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In 2021, can Berlin or Paris unseat London as the world’s Startup capital?

The European startup scene is thriving. During the Covid-19 pandemic, the creativity and flexibility of entrepreneurs has been vital to finding solutions to societal problems. Many innovations have come to market quickly and will continue to have an impact far beyond the crisis.

In 2021, can Berlin or Paris unseat London as the world's Startup capital?
Photo: Getty Images

So, which cities are helping the stars of the startup world to shine brightest? The Local has partnered with ESCP Business School, which has six campuses across Europe (in London, Paris, Berlin, Madrid, Turin, and Warsaw) and its very own startup incubator, to find out. If you know any would-be entrepreneurs with an international mindset, this guide can help them understand the European startup landscape.

Find out more about ESCP Business School and how it develops the innovators of tomorrow

London: still the leading light

The UK’s capital city remains Europe’s top startup ecosystem, both for the number of startups and the number and size of funding rounds.

London is home to several fintech giants that have shaken up financial services, including Revolut and Wise (the new name for TransferWise).

But it also offers impressive success stories in other areas. Take Karma Kitchen, for instance. It wanted to raise £3 million in funding to open new sites around Europe – and ended up with £252 million.

London is also home to one of the ESCP campuses, where students can study its unique Bachelor in Management (BSc) programme (studying in three countries in three years).

Founded by entrepreneurs in 1819, ESCP has a long history of preparing students for the business world, including the challenges of running your own company.

Will London continue to lead in its post-Brexit future? Nobody can yet be sure. But one thing’s for sure: there’s no shortage of pretenders to the crown.

Photo: Getty Images

Paris: fintech, femmes … c’est fantastique! 

Not everyone associates Paris with startup culture. But if you want to show off your up-to-date business knowledge, you probably should. The French capital has seen impressive growth in funding over recent years.  

Strong government backing has included the introduction of a free, fast-track tech visa to make it easier to bring in foreign talent. Paris’s annual Viva Technology conference has also attracted major speakers such as Facebook founder Mark Zuckerberg. 

The city is especially strong today in fintech. Indeed, a French junior minister described Brexit as “a huge opportunity” for Paris to compete for the title of European fintech capital. 

Tech startups are not blessed with the best reputation for diversity. But Femmes Business Angels in Paris is making a difference, with around 150 women personally investing in and supporting early startups with high potential.

The Blue Factory is a Paris-based startup incubator, launched by a group of ESCP graduates in the early 2000s. It helps students and alumni of the school to develop projects in many fields, including education, employment, food, and fashion. Support programmes cover everything from testing initial ideation to seeding – and then scaling to expand internationally. 

Students on ESCP’s Bachelor in Management (BSc) have the opportunity to gain the kind of skills and experience that are vital in the startup world. For example, they get to work on social impact projects that make real contributions to society, as well as training with online simulations that recreate the complexity of business decision-making.

Know someone with entrepreneurial potential? Find out more about ESCP’s Bachelor in Management (BSc) and download the brochure

Berlin: a big attraction for global talent 

Germany’s capital has earned a reputation as one of the world’s most vibrant and energetic startup centres. The city’s culture, history and sheer hipness have made it a big attraction for international talent who want to change the world through their ideas. 

There was, at least at one point, a startup being founded in Berlin every 20 minutes. Coworking spaces and hubs like Betahaus and Factory epitomise the creative atmosphere of the city, helping innovators to make new connections and drive projects forward.

E-scooters are now a key part of sustainable urban transport systems in many European cities. Berlin-based TIER only launched in 2018 but already has 60,000 scooters across 80 cities in ten countries. The firm is not only the market leader in the competitive ‘micro-mobility’ sector but is also already profitable – far faster than many big name startups manageEurope-wide entrepreneurial hotspots

The Spanish startup scene was slow to develop. But Madrid is making up for lost time and is one of only seven cities globally to have a Google startup campus. It’s also home to a number of unicorn companies – valued at more than $1 billion – such as ride-hailing app Cabify and rental homes company Spotahome.

The Italian tech ecosystem has also developed in recent years, especially in northern Italy. More international investors have begun to take an interest in the region as it has become a more favourable location for entrepreneurs.

In the north, Stockholm is home to a thriving tech scene that has helped Sweden rank first globally for capital invested in startups per capita. The city is home to the Action Against Corona initiative that supports startups that can help fight the pandemic or its social effects.

Eastern Europe also has plenty of startup talent. While funding is not always easy to find, Warsaw is home to Experior Venture Fund – Europe’s first venture capital (VC) fund set up and managed by women. Cofounder Kinga Stanislawska also established European Women in VC to help increase female representation across the continent.

Many of tomorrow’s entrepreneurs can be found today studying business programmes such as ESCP’s Bachelor in Management (BSc). ESCP’s student societies include VConnect, which aims to create a bridge between innovative students and the VC ecosystem, and ESCP Women in Leadership, which focuses on inclusivity and gender equality. 

Know an entrepreneur of tomorrow? Find out more about studying at ESCP Business School

For members

STUDYING IN GERMANY

What’s it like to study abroad in Berlin?

Picking the right city to study abroad in Germany can be a tricky decision, and there are numerous factors to consider. Freya Jones shares her experience of doing a year abroad in the capital and explains why Berlin could also be the right choice for you.

What's it like to study abroad in Berlin?

Five months after moving to Berlin for my year abroad (a compulsory part of my German degree from the UK) the German capital is certainly a destination I’d recommend. 

Although it’s less “traditionally German” than many other corners of the country, and simultaneously more comparable to the blanket big city experience worldwide, Berlin’s unique history and culture make it a great place to explore – and unsurprisingly very popular with international students. 

Like all capitals, it has its pros and cons, so here’s what stood out to me during my experience so far.

Arrival

You’ve probably heard horror stories about the Berlin housing market, and from experience I can say they’re largely true. Finding an apartment here before moving to the city is notoriously difficult, and more expensive than in other parts of Germany. 

What you should bear in mind, however, is that unlike other German cities, Berlin doesn’t impose fines if you’re unable to secure a registration appointment within two weeks of arrival (three months if you already have a visa). This makes searching for a good WG, Studentenwerk, or other rental far easier post-arrival if your first stop is a homestay or somewhere else temporary. 

Blocks of rental flats in Berlin.

Blocks of rental flats in Berlin. Photo: picture alliance/dpa | Monika Skolimowska

Despite a recent wave of strikes and construction work, transport links in Berlin are still very strong. If you’re enrolled as a student during your year abroad, you’ll be entitled to a discounted pass for city transport, including a number of tram, bus and train options that run all the way to the city’s outskirts and even into Brandenburg (Zone C).

What’s more, direct trains from Berlin’s BER Airport make it more accessible than more remote locations in Germany when you arrive equipped with a year’s worth of luggage.

English

My German tutors in the UK were slightly concerned when I chose Berlin, because they didn’t think I’d have much opportunity to practise my German. Looking back, this worry wasn’t without cause, and if your primary goal is German language improvement, it may be worth considering somewhere more rural or less international. 

Unlike small towns I’ve visited elsewhere in Germany, where many people speak little to no English, it’s everywhere in Berlin. Because the international population is so large, new friends from any country are likely to speak it by default.

However, this can obviously be mitigated by signing up for German-only university classes, as I’ve done as an exchange student at Humboldt University, or finding a German language job. And on the flip side, if you’re here to study a discipline other than German, the ubiquity of English in Berlin has you covered.

READ ALSO: The top German cities for international students in 2024

Cultural Experiences

Unsurprisingly, Berlin offers no end of unique cultural experiences. For new arrivals, there’s plenty to fill your time with, and I’d really recommend “playing the tourist” for a couple of weeks while you settle in. 

Bucket-list locations include the National Gallery and museums on Museuminsel, the Berlin Wall memorial, the Brandenburg Gate, and the site of the Berlin airlift at Tempelhof. And beyond this, there’s never a shortage of things to do – walks around Tiergarten and the customary Sunday flea markets (Flohmarkt am Mauerpark being the most famous) are popular with visitors and locals alike.

A skateboarder performs tricks on Tempelhofer Feld

A skateboarder performs tricks on a former runway at Berlin’s Tempelhofer Feld, a popular meeting place in Berlin-Neukölln. Photo: picture alliance/dpa | Christoph Soeder

Something I’ve also really enjoyed after being here for a while is noticing the small details which differentiate the former East and West Berlin sectors, such as different traffic lights and types of transport. While much of the architecture is admittedly stark, grey and not as pretty as other parts of Germany, the way in which present-day Berlin is a visible product of its recent history makes it a fascinating place to live.

READ ALSO: How do I get a student visa for Germany and what does it let me do?

Pros & Cons

Any culture shock inevitably comes with both positives and negatives, and these are a few which particularly struck me after moving to Berlin from the UK. 

Cons: many shops refuse to take card payment and only accept cash; all shops and supermarkets close on Sundays; there’s no guarantee of being let into a club or bar on a night out, and the traffic lights genuinely seem to conspire against drivers and pedestrians alike. (Also, the weather in winter really will destroy your soul, and this is a Brit talking…)

Pros: the quality of food is much better here than in the UK, and cheaper; the cost of alcohol is much lower; public transport is cheaper and more efficient than in London; work-life balance and mental wellbeing are taken very seriously; and finally, there’s a far less visible “class system” than in the UK, possibly due to the greater access and affordability of German universities.  (This is really nice, especially if you’re coming from a UK university where socio-economic prejudice is very common.)

READ ALSO: How to stay in Germany after graduating from a German university

Overall, Berlin has been a vibrant place to spend my exchange semester. Not only has it given me insights into the most significant shifts in recent German history, but it also offers the archetypal experience of living in a bustling, multicultural city. So while it’s distinctly different to anywhere else in Germany you might be considering, the variety of things to see and do in Berlin will keep you engaged for your full year abroad.

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