Tagstartups

Berlin Night @ Tokyo (slides)

B

As part of a Berlin delegation of technologists, startups and connectors, Bistream kindly invited me to Tokyo to speak at a number of events and meet the local tech, startup, hardware, IoT and innovation scene.

Part of this was a presentation at Samurai Startup Island (event link, Japanese), one of Japan’s top startup incubators. I spoke about hardware startups and the Internet of Things, commonalities and potential of an exchange of ideas/skills/talent between Tokyo and Berlin, and about ThingsCon.

 

Slides below. Enjoy!

 

The year of the connected device, but consumer IoT startups face big challenges

T

Over on the BoschSI Internet of Things blog, I contributed a short piece on the challenges that startups in the consumer IoT space are facing.

There is hardly any doubt that 2014 is the year when connected devices – particularly wearables – will go mainstream. Technology tradeshows and media alike are practically bursting at the seams with new products, concepts, and announcements for connected devices.

It’s worth noting that this is quite a special slice of the Internet of Things: this isn’t about the industrial internet, it’s about bringing the IoT to consumers. This is a very different story altogether, a segment with its own opportunities, challenges, and dynamics, one that exists at the intersection of various verticals – think home automation, wearables, connected mobility, personal analytics, health tech. It’s a space where the lines aren’t yet fully drawn, the terminology not yet fully evolved – which is usually a sign of a field that’s moving quickly and innovating. In other words, this is where some truly innovative and interesting stuff is happening.

Read the full text here.

Startups: If you want to earn money, get your invoices right.

S

International rollout is hard for startups. There are complex, tough questions to sort though: legal regulations, cultural differences, language and interface barriers to name just a few.

And then there are issues that are really, really easy to fix. Those shouldn’t get in the way.

One of them is invoicing. There are some questions there that are not completely trivial, like when to charge VAT and how much. Asking your tax advisor might be the only way to sort out these questions, but you can do this gradually whenever a new situation comes up. So over time you build a knowledge base (template base even) that makes it easier over time. But most of the time, invoicing is easy.

Here’s an invoice generated by FancyHands (with the help of Recurly):

 

Invoice 36427 Fancy Hands Screenshot of FancyHands invoice, lacking all kinds of information to meet German legal requirements.

 

Note that there’s not even information in there that I need to edit out in the image? About me, it contains ONLY a zip code and email address. About FancyHands, only the logo.

More importantly, it doesn’t mention how I paid, or what company is behind FancyHands’ logo, or where my company is registered.

(At least it does mention the amound and the currency (USD), which is a start. Also, a date.)

Earning money with a startup is possible. In fact, for this service I happily paid. (I even wrote a lenghty, indepth side by side comparison of FancyHands and local competitor AskGeoffrey.) What you really don’t want to get in the way of earning money is your invoices.

Getting invoice templates isn’t a hard problem to solve. Include more information — the company knows its own address, and mine, too — rather than too little, and you’ll be set for most jurisdictions. Otherwise your customers will go to the local competitors.

As an extra service, here’s a list of requirements as researched by FancyHands own researchers on my behalf. I didn’t double check, so use at your own risk. It does look pretty ok, though:

Reference http://fncy.it/14FKtW6 (proz.com) Information that invoices must contain

  1. Full name of the service provider.
  2. Complete address of service provider.
  3. Full name of recipient.
  4. Complete address of recipient.
  5. Service provider’s tax number (Steuernummer) or VAT ID (for those liable for VAT).
  6. Recipient VAT number, if recipient is VAT-registered.
  7. The date of issue of the invoice.
  8. For all invoices, a unique (alpha)numerical identifier (a simple serial number suffices).
  9. A brief description of the service(s) provided.
  10. The date or period during which the service was provided.
  11. An itemised list of each service provided with the unit price (e.g. €65 per hour), the total amount for each service, and the grand total, or a fixed charge, without VAT.
  12. For a final invoice, all advance payments (for which invoices also have to be issued).
  13. The amount of VAT and the rate applied. If VAT does not apply (only for those liable for VAT), a simple statement explaining why.
  14. The (grand) total including VAT.
  15. Any discount granted before VAT and the discount rate applied.

TL;DR: Some problems are hard to solve. Invoicing isn’t.

Recent reading (7 links for March 21)

R

matze_chinatown and manhattan bridge-025

Irregularly, I post noteworthy articles I recently read. Enjoy!

 

Nike, TechStars Unveil Startup Accelerator Winners
A quick overview over the first round of winners of the TechStars accelerator program focused on Nike+. – by Austin Carr (link)  

 

Why Wait For Google Fiber? UK Farmers Want Faster Internet, Build Their Own
A group of farmers self-organizing a 1GB fiber connection? Hell yeah. – by David J. Hill (link)  

 

Why I left Google
The quiet, calm tone of voice of this “why I left Google” story makes it almost touching. The core point, though, is an important one: “The Google I was passionate about was a technology company that empowered its employees to innovate. The Google I left was an advertising company with a single corporate-mandated focus.” – by James Whittaker (link)  

 

Everything you need to know about Moleskine ahead of its IPO
Moleskine has a profit margin of some 41%. That’s somewhere in the region of what Apple makes on hardware. Insane. – by Zachary M. Seward (link)  

 

Things publishers can’t do (yet)
Charlie Stross shares his – well informed – thoughts on how ebooks could and should be treated very differently from hard and soft cover paper editions. – by Charlie Stross (link)  

 

3 Ways To Make Wearable Tech Actually Wearable
Some solid ground rules on how to make better wearable tech. – by Jennifer Darmour (link)  

 

The Future of Product Design is Localized and Democratized
Hardware innovation & startups as the byproduct of an itch that needs scratching in your immediate area/peer group. – by Theodore Ullrich (link)  

Is Berlin made for you? Are you made for Berlin?

I

Update, Feb 04, 2014: Someone just asked on Twitter how much this post is still applicable after two years. I’d say if you move up the sliders for “startup ecosystem maturity” and “cost of living” by a notch or two, it still holds up. (Fun fact regarding some companies mentioned below: Soundcloud and Readmill are still going strong, Amen and Gidsy have been sold – which confirms my previous points.)

That said, here goes the original post…


At least a couple of times each month, someone pings me to get a better feeling for Berlin. “Do I want to move there with my background and in my situation?” I try to share what I know and help when I can. The pure number of times I’ve discussed this in some way or another merits a few notes.

Please note that I don’t work in a startup myself, even if there’s a lot of startup in my life. So I’m somewhat of an outside observer here, but hopefully it’s helpful anyway.

Is Berlin Europe’s startup capital?

The answer is a loud and clear: maybe. There’s tons of hype around Berlin. Where there’s hype, there’s hyperbole. So take it with a grain of salt. There is a (quickly growing) number of high potential startups. My impression is that this is mostly thanks to a very small and tight-knit group of young entrepreneurs. Over-simplifying a bit, I’d say that the good folks at Soundcloud kicked it all off, followed closely by the also great folks of Readmill, Amen, Gidsy. It’s no coincidence that there’s lots of love between these companies on all levels. Now there’s critical mass of sorts, and that attracts more interest of other entrepreneurs, of VCs, Angels etc. A virtuous cycle. The beginning of an ecosystem.

We’re seeing the early stage here, the tip of the iceberg. Let’s be clear: In terms of maturity of this ecosystem, Berlin is nowhere near Silicon Valley, New York or London. But there’s tons of potential. Give it a year or two and the first round of exits and we’ll see more money and energy pumped into the overall ecosystem.

The lifestyle factor

Berlin scores high on the “soft” factors. Work hard, play hard? Berlin is strong there. Costs of living, though rising, are low compared to London, Amsterdam, New York or San Francisco. Apartments are bigger, stress is lower, beer is cheaper.

Berlin’s nightlife is always hailed as the one of the world’s most energetic and eclectic. Probably true. But what if you don’t go clubbing three nights a week, or three days non-stop around the weekend?

Bonanza Coffee Heroes

Worry not, there’s plenty to do. Berlin sports fantastic restaurants, a blossoming coffee shop scene, and entertainment of the more traditional (theater, opera, galleries) as well as more cutting edge varieties (digital arts, activities of all sorts). You name it, you’ll find it.

Berlin is a cosmopolitan, open, multi-cultural city.

Is Berlin made for you? Are you made for Berlin?

So, we established you won’t get bored. There’s other factors that merit consideration.

In Berlin, you’ll also often encounter a strong anti-corporate, anti-commerce, anti-gentrification attitude that often surprises Americans visiting town. It’s part of Berlin’s history and part of a larger global narrative. Sometimes it takes some odd shape or form in Berlin, but it’s something worth considering.

In Berlin’s bars and restaurants, it’s not uncommon that smoking is allowed (and practiced heavily). Smoking was banned in restaurants a while ago, but after a series of lawsuits and appeals I’m not sure what the legal status is exactly. I can tell you, though, that while it’s possible without too much hassle to find a non-smoking restaurant, it’s a very different story for bars. I’m not judging either way, but it’s important to know as it might have an impact on your life if you move from San Francisco, London or New York.

This being a big city, you’ll find just about any style. Yet, the part of Berlin that most startup hype articles talk about is mostly centered around the four districts that after Germany’s reunification – that brought down the literal wall dividing the city – that lived through the gentrification fast track: Mitte, Prenzlauer Berg and Friedrichshain formerly were East Berlin, and the reunification led to a mass exodus of the former inhabitants, leaving behind run down houses that offered ultra cheap rents. Squatters, artists and students moved in, creative industries followed first, then rent hikes, renovation, more mainstreamed lifestyle. You know the story, it’s the same as similar neighborhoods around the world – just maybe a bit faster. Kreuzberg is the fourth of the districts. The only one in the former West (don’t try to match East/West on the map, it won’t work in Berlin, Kreuzberg is actually in the South East corner), Kreuzberg used to be fairly poor and predominantly Turkish and left-ish. It was the hotbed of Germany’s 60s student revolts and – from 1987 until just about last year or so – featured annual Labour Day riots (Wikipedia de/en).

Old factory building, Berlin

All this stuff is just to give you a better feeling of why some things seem different here: It’s because they are. History runs deep in Berlin, and it’s all pretty recent. The wall came down about 20 years ago, in some backyards you’ll still find bullet holes from WWII. That’s also why Berlin is changing so fast. It’s a canvas, and it’s painted and re-painted by lots of folks simultaneously. Startups are just one of many forces at work.

Berlin Streetart

Berlin isn’t Germany

The city plays a special role within Germany. It’s the capital, but it isn’t all love. Berlin’s debts are ridiculous (some 60b), there’s no traditional industry to speak of, unemployment is high. For decades, Berlin lived off subsidies, which led to great universities, operas and museums, but also has never been financially self-reliant. Many German stereotypes won’t hold true in Berlin, which is probably a good thing. Just don’t confuse the city with the country. Again, it’s the same in most countries – New York is hardly really representative of the US.

Language and cultural barriers

In the startup world, everybody more or less speaks English. On the street, in the districts mentioned above, you’ll get along with English as long as you’re not asking for things all too specific. Bars, restaurants and shops will be able to help you in English, but maybe don’t try to negotiate some complex nutritional detail. I highly recommend learning at least basic German, as it will dramatically improve your experience.

Kjosk

Office hours and shop opening times might seem odd to some – Sundays are mostly closed, Saturdays can lead to different opening times, restaurants sometimes close on Mondays. There are some rough patterns, but in Berlin often times things are improvised, so if something’s closed when you expect it to be open, don’t sweat it. It’s not uncommon that a cab or restaurant won’t accept credit cards, so make sure to bring cash. Service is usually friendly, but not necessarily provides the level of thoughtfulness or attentiveness you might appreciate in London. The dominant style is shabby chic, which is where Berlin scores high.

You got to like that, or Berlin isn’t for you. Personally, I love it, so I’m in heaven here.

BHC

Also, sometimes visitors mention that the city seems very laid back. That’s because it is, which is both boon and bane. There’s less hassle, less hustle. Coffee meetings can easily take an hour or more as personal lives are discussed along with business, and office hours start comparatively late (don’t try calling a startup or agency before 9 or 10am). Some call that slacking, others call it quality of life. You’ll have to judge for yourself.

What about my partner?

If you consider moving here with a partner or family, you might want to consider the options. Maybe for a time one job might be enough to support two or more as costs of living are lower. On a startup salary? Maybe not so much. The overall economy is weak in Berlin. So if your partner works outside the startup world, things might get more tricky. There will be less jobs available, and in most other industries German is the predominant (often only) language spoken inside the company. I don’t know enough about English or other language schools for your kids, so you might want to inquire ahead. Ask the expat you trust – one of them certainly lives in Berlin. Also, German paperwork can be tricky, so you might want to talk to a relocation service to take the hassle out of moving so you can hit the ground running.

These are some of the main things I think it is important to be aware of. If that sounds good to you, then you’ll love it here. If not, then maybe London or NYC will be a better match. Hope that helps with some of the early stage questions. Did I forget anything?

Something is happening in Berlin (you can feel it in the streets)

S

It’s no secret that I’ve been a fan of Berlin for a long time. (That didn’t happen until after I moved here, but that’s a different story.) So far, that was mostly for personal reasons: I moved here to study, I have friends here, the city is interesting and quality of life is fantastic – that is, if you like the run-down, alternative charm and everything-goes attitude of Berlin.

Besides, Berlin is a city of layer upon layer – of history, of social issues, of politics, of subcultures. Economically Berlin has been a wrack for ages – largely because of the separation and its effects that you can still feel today even though the Wall has been gone for 20 years: This is, after all, a city where “real” (read: brick and mortar) industries hardly had a chance. So even today, the biggest sectors besides tourism are politics and media.

More recently, though, another layer has been been added, and another sector is emerging, and strongly. Tech startups. While it has become a bit of a running joke that if a web service exists, there is a German copy cat of it, Berlin has become a place where young entrepreneurs (both German and international) come to build their new companies. The reasons are manifold, but there is a common pattern: Relatively cheap rent, high quality of life, good nightlife and a laid-back atmosphere take a lot of the hassles away that you have to deal with in other places.

That’s worth something. Maybe even enough to put up with the iconic German bureaucracy.

As many of my friends work in this new startup environment I’ve been watching this space closely, and there’s fantastic energy there. Now the press is catching up, and so are VCs: Hardly a week without some article about Berlin as a new European startup hub, or news that this VC or that plan to open an office here. There are closed-door, intimate lunches and open networking meetups galore, parties, everything.

There are two sides to that coin, obviously. Yes, there is tremendous stuff going on right now, which is fantastic. But it also shows (painfully, I’m tempted to add) all the things that hadn’t been happening before. That said, the trend points to a good, healthy future as this ecosystem is emerging.

So when I read this announcement about an anti-copycat alliance of Berlin-based startups it made me smile. I had heard the conversations before, but it’s good to see this made explicit, and to see so many friends directly involved. This shows that there’s a common denominator, a common spirit that ties this scene together more strongly. They – we – are getting bolder here.

Can’t wait to see where we can take this.

Update: Derk Marseille, a Dutch journalist who has been working from our office on and off for a little while, has kicked off a neat new podcast to capture that spirit: Radio F@6 – not to be confused with our after work drinkup #FatSIX.