I think the biggest challenge in Berlin/Germany is that very little of the capital that has been poured into the startup sector has made it's way back to the the engineers.

Part of this is due to severe restrictions on employee share schemes (changed recently), low employee turnover (3-6 month notice periods), enforceable non-competes, and heavy tax burdens on income. As a result you see a surprisingly low amount of engineer led/founded companies.

Germany has genuinely innovative companies though, but they don't look anything like SV, eg. Trumpf, Zeiss, etc.