[mhomde]

I think Berlins "Poor but happy" times are fast coming to an end. Rents have been rising quickly the last few years and tech companies and startups becoming more prevalent. Heck, Neukölln went from being a cheap alternative to being as trendy and expensive as Kreuzberg.

Berlin kinda, from what I understand, enjoyed it's special culture much because it wasn't an industrial city and lacked an large international airport, but cheap rent, international vibe and fun hipster values seems like the perfect void for tech to move into now that rents and prices in the usual "big cities" have gone through the roof. I can also imagine cities like Amsterdam and Berlin getting some Brexit escapees.

Mark my words, Berlin will be Europe's Silicon Valley within a few years.

[biztos]

I agree completely that "cheap Berlin" is rapidly disappearing. Just this morning I was checking real-estate prices[0] for the first time in a few years and was a bit shocked. Folks in Silicon Valley or Munich or Hamburg would probably still find it cheap-ish but AFAIK local salaries have not remotely kept up with this trend. A million Euros for a nice family-sized flat in a good neighborhood is not exotic anymore, but for most Berliners that's an absurd sum.

Another interesting thing is that there are more and more ways to spend more and more of your money in Berlin. Consumerism is definitely on the rise, which IMO is bad news for people not making much money.

I wouldn't say Berlin lacks an international airport, I would say instead that the corruption/incompetence nexus managed to spare us the monstrosity of BER[1] and we can continue to use the lovely old urban airport at Tegel[2], though granted there are a lot of stopovers depending on where you're going.

Anyway I really doubt Berlin will be anything like Silicon Valley, well, ever. You could start with how radically differently the local tech scene views labor, but that's just the tip of the iceberg. I would love to be wrong though.

[edit: formatting]

[0]: https://www.immobilienscout24.de

[1]: https://en.wikipedia.org/wiki/Berlin_Brandenburg_Airport

[2]: https://en.wikipedia.org/wiki/Berlin_Tegel_Airport

[hknd]

Rents (and cost-of-living) are still super cheap compared to other metropolises like NYC, London or Singapore. Ratio of salary and cost-of-living is still looking good in Berlin.

[walshemj]

How do you think the views on labor differ between SV vs Berlin ?

[LifeLiverTransp]

Its all those riches from authoritarian countrys fleeing to "safer/stable" countries.

A millionaire in a party state is one head of states headache away from loosing it. And they know it.

[guywhocodes]

As someone traveling between Europe and Asia a lot and a former resident in Berlin. IMO Berlin is far from having an international Airport, it has two European airports but flying there means transiting somewhere. I appreciate Tegel tho, only airport in a capitol I've been able to make a flight when still in the cab 30min before take off. Less than 4h door to door between my appartment in Berlin and my friends in Stockholm.

[raverbashing]

Oh yeah, BER is a very expensive joke at the moment.

[aestetix]

I think this is overblown. The Berlin "housing crisis" is only happening in a few trendy neighborhoods-- Neuköln, Kreuzberg, F-schein, etc.

There is a rather ill-informed effort to attempt to compare it to, for example, what is happening in the Bay Area, which is absurd. In the Bay Area, any place to live within walking distance of public transit is so expensive that only tech workers can afford it, extending far beyond the San Francisco/Oakland city limits. In Berlin, if you don't mind living in one of the less "cool" neighborhoods, or gasp outside the Ringbahn, you will be fine.

I think the issue is that two decades ago, rents in Berlin were absurdly cheap for a number of reasons related to the DDR, and now things are starting to normalize a bit so people are complaining.

[uhnuhnuhn]

The Berlin housing crisis is very much happening almost everywhere. City-wide average rents increased 45% between 2009-2015. Rents doubled in some districts in that timeframe and even in the least affected areas (Marzahn and Spandau) rents increased by more than 30%.

[scandox]

Even 5 years ago when I spent 3 months in Berlin the idea of calling Neuköln trendy would have seemed pretty nuts. So I think that suggests something radical is happening.

[erikb]

Even in Lichtenberg, certainly not trendy at all, rents have increased significantly (although not doubled yet afaik).

[drinchev]

> Berlin will be Europe's Silicon Valley within a few years.

Things that need to happen before this :

1. Salaries need to grow faster. Rent is really high for the new comers specialists.

2. Companies need to increase the salary gap between good and bad workers. Right now you are not able to negotiate more than 10% on top of the "average" salary.

3. Germany needs to fix the privileges of employees having options / shares of the company. With the current legislation / founders attitude is quite boring and useless.

[valarauca1]

> Salaries need to grow faster

Berlin software engineer salaries are seriously worse then any where in america. I’ve seen desktop IT support in the US MidWest pay more than developers in Berlin.

Hard to convince me to move internationally and write code. I can just move home, write zero code, and spend all day telling people to try, “turning it off and on again”. Cashing identical value checks.

[mhomde]

Yeah I guess that's what stemming the tide :) Also a lot of German companies seem to require that you speak German. I know awesome programmers/designers living in Berlin but if they work for Berlin companies they seem to earn a pittance of what they'd would in for instance Stockholm. But if more tech companies, like Soundcloud, imports themselves into Berlin and Germany, employees and all, that will change.

Can it be because venture capital hasn't come to Berlin/Germany in a big way yet? Typically German companies seems more aimed at the German market rather than an international one, which maybe doesn't fuel a bubble as quickly.

[wellboy]

4. 100 Founders need to make billion dollar exits to fund universities, vc funds, industries

[saintPirelli]

No way. Europe's Silicon Valley will establish in Eastern Europe, where living is cheaper and governments are more willing to ease up on regulations to accomodate the flexible start-up employer-employee relationships. Warsaw, Sophia, Tallinn, those are the spots to keep an eye out for.

[mstade]

Speaking of Estonia, I was at their embassy in Stockholm last fall and they were pushing hard for Tallinn as the next European capital of tech. Nearly every conversation you had with them, regardless of topic, would somehow gravitate toward how great Estonia is to set up a tech shop. Whether because of cheap real estate or the quality of their work force, or the prevalence of craft beer – it was all just a great place to be.

Frankly I kind of bought it. I'm going to visit this summer.

[fileeditview]

I really think none of these places (including Berlin) will be the Silicon Valley of Europe just because the salaries are too low. Why would talent leave elsewhere to go to eastern Europe and earn significantly less?

[jk2323]

"Warsaw, Sophia, Tallinn"

Doubt that any East European city will be close to a "European Silicon Valley" because of many reasons. Language. Xenophobia. Capital. Location. Culture.

Bucharest comes to mind but because of other reasons. Quite big and Romania has a higher GDP growth than China. But still. no.

[bitL]

The closest to Silicon Valley is London, however salaries there are pitiful. By the time Europe has any attempt to actually create an extremely well-paid bleeding-edge tech hub, that tech will be already in consolidation phase... Dream on.

[danielam]

I usually don't like phrases like "Europe's Silicon Valley" or "Venice of the North". As much as they can be informative in some respects, such comparisons obscure and brush over the specificities of the things in question. It makes more sense to talk about the emergence of a strong tech sector in general terms and as one component of a healthy economy.

Having said that, there is reason to think that the region in question will become Europe's most dynamic and technologically powerful, in particular Poland, because of a number of coinciding factors, such as entrepreneurial spirit lacking in Germany and west of it, geopolitical necessity and historical precedent.

The geopolitical angle is quite interesting. Poland and the other countries sandwiched between Germany and Russia are situated on a geopolitical fault line that demands that these countries cooperate out of mutual interest. Economic strength becomes one pillar in maintaining not just a materially comfortable existence but a matter of existential importance and of independence. That's a pretty strong motivator given the history of the region. On top of that, the United States has a geopolitical interest in the region's strength. We know from analogous cases that American interest of this kind has usually contributed positively to regional and thus economic strength. And from recent developments vis-a-vis the Three Seas Initiative, we are witnessing a formal recognition of the necessity of regional strength by the countries in that region. In fact, the recent brouhaha in the European Commission over Poland is, when interpreted synoptically, a telltale sign of the country's rising importance.

[rurban]

They especially have much better talent, compared to the Berlin ruby/php/javascript hipsters.

[oblio]

Sorry for the hipsters, but Berlin is the capital of the biggest economy in Europe and it was once one of the biggest metropolises in the world plus one of the biggest hubs of economy and science.

It was always destined to go towards its past glory once Germany reunited. The only question was: "how long will it take for that to happen?".

[itsmenotyou]

Two points of contention:

1. It's not just hipsters this is affecting

2. This is not necessarily a move towards "glory". Most Berliners value the arts and cultural scene that exists in part due to low rents/cost of living and readily available performance/exhibition spaces. To see Berlin turned into another Silicon Valley would for most of us here be a major downgrade

[barrkel]

Germany (Prussia in particular) extended quite a ways further east of Berlin when it was capital before; Berlin was the Prussian capital.

It is however very central for Europe, and is fairly well placed for growth in the eastern EU.

[mhomde]

Maybe Leipzig is the new Berlin :)

[LifeLiverTransp]

>Mark my words, Berlin will be Europe's Silicon Valley within a few years.

It might happen- but it still wont have an airport.

[hknd]

Munich is still the city with the most IT jobs and companies - I don't know if Berlin will catch up. Berlin has this start-up flare image, but based on numbers that's just not true.

[dx034]

It'll probably still have two airports.. Luckily the flight to Frankfurt is short and from there you can connect to most places in the world. But wouldn't be surprised if Tegel gets a few more direct connection to the US west coast.

[Mashimo]

Nice overview of the cost involved of trying to build the Berlin Airport: https://www.flughafen-berlin-kosten.de/

[rsynnott]

It has two airports. They're just kind of small and weird (or at least Tegel is; haven't been to the other one).

[_b8r0]

Berlin has two airports, Tegel and Schoenefeld.

[brombeer]

I think it's more likely to be Amsterdam, Zurich or Stockholm.

Large corporations don't want their headquarters in Berlin for tax reasons: There's a reason they're all moving to Switzerland.

The tech scene in Europe is very scattered.

[dx034]

Stockholm has a thriving tech industry and not really low tax rates. Tech can easily headquarter in a low tax domicile and employ most people in another country, all bigger companies are already doing that. I don't think that the difference in income tax explains where tech companies settle, it'll be much more dependent on availability of talent (and how easy it is to get people to move there). That's why Amsterdam, Berlin and Stockholm are so successful, they are all within the EU and have a good reputation with internationals.

[rurban]

So why is the car industry and the chip industry in Dresden then? It's about the talent.

[haywirez]

Not only Brexit escapees but from all over the periphery - it felt like half of Portugal, Italy and Greece was in Amsterdam. Same here in Berlin.

[expertentipp]

> I think Berlins "Poor but happy"

It went „poor but sexy”. The city is still poor but now got wrinkles and gray hairs here and there.

[ksec]

Slightly Off Topic:

I thought Germany has some form of protection by law so rent and property market don't get to hike the prices to whatever they want. So while the world 's property market is on fire by QE, Berlin hasn't moved a needle at all.

So why has rent risen so much?

[taejo]

Germany has fairly strong protection against rent increases for existing tenants: during a tenancy the rent can only increase up to the "ortsübliche Vergleichsmiete" (average rent of comparable properties in the same town), and by a maximum of 15%/20% (depending on location, 15% in Berlin) over three years.

In Berlin and many other cities there's also rent stabilization ("Mietpreisbremse") for new tenants: new leases on old properties may not exceed the maximum of 110% of the "ortsübliche Vergleichsmiete" and the previous tenant's rent. This falls away if the property is substantially renovated.

Renovations can stop both of these from working: in the former case by increasing the value of the apartment so that the set of "comparable properties" is much more expensive, possibly forcing the current tenant out so a new, wealthier tenant can be found to negotiate a new contract; in the second case, the control falls away completely if the value of renovations in the last five (?) years is at least a third of the total value.

The Mietpreisbremse is widely ignored: advertised rents exceed the limit for more often than not, and the landlords choose tenants they think are least likely to sue over it. The worst case for the landlord is that they have to pay back the difference from the point where the tenant complained; the best case is that the Federal Constitutional Court invalidates the law (which is fairly new and not yet judicially tested).

[scalesolved]

This is something that Spain also has (and is being phased out). I live in Barcelona, I pay 1000 euros for my two bed apartment, every 3 years the rent has to be renegotiated. My lovely neighbour who is 92 pays under 100 euros for the exact same flat opposite mine, she is on guaranteed rent protection, my neighbours below who are in their early 70s pay around 250 for the same flat.

The fact rent protection is being phased out makes me really sad, speculation will become even more rife (I can understand that extreme rent protection like above may not be workable but something in between is needed imo).

[passiveincomelg]

They always find some loophole. Often it's some kind of construction work like "improving isolation". AFAIK the rent control laws also don't apply for furnished flats.

[stiGGG]

It's mainly because the rents in Berlin had been comparatively extremely low in average. What happened in the last 5-10 years is more or less an adjustment to other cities in Germany e.g. Hamburg or Munich. But it is a big problem, the typical young IT worker can afford it, but the wages of "normal" workers didn't rise much, so gentrification happened like crazy in all central districts.

[Isn0gud]

It has risen for newer rentals. If I remember correctly, you can increase the rent max 3% per year for an ongoing contract and 10% in a new rental contract.

[adulakis]

City has failed to provide enough housing for incoming people. There is for example an old unused airport (Tempelhof) standing empy at prime location.

[passiveincomelg]

> Mark my words, Berlin will be Europe's Silicon Valley within a few years.

Reminds me of this classic: https://www.youtube.com/watch?v=e22vY4CWpEI

[ornitorrincos]

It does have two international airports:

https://en.wikipedia.org/wiki/Berlin_Tegel_Airport

https://en.wikipedia.org/wiki/Berlin_Sch%C3%B6nefeld_Airport

Although they are planned to be closed when the third one opens(this one doesn't have a lack of issues though):

https://en.wikipedia.org/wiki/Berlin_Brandenburg_Airport

[hknd]

I think people think at something like FRA or LHR when talking about an international airport.

Tegel+Schoenefeld have combined ~30M passengers per year. FRA has ~65M, and LHR has ~80M.

Number of intercontinental flights from Berlin is just super low s.t. most business travelers fly do a stopover in FRA.

[hartator]

> Mark my words, Berlin will be Europe's Silicon Valley within a few years.

If Europe doesn’t pass more startups-killing laws, sure.

[Chris_Jay]

I can't help but think of that Leanord Cohen song, "First we take Manhatten".

[erikb]

This is also Mutti Merkel's proclaimed goal, stated like 10 years ago. She is patient, but she usually achieves what she sets out to do.

[skgoa]

The quickest growing software cluster in Europe is Dresden, though.

[dragandj]

> it lacks an international airport

Berlin has an international airport.

[mhomde]

Sorry, I think I meant transatlantic airport, or a "large" airport. Not sure, it used to lack something I heard but not sure exactly what and if it's still true. They're struggling with building a new one so something :)

[alexcnwy]

Dresden and Budapest much better options nearby :)

[tannhaeuser]

It's "poor but sexy".

[collyw]

Its overrated in my opinion. I never really understood the appeal.

[jk2323]

"Mark my words, Berlin will be Europe's Silicon Valley within a few years."

Doubt it. Lack of professional attitude. Disastrous politicians. 3rd tier universities. Lack of capital. Large underclass, big welfare spending.

It is very hard to set up a "silicon valley". The silicon valley had and has some very unique points, including military origins, if I remember right. Germany still has a strong and broad industry, which is lacking in most Eastern and Western European Economies. This is an advantage (try to do a non-software technology start-up in a country that does not have the suppliers and partners, then you know). In the end it is extremely unlikely that EUrope will achieve something similar than the Silicon valley.

Yes, Berlin once was a scientific, cultural, industrial and technological powerhouse. These times won't come back.

The more interesting question would be, can China manage to create a new silicon valley? I have my doubts.

[HillaryBriss]

> Large underclass, big welfare spending.

I don't know what the comparable figures in Berlin are, but in Silicon Valley, about 11% live in poverty.

"About 11.3 percent of Bay Area residents are living at or below the poverty level, according to the report, “Poverty in the Bay Area,” that was released by the Joint Venture Silicon Valley Institute for Regional Studies. The data reflects levels reached in 2013, the most recent year for which these statistics are available."

https://www.mercurynews.com/2015/04/01/poverty-rates-near-re...

[ahartmetz]

The lack of legacy, good CS universities and capital may matter, I don't see how the other things you mention matter. The big plus is it's a great place to live - it is where things happen.

IMO computer science education is crap everywhere in Germany - it's either mathematics or latest hype topic with no "working technology" in the middle. Professors say informatics alumni will design algorithms, programming is for the plebs, or some such. Where do I even start?

There isn't a single respected programming language from Germany. We have nothing like OCaml, or Python, or INRIA or EPFL or ETH Zürich for that matter.