Make way London, Hamburg could be set to replace you.
Clearly, while London may still be an attractive destination for investors looking for solid returns, the city is facing challenges ensuring it can provide a viable base for entrepreneurs looking to grow their business.
With Brexit set to add more complexity in the form of talent shortages, unstable economic conditions and further market uncertainties, London would do well to pay attention to other European cities that are nipping at its heels, such as Hamburg. The promise of foreign but established business support networks that go above and beyond to cater for burgeoning new companies is a lure that could be too strong for some entrepreneurs.
Tapping into a wealth of business knowledge
Hamburg is one such city that is ploughing significant resources into developing a network of mentors and investors, to help position the German city-state as a leading destination for startups across Europe. While Berlin often claims the title of Germany’s startup capital, Hamburg actually boasts one of the healthiest and active markets for fledgling companies.
The Hamburg startup scene shows some interesting trends; commerce is by far the most active space, followed by service-based startups and tech coming in third. Although the startup gaming industry only boasts 24 new companies, they are by far the biggest employers with collectively over 1,500 staff.
Fintech also shows a similar trend, with 28 active startups employing more than 500 people. What is even more interesting is the stage at which most startups currently sit in their company development; the majority are solidly within the growth phase, which means there is a significant potential for seed investors.
What’s more, Hamburg is the European headquarters of some of the tech world’s biggest brands including Xing, Freenet, Google and Facebook. With a long business history including the operation of one of the world’s oldest and busiest shipping ports, the city also has an impressive list of established businesses – such as Airbus, Philips and Siemens – that are all on the lookout for the next big tech innovation in their industry.
Acceleration in the startup scene
Where big businesses play a real role in Hamburg’s startup scene is through the city’s collection of accelerator programmes. Hamburg runs three separate programmes for startups across different industries including logistics, media and ecommerce.
Each programme calls on companies like Airbus to provide expertise, mentorship and funding for a handful of carefully selected startups that they believe can help transform the industry through tech.
Any entrepreneur out there is well-aware of the years of sweat and tears that are spent on building a company from scratch. Hamburg’s accelerator programmes are designed to give startup founders the support they need to ensure that any barriers to their business are tackled in partnership with those who have the skills and resources to help solve challenges. The collaborative nature of Hamburg’s startup ecosystem is a significant key to its success.
A platform for European success
With Hamburg’s business community investing heavily in its startup scene, companies that find themselves beneficiaries of the accelerator programmes are perfectly positioned to take on new markets. Armed with the capital injection and new knowledge of how to expand and scale their business, many of the startups have seen their businesses grow across borders.
Founder of media tech startup Sceenic, Paul Bojarski, puts much of his success down to his involvement in the next.media accelerator. “The six months that I spent with the Sceenic team in Hamburg, getting access to industry experts and some of the country’s biggest media companies, was invaluable. It wasn’t only about the money or funding, but the incredible support that we received from the next.media team along with the leaders in the media sector, and the investors themselves. The programme is incredibly hands-on, which made all the difference to our business,” Bojarski said.
Bojarski and his team are now in talks with a major media company in the UK to provide their platform to British viewers as part of a pilot programme, and they have already secured a contract with the broadcaster NDR in Hamburg to be used during the Eurovision song contest. Clearly, the power of Hamburg’s accelerator programme translates to the real business world.
It will be interesting to watch the startups that come through the city’s innovation ecosystem – who knows, maybe Europe’s next unicorn will call Hamburg home.