Anyway, there’s lots of funding programs, which on paper is a great offset for the lack of risk and venture spirit. But the programs are all Byzantine in their requirements, long applications, small print in their rules which exclude you etc. For one application of a R/D program for small companies, which is done in a smart acrobat pdf (wow), on the cover page, it asks for the company stamp.
What is a company stamp? I’m not quite sure, it doesn’t seem to be a legally required thing. It’s just a ink stamp with the company name and some basic info, that you can stamp paper documents with to make them appear more official.
So I spent another 25€ to get a company stamp and ink pillow for my startup. Another startup expense, and strangely representative of the entrepreneurial experience in Germany overall.
Not if you're in the German "company stamp business". :)
To put this in perspective: You can also start a company in Germany for 30 Euro and 15 minutes of time.
That's a so called "Kleingewerbe" where you can make up to 22.000 Euro/year turnaround with _much_ easier regulations on pretty much everything.
If you want to test something or have some side hustle going on, that's the way to go.
Don't be scared by all the reports like the above.
Why would you go through the (reduced) hassle to start a business on the conditions of making less than minimum wage?
That seems backwards to me, compared to other EU member states. This "German way" seems more like it's more discouraging to start a small business, rather than encouraging it, and more convincing to just stay employed instead rather than bothering to start a small business.
It matches my perception that people in Berlin will come together to start some brick and mortar business without big growth potential and call it a "startup". Yes they did "start up" a company, but if you choose the English rather than German word that people associate with silicon-valley style tech startup to describe your venture, I think you should have a business model that aims for growth, not just a be a collection of young people to start a company. I guess it shows that in risk-averse Germany, traditionally young people become employed rather than start their own companies. So even if it's not a startup in the VC sense, the young entrepreneurs still call it that because it is risky and modern from their point of view.
So called "Mittelstand" is what the German economy is build on. These are stable companies, often lead by families in the nth generation, concentrating on making good products. Most of these companies are the result of somebody (or some friends) being good at something, starting in his shed and scaling that operation up over time.
Aiming for that unicorn/public funding/VC money is just plain stupid. At least it's rich people money that's usually getting burned there.
You’re using the wrong tense here. Germany used to be a bit more innovative, the „Mittelstand“ is a leftover of that.
Innovation and impact require risk.
...on inherited wealth from WW2 salve labor and war profiteering[1].
When you outgrow the 22k though (that limit is called "Kleingewerbe"), you'll have to do advance VAT returns and stuff like that. That's what I meant with much easier regulations when you start/stay small.
Don't get me started on making certain legal statements in a kind of commerce registry. It almost feels royal with handwritten stuff and a person helpfully dictating the correct legal incantation that properly changes the social capital. At least the workers were indeed helpful.
To top it off we got Portuguese legalese letters from the tax authority that were unreadable to the founders. They were so convoluted, we thought we owed something but in fact we were being asked to withhold payment to another company which owed tax money. It was so convoluted I asked a lawyer.
Regarding applying for money. We did apply for money and got granted but the money turned out to exclude wages or the founders so we rushed to have profitability otherwise we could just not support ourselves. We still did money but it was a miserable life and we earned far better being employed. This is the same in Poland, with some fellow aeronautics colleagues. That is the "VC" system in Europe. No trust, no understanding: everything stays the same except for the ones who know the system.
A fellow startup-er made a demo to a bigger company proving the concept, the bigger company took the demo, and showed to another bigger company because the money they could ask for would be bigger. Of course the bigger partner had no experience and the project came up empty.
Lastly, I tried to do business as a consultant to Portugal, while being a resident in Poland. Due to me being a citizen I needed to pay VAT even though I would not need to because I am not a tax resident there and would be double taxed. I canceled the contract as again I earn more employed and cannot be bothered.
Finally, as it is not only a problem of VC, me and my business partner were engineers and we definitely were out of depth on running a company to the full potential. Looking back I would have liked to have paid for a professional manager that would understand doing business better.