Germany may be the Eurozone's biggest economy, but its capital Berlin has long been one of its poorest cities. Not anymore. A recent boom in tech startups has contributed to strong economic growth in recent years, allowing Berlin's budget to enter the black for the first time since its dividing wall came down.
"Poor but sexy" is how Berlin's mayor once described his city.
But last month the German capital balanced its books for the first time since re-unification.
Thanks largely to an enormous influx of technology startups like photo-sharing app creators EyeEm whose founders hail from Austria and Lebanon.
"Berlin was like a meeting point and of course the conditions to start a company were just perfect in Berlin," Severin Matusek, Eyeem Content & Community head says.
Avuba chose Berlin to pilot what it describes as mobile app friendly banking that includes a smart credit card that tells you where you're spending your money.
"London is quite expensive so Berlin is quite right because you have low living costs, low rent for businesses at the same time you have great creative people and with Germany you have a large enough market to pull off significant traction that you can then expand to Europe," Jonas Piela, CEO of Avuba, says.
Startups are helping to draw about 30,000 new residents to Berlin every year.
Avuba is being helped along by startup bootcamp Berlin, which offers 15,000 euros in seed money, free rent for six months and lots of mentoring.
"I remember when startupbootcamp first moved to Berlin it was the first accelerator, now we have ten in berlin and it's just such a magnet for talent from all over the world. We have applicants from America, from India, from Australia, China from Africa," Sophie Hechinger, Chief Managing Officer of Startup Bootcamp Berlin, says.
Since 2010 hundreds of tech start-up have made Berlin home.
"There are lots of comparisons are we the next Silicon Valley, whatever, what we do not know is the trajectory is absolutely amazing," Ciaran O'leary, partner of Earybird Venture Capital, says.
As a consequence government tax revenues are expected to hand the city a healthy surplus next year.
The downside of all this success is that rents and property prices in Berlin are soaring and the cost of living in general is becoming more expensive.
But it's a factor startups and venture capital markets are shrugging off.
"Even if Berlin doubles, triples, quadruples in prices it will still be below London and New York and those places are also booming," O'leary says.
So Berlin is the now the undisputed tech startup capital of Europe and while the city is still sexy, it's definitely no longer poor.
Source: CCTV
