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Venture Capitals
[I contributed two items to this global survey of start-up-friendly
regions.]
Originally published in Wired
8.07, July 2000
Bavaria, Germany
Score: 11
Before 1997, the idea of investing in a hot young company
ran contrary to German notions of stability and pedigree.
This, coupled with tight restrictions on entering the Frankfurt
stock exchange, made an IPO nearly impossible for small companies.
But with the creation of the Neuer Markt - an exchange with
more relaxed entrance rules - everything's changed. EM.TV,
a Bavarian media company, was among the first to go public
on the Neuer Markt and now sits at a market cap of around
$10 billion. Its success has made the climate more favorable
for unproven companies and attracted seed money from VCs like
Bayern Kapital and banks like LfA Förderbank Bayern.
Meanwhile, state-sponsored initiatives are spawning university
research in artificial intelligence, systems technologies,
and microelectronics, and stock options are beginning to lure
executives away from established companies like Staedtler,
Siemens, and BMW.
Universities and research:3
Established companies:3
Startups:2
Venture capital:3
Baden-Württemberg, Germany
Score: 10
Export giants like DaimlerChrysler call this southwestern
state home, but after being hit hard in the early 1990s by
a downturn in the global automotive market, Baden-Württemberg's
been racing to diversify. Local officials now play up the
region's Mittelstand, or small companies, and both private
and public sectors are trying to encourage the state's 9 universities,
39 polytechnics, 38 research institutes, and 3 research centers
to rev up the economy with new technologies.
The fact that IT enterprises can cherry-pick skilled labor
from the region's old-guardGerman and multinational companies
- including Porsche, SAP, Sony, HP, and IBM - is an added
incentive. The state is no stranger to innovation (9,700 patent
applications were filed here in 1998, the most in Germany),
but factors like high tax rates and an inflexible labor system
(wages are negotiated industrywide) continue to hobble new
ventures.
Universities and research:3
Established companies:3
Startups:2
Venture capital:2 |
