin as technology hub

Fri Aug 5, 2011 10:32am EDT
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By Kalina Oroschakoff

BERLIN (Reuters Life!) - Drawn by creative talent and a young, international workforce, entrepreneurs are increasingly choosing Berlin as a launching pad for internet start-ups, companies and industry observers say.

While none of Germany's top 30 companies are based in the city, its low costs and highly qualified labor pool have laid the groundwork for what many hope could develop into Europe's technology hub.

"Berlin is currently the hottest city in the European startup scene," Matthias Schrader, chief executive of SinnerSchrader one of Europe's biggest digital media agencies and chairman of the annual "Next" conference, told Reuters.

"Berlin has the perfect mix of creative potential, technical talent, low living costs and cosmopolitan flair -- a combination that exists nowhere else," he added.

A government report in June showed that Berlin is Germany's top location for innovative start-ups in the information and communication technology (ICT) field, beating the much wealthier cities Munich, Stuttgart and Hamburg.

One such company, Soundcloud, an online music sharing platform with millions of users including musicians Bjork, Foo Fighters and 50 Cent -- was founded by two Swedes drawn to the German capital.

Co-founder Alexander Ljung said the company, which opened in 2007, has seen its user numbers grow to 5 million users, and has no problems attracting qualified staff.

Mike Butcher, editor of trade publication TechCrunch Europe, said this is not surprising as Berlin is affordable and has a multilingual workforce that speaks English -- an extra incentive for investors.   Continued...

<p>The Brandenburg Gate is pictured at Pariser Platz square in Berlin April 5, 2010. REUTERS/Fabrizio Bensch)</p>