Tech hubs drive the world’s digital economy and push global innovations. They often appear in the form of large clusters or even mini-cities where all the tech capacities of a country are represented. At this point, Germany is a unique country, as its biggest cities are distinct tech hubs with different specializations within the industry. If you are a tech specialist who is eager to continue a career in Germany – look at our top of the best German cities for IT experts. It will make clear what German locations are leading in terms of tech innovations and what professional prospects they could provide in the tech field.
Population: 1.5 million
Munich is Europe’s Mecca for tech enthusiasts and a key scientific and technological hub – it is going even ahead of London and Paris on various indicators. The city’s position of a frontrunner in Germany’s ICT sector could be explained by 3 factors:
Munich is a home for tech giants, medium-sized companies and promising startups. This wide representation makes the Bavarian capital number one in terms of the innovations development and revenue from the digital economy. Apart from such heavyweights as Microsoft Deutschland, Google Germany, and IBM, Munich is also home to offices of the Alibaba Group, Apple GmbH, Capgemini Technology Services, Cisco Systems, NTT DoCoMo, Telefónica Germany, and Huawei Technologies. Among Munich’s startup success stories is long-distance bus company, Flixbus, which is currently widely known beyond Germany’s market and gaining its share in the US market. Meanwhile, Lilium, which builds air taxis, is frequently mentioned as Munich’s most promising startup to watch. According to Munich’s official website muenchen.de, a total of 1,300 new ICT startups open in the Munich region daily, which constitutes 9 percent of the figure for the whole of Germany.
Munich is a leader also in digitalizing traditional sectors. Numerous tech players along with strong research and scientific capabilities encourage a shift from traditional business schemes to digital paths. Areas with the fastest pace of digitalization are automotive, aerospace, medical and environmental technology industries. Also, Munich is a perfect destination for those seeking jobs in Artificial Intelligence field, app development or automation.
Munich is one of Europe’s leaders when it comes to the number of STEM jobs (STEM stands for Science, Technology, Engineering, Math) with about 360,000 people are working on such positions in the city. Moreover, according to the 2018 Deloitte study, Munich ranks the first among Germany’s cities by the number of employees in the ICT sector (Information and Communication Technologies; constitutes the part of the STEM concept) – for 2018 the figure is over 140,000 people. And the demand for IT Specialists is still growing. Below is the ranking of Germany’s cities by the number of employees in ICT from the recent Deloitte report, which shows that Munich is far ahead from even Berlin in terms of ICT labour force’s size.
Population: 3.8 million
Together with Munich, Berlin constitutes the so-called Big-2. The capital city is also very attractive for tech talents and has a high specialization in the ICT sector but is widely considered as the second most important German tech hub after Munich. Below are the features making Berlin an attractive location for IT people:
Berlin is the domestic winner in terms of attractiveness for venture investors. According to PitchBook’s research, German startups raised about 3.4 billion euros in 2018, while about 40% of this sum was received by companies based in Berlin. In comparison, Munich-based startups accounted for over 18% of the overall funding.
“Silicon Allee” – the leading producer of European unicorns. A new startup is created in Berlin every 20 minutes. The city is home to such successful startups as SoundCloud, Delivery Hero, and Hello Fresh. Along with the highest number of ICT students, this allows making a suggestion that in the near future Berlin could compete with Munich for the title of the leading tech hub in the country. One more proof of it is that Berlin shows the highest dynamics in employment in the ICT sector: between 2013 and 2017, the number of employees in the Berlin ICT sector was growing the fastest at a rate of 13%. The German capital was followed by Munich with a rate of 11%, the report prepared by Deloitte reveals.
The cost of living is lower than in Munich. This factor plays a significant role in attracting tech enthusiasts and innovators – the cost of living, including renting prices of both apartments and offices, is relatively low and accessible for a capital city. Moreover, its openness and cool image are also appealing to a younger, tech-savvy crowd.
Population: 1.84 million
Hamburg is the third city by the number of ICT employees in Germany. Together with Munich and Berlin, it makes the top-3 of the most attractive German cities for tech students and young professionals, as it offers a quiet atmosphere and great international environment.
The leader in gaming development. In recent years, Hamburg became Europe’s leader in free-to-play and browser game development. Currently, the industry of games in Hamburg employs more than 5,000 people, and the market is represented by dozens of players, according to NextMedia Hamburg. The biggest and the most known of them are Bigpoint, Goodgames, and Innogames, which have more than 760 million registered users. The gaming industry in Hamburg is well-supported by the local authorities – the most noticeable initiative in the field is Game City that is aimed at building connections between industry players in the city.
The increasing number of success stories: such companies as myTaxi, Jimdo, Xing or the unicorn AboutYou belonging to Otto Group were initially launched as startups in Hamburg. Moreover, the first office that Airbnb opened outside the United States was in Hamburg in 2011.
The city’s most booming specializations are smart cities and mobility concepts, virtual reality, Blockchain technology, and 3D printing.
Frankfurt, which is historically one of the most important of Europe’s financial centers, successfully embarked on the innovation track becoming the leading location in terms of fintech and cybersecurity innovations.
Focus on fintech. Frankfurt hosts the European Central Bank, Frankfurt Stock Exchange, and 85 other multinational banking headquarters, each seeking to introduce new products and ideas. The demand for innovations in the financial sphere is really high here that encourages German banks and companies to create numerous fintech startup programs in Frankfurt. For example, Germany’s Commerzbank created the Main Incubator that invests in emerging technologies such as blockchain. Deutsche Börse has founded the Deutsche Börse Venture Network, which connects founders with investors. Additionally, the Accelerator Frankfurt accelerates B2B software startups in Fintech, Blockchain, Cybersecurity, Regtech, Proptech, and Insurtech. The half of venture capital receiving by Frankfurt goes directly to the city’s fintech sector.
Pushing cybersecurity technologies forward. Cybersecurity is another of Frankfurt’s specialization, which is developing by leaps. Neighboring Darmstadt provides high-level expertise in this regard, as 450 prominent scientists focusing on cybersecurity are based in this neighboring city. The most prominent Frankfurt’s company in the area is Acellere, a startup focusing on task prioritization and error minimization, which raised $2.5 million in the latest round of investments.
The region around Stuttgart is one of the most important business centers in Germany. Its developed startup culture, easy access to capital and continued success of industry sectors secure high positions for the city in all rankings of the most innovative Europe’s cities.
Country’s center for research and development. Although Stuttgart had long been perceived as a mostly industrial city, its capacity to innovate should not be underestimated. Academics.com portal says that Stuttgart-based companies invest at least 13 million euros in research and development activities daily. By the way, it is more than anywhere else in Germany. In recent years, several innovations campuses and digital hubs emerged in Stuttgart making it possible to connect startups and innovators with potential stakeholders. The city hosts about 20 startup centers, including the Startup Campus Stuttgart and Accelerate Stuttgart.
Among Stuttgart’s core specializations are smart products, mobility and Industry 4.0.
Dusseldorf is one of the best-located Germany’s cities in terms of proximity to numerous markets and business landscape. The only fact that about 31% of the European Union’s total population live within a 300-mile radius of Dusseldorf speaks for itself. It is not surprising that Dusseldorf remains on the same track with cities leading in tech ecosystem development.
The perfect environment for living and doing business. The image of the cosmopolitan, international and growing city is attractive for tech enthusiasts and startupers from all over the world. Currently, expats make up about 17% of Dusseldorf’s population. Foreigners consider Dusseldorf as one of the best locations in Germany in terms of day-to-day living and career. When it comes to the prospects of launching a new business in the city – they are quite bright, as about half of the total EU purchasing power is generated exactly here, while Dusseldorf hosts more than 500,000 companies from different industries, according to the data from European Business Magazine.
A strong network of digital companies and traditional corporations. Dusseldorf is the city where cutting-edge startups meet established traditional corporations and make an efficient symbiosis of this partnership. Strong cooperation between different types of companies converts the city’s tech expertise in a form of the dynamic digital hub with broad prospects for the future.
Germany’s largest cities provide IT specialists and innovation-driven businesses with a sea of opportunities for development. Being the largest centers with complex and modern infrastructure, these 6 giants attract millions of tech people, but there are also a lot of smaller cities with great prospects that in no case shouldn’t be sidelined. We will tell you about other German cities that are worth exploring in the second part of the material, which is coming soon – follow our updates and don’t forget to share your feedback with us!
Sources we used:
- Digital Hubs Germany Ranking Deloitte 2018
- Landing Blog: Tech Hubs in Germany
- PitchBook: Is Berlin Europe’s Next Big Tech Hub?
- Dark Horse of the German Startup Scene By Emma Tracey
- European Business Magazine: Dusseldorf as Germany’s Top Location for Business and Foreign Investments