Lifestyle

They set up shop in a ramshackle seven-person bedroom/office above Café Sankt Oberholz on Rosenthaler Platz. Within a few weeks, the first private beta version of SoundCloud was online and in use for the sending and receiving of music.

Ljung has noticed that business culture in Germany takes a different tack: people start out a bit gruff and then gradually warm up to their partners. But because Berlin has such a “great feeling, great people and great audio software scene”, the bureaucratic hassles, language challenges and hard business exteriors are worth it to him.

SoundCloud remains happily ensconced here in this gritty city – so much so that Ljung and Wahlforss recently turned down an attractive opportunity in London.

Geeks are happier here

While Berlin may seem to be an obvious match for a music-based company, the hightech start-up network is becoming so strong now that even fields not traditionally associated with the city are pulling in global talent.

Fabienne Serriere, co-founder of Doctr.com - an online platform for doctor-patient communication - seems at first glance like one of the least likely people to found a company here. A French citizen and fluent French speaker, she grew up in northern California. Both San Francisco and Paris are known as fertile ground for start-ups; in both cities Serriere already had the social network and the language skills that would allow her to glide through the typical bureaucratic hassles that a new company encounters.

But about five years ago, Serriere ended up as a last-minute replacement guest at a 150-person, invite-only hacker event in Berlin - and she immediately fell in love with the city. She did not know any German, but found “good and interesting people that grew up before the Wall came down; mostly old-school hackers from the East... People who had been involved with the European computer and security scene for a long time.”

At the time, she was living in France and considering moving back to the States because her “attitude did not fit in with the French culture towards women and technology”. Being a vegan, neither did her food choices. But, instead, she moved to Berlin where, three years later, she met physician Kai von Harbou at a networking mixer. The two founded Doctr.com, an online platform that uses encrypted webcam chat sessions to facilitate and increase communication between patients and doctors, and offers community-building tools for doctors who “often miss out on interdisciplinary exchanges of ideas and information sharing”.

The company will remain in Berlin, Serriere says, because “geeks are happier here. In a geek company, you want people who are generally more satisfied with their lives. Well-adjusted people who are very creative and fast coders. The geek community and quality of life here is much better than in other cities, and the programmers are super intelligent and knowledgeable, smarter than the average... In addition, the food is good and cheap - and the quality of living is great.”

Serriere says that the geek scene here has just “exploded in the last year and a half”. The world’s crumbling economies have had little impact on the Berlin start-up scene, since “it already had a crappy economy as well as really good computer science programmes at TU [the Technical University] that continue to draw students to the city”. While the old-school hackers are what originally drew her in, Serriere has also used this expanding pool of talent to build her company into a global competitor that can rival any in the cities she left behind. She, for one, is staying put.

TechCrunch, a popular San Francisco-based tech blog, noticed the trend too. It held its first-ever offline Berlin meet-up at the Jamba headquarters in June 2008. Tickets for the second TechCrunch Berlin event in June 2009 sold out within weeks. Shortly before the event, people were posting pleas for those coveted €40 tickets on berlinwebweek.de. It’s quite unusual for a business-oriented event in Berlin to charge so much - and even more remarkable to see so many people scrambling for entry passes.

Clearly, the high-tech scene is alive and flourishing: this event was sought out because it offered access to deal-making and other insider action. The networking energy and media attention highlighted by TechCrunch will only continue to increase the strength of trends that have already been set in motion. In fact, it may be that in a few years, this “poor but sexy” city will have turned into the high-tech creative hub of Germany - a place that all young, international entrepreneurs visit to connect with talent and resources not found anywhere else.

Berlin start-ups in numbers

• On average, the number of start-ups is twice as high in Berlin as it is in the other Bundesländer. In 2008, the city boasted 39,100 start-ups, while Hamburg had only 20,200, Munich had 17,300 and Cologne had 12,400.
• Berlin has been particularly fertile ground for web-based startups. According to www.deutsche-startups.de, in 2008 Berlin ranked number one in Germany, with a total of 128 web startups, versus 118 in Munich and 78 in Hamburg.