Starting Something: A Berliner Startup Dilemma

Young internationals are flocking to Berlin to start businesses ranging from coffee roasters to Scottish pubs, showing a spirit of entrepreneurship that would seem more at home in an American history textbook than a 21st-Century European capital. With Berlin's era of squats set firmly in the past and Germany's notorious bureaucracy working as slowly as ever, why are these people still coming?

Topsy-turvy bar and venue Madame Claude was founded in 2007 by Jean-Christophe Simon and two friends from his home in southern France. After years of living apart in the western European capitals of London, Paris, and Madrid, they visited Berlin together for a weekend and felt… something. "It felt like you didn't need anything but enthusiasm to start something. It wasn't like London, where you had to have investors. Or Madrid and Paris, where you need connections just to get started. We felt like all we needed was energy." They weren't the only ones. When they started, the most foreign business in the area was the McDonald's across Skalitzer Straße. Now there's an Australian owned café, a Russian-themed bar, a Mexican restaurant, and a yoga studio all within a couple blocks of Madame Claude. And this isn't unique to the Wrangelkeiz. One only has to walk down busy Graefestraße or tree-shaded Maybachufer to see storefront after foreign-lettered storefront stretching into the distance.

Berlin has long been a city in flux. The war and years of division conspired to slow development and produce a disjointed and uncoordinated city, with no real center to speak of. Population has yet to return to prewar levels, and manufacturing jobs have dried up, leaving desiccated industrial husks scattered across the fringes of the cityscape. The advent of Instandbesetzung ("rehab squatting") in the early eighties inaugurated a spirit of occupation and collective participation that became central to the Berliner ethos. Now people from all corners of the world come to Berlin to start businesses, sensing opportunities in areas ranging from gastronomy to nightlife.

It helps that German law is uncharacteristically friendly toward business-minded foreigners. EU citizens have the same rights as Germans, and actually, those unfortunate enough to have been born outside of Europe don't have it especially bad either. "Foreigners need to have residency and prove they have the capital necessary to start a business," Kris Shackwell, co-founder of Five Elephant Coffee said, "it helps to show them that you're going to hire Germans. They like it if you're going to create jobs. If you have all the things you need, there's no reason you won't be allowed to start a business." But as it turns out, getting permission is only half the battle.

To get the necessary papers, potential business owners must prostrate themselves before a host of bureaucratic entities, including the Industrie- und Handelskammer, the Ordnungsamt, and more than a few tax offices. "The Ordnungsamt in particular felt like a Kafka novel; there were unlabeled doors everywhere, long, brightly-lighted hallways, and stress-out looking people coming to us asking if they were in the right place, when we didn't even know where we were" explained Rachel Burns, co-founder of Das Gift, a bar in Neukölln. "We were having problems with our status as a Raucherlokal—a bar where smoking is allowed. The guy denied our application, saying that the room was against regulation, but wasn't able to tell us exactly why. He just knew it wasn't. We ended up having to put up a plexiglass wall to divide the room in half, and made one side a smoking room." She shrugged. "I still don't really get it."

Perhaps more absurdly, Kris of Five Elephant was forced to set up a customs-free international zone inside his coffee shop to comply with the differing regulations for raw and roasted coffee beans: "Essentially, when they come out of the roaster, I have to pay an import tax of about €2 on each kilo that comes out. [he laughs] There's no way we could have done this without our tax adviser. Even she didn't know about that one."

Five Elephant has also dealt with less officially-sanctioned resistance to its arrival. Since opening in December 2010, the shop has been hit with xenophobic graffiti more than once. Kris thinks the aggressive scrawls add character to his storefront. He chalks the hostility up to the lower-income housing projects down the street, adding that he gives discounts to all the people who live in the neighborhood and has generally felt very welcomed. "Everyone in the neighborhood apologized when they saw the graffiti. I don't think it represents the general feeling here at all."

Therein may lie the reason new businesses keep popping up here. Berlin is simply more open, more ready to accept new ideas and experiences. "There's a lot of potential to make things happen here. Other cities seem more set in their ways, more static. I think it has a lot to do with the wall coming down and all of these desolate industrial spaces opening up for cheap. It feels like a new city, even though it's old" says Rachel from Das Gift, "Berlin has a tradition of migration, whether it admits it or not. Look at the Turkish people. Germans used to come to [West] Berlin to escape military service. Now a lot of foreigners are coming. It seems like the city is ready to accept people. The people who come here, it's a particular type of person, someone who is open to new things, willing to try them out."

It's this enthusiasm for new ideas that contains the key to success in Berlin. Kris has this advice: "I've seen other businesses open, typical Berlin cafés, and they sometimes struggle. You get a breakfast with cold cuts, cheese, a little Brotkorb—it's all the same. In order to survive, to thrive in this city, you need to give people something new, something you're passionate about." Says Jean-Christophe of Madame Claude, "Don't come here to get rich. Come here for more space, for less stress, to make a living doing something you love."

By Conor O’Rourke 
Conor is a freelance writer and editor living in Berlin. He likes bikes, rap music, and tacos. Find more of his work at

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