We live in feudal times
I found this pearl of wisdom in the letters section of The Economist the other week and couldn’t agree more:
My liege
SIR – There is a simple answer to the question “why do companies exist at all?” (Economics focus, October 17th). Corporations are organised and run in the same hierarchical, non-democratic manner that feudal societies were. The lord provides protection and defence so the workers can produce without fear of raiders taking their life’s bread. In exchange, the lord gets a percentage of the production. Today’s companies provide that same trade-off, giving their workers job security in exchange for the profit from their productivity. When there is a good balance of productivity and services between the lords and the workers, the system is mutually beneficial.
One could argue that we still live in feudal societies as the dominant organisation in most people’s lives is the company they work for.
Dennis Merritt
Asheville, North Carolina
Of course the problems start when the ‘lord’ is not capable of providing protection and defence anymore, and people realize that their jobs aren’t as safe as they thought.
What is the Gründungszuschuss and how to get it
The Gründungszuschuss is an allowance from the German Arbeitsagentur that is designed to help people receiving unemployment benefits (Arbeistlosgeld I only) to start up their own companies.
It is available since 1st August 2006 and replaces the old ‘Existenzgründungszuschuss’ and ‘Überbrückungsgeld’, which had a similar objective.
The main document you need to read is this one (in German). It is taken from the IHK website, where you can find it entering the number 22907 on the upper right side of the website, in the ‘Dokument-suche’ search box.
You are elegible if you are entitled to a minimum of 90 days of the ‘Arbeitslosgeld I’ unemployment benefit.
There are two phases for this allowance. First, you receive for nine months an extra amount of money in addition to the unemployment benefit. This can be up to 300€ per month. In the second phase you can keep receiving money for another six months.
You will need to apply for the Grundüngszuschuss in the Arbeistagentur with a detailed business plan that will need to include at the very least estimates of the costs and times for the setup of your business as well as for your own living costs for that period. Have a look at the document mentioned above for examples on what the folks in the Arbeitsagentur are expecting from your application.
Of course, bear in mind that I’ve read the document 22907 and this post is just a summary of the main points of what I’ve understood. You’ll need to read it yourself or talk to someone in the IHK or Arbeitsagentur for more details.
Picture by Diganta Talukdar
How to contact the Arbeitsagentur in Berlin?
The Arbeitsagentur or ‘Agency for Work’ is the government body you need to meet for all your working life needs in Germany.
Their website here is massive and intimidating (and it is in German only!).
What I did was 1st: Give a call to the job centre closest to where you live. I called this number: +49 1801 555 111 , which is the one for the Berlin-Nord area.
They will ask your post code and will point to the office closest to you. Mind, there are two kind of offices, for people who have or not higher studies (Uni etc.).
Then, just go to the address they told you with this:
- Passport and/or ID card
- Anmeldung
- Your work life CV for the past 7 (seven!) years. They are interested in your employers and the time spans, mainly.
- Your student life CV. They want to know your education history.
- If you have worked in other countries in the EU, then you can bring in the form E-301, which states that you were working abroad and may entitle you to unemployment benefits based on your social contributions etc of your work in the last country. How to get the E-301 in the UK? click here.
How to get registered in Berlin after moving in? (Anmeldung)
In Germany, getting registered with the local authorities is essential to do everything else. Whether it is opening a bank account, asking for unemployment benefits or registering a company, you will need this shiny paper: The ‘Anmeldung’
To get registered in Berlin, you need to set up an appointment with the ‘Bürgeramt’
Click here, go to the bottom of the page to the ‘Wo können Sie hin?’ section -meaning ‘where can you go?’. Choose the area closest to you and then the office. Click on ‘Termin buchen’, which means ‘Book appointment’ to choose day and time.
They’ll send you a confirmation email, and a few links with the forms you have to fill up and bring in the day of the appointment. The most important are:
- Ergänzungsblatt zur Anmeldung ( http://www.berlin.de/formularserver/formular.php?52014 ). This is the main form, and is mandatory.
- Identitätsnachweis: Your passport or ID card.
- Formular zur Anmeldung bei der Meldebehörde ( http://www.berlin.de/formularserver/formular.php?52009 ). You’ll also need to fill this one, it’s mandatory. They’ll give you the last page signed and stamped to keep as a confirmation that your registration is ok.
In theory, you should get registered within two weeks of arriving in Germany, although this seldom happens. However, you could get fined if you do it later so simply say that you arrived within the last two weeks and everything will be fine.
Also, before you had to present your contract for your flat rent, but that’s not needed anymore.
Good luck!
Three tips to find out the revenue and growth rate of your competitors
Whenever you come up with a great idea for an internet startup, chances are that at least five companies are already doing it. Don’t despair. You will want to see what they are up to, and this three tips may come in handy:
ONE: Use guerrillamail.com to create a fake accounts
These days most websites require you to sign up, and for that you usually need to input your email address. If you start happily giving it away every time you want to just check something, you’ll end up with spam. A lot.
Use instead guerrillamail. I love this free service, you get a temporary working email address that will last for an hour. You can sign up, receive the welcome email, click the activation link etc, and you are set to go!
TWO: Read their blogs, spy their tweets
You can get lots of useful information about the company just by reading the official blog, the blogs of the founders and by checking their twitter stream. When did they start operating, what big deals have they had so far, what kind of customers are they attracting.
THREE: Guesstimate their revenue and growth rate by looking at their URLs
Sometimes the number of customers or users is something carefully hidden from the outside world. But other times, you can infer it simply by looking at their URLS.
In many frameworks, for example Ruby on Rails, you get standard urls that look like this: http://companyblabla.com/users/4565 and where that ID number is simply incremented by 1 each time someone signs up.
If you create your fake account as I told you in tip one, then you might get lucky enough as to see what is your user ‘ID’. Then you can work out the maths and produce a gross guesstimate for example of their revenue and growth rate.
If they charge users monthly for example, you could say something like this:
4565 users x 20% paying customers x 40€ per month x 3 months average time = 109560 € gross.
These numbers are of course estimates, but much more realistic than wildly guessing, and can provide a good benchmark.
What free public help is available for entrepreneurs in Berlin?
There are three main public entities that can help, in the following order and all for free:
This is a new agency set up by the German government on January 2009 as a first point of contact with the German reality. The best thing you can do is give them a call and talk about your plans. It helps a lot if you introduce yourself as an important overseas investor.
They normally send you an email after this first talk with a bunch of useful PDFs giving a decent overview of the German entrepreneurial ecosystem. These are the pdfs that Heiko Stumpf (Heiko.Stumpf at gtai.com) sent me:
Overview, Incentives in Germany, Company Taxation, Company types, Five steps for your company
The next thing you can do is setting up a personal advice meeting in the StarterCenter in the IHK (Einsteigsberatung für Existenzgründer). The best way for doing it is to drop an email or call either Angelika Neuberg (who also speaks some spanish) or Annet Hornung. You’ll probably have to wait a couple of weeks for the appointment as they are quite busy, but this is face to face so you will finally be talking to a real person and that’s is really useful.
Angelika Neuberg
Tel.: 030 31510-600
Fax: 030 31510-114
neg at berlin.ihk.de
They claim to be ‘the first port of call for companies in Berlin’. They come into play once you’ve registered your company and start to operate. I can’t really tell how good they are, since I haven’t worked with them yet. I talked to Cornelia Zürner (cornelia.zuerner at berlin-partner.de), who was nice and helpful, referring me first to the IHK.
The idea is basically that once your business is running, Berlin Partner helps you with contacts, advice etc.
The address of both the IHK and Berlin Partner is: Fasanenstrasse 85, 10623 Berlin
Where to find statistics for market research?
Being it the first time I ever attempt to do some marketing research, I had no idea where to start looking.
A good source of general statistics are the governments official websites. I’ve been looking at the following three, to get an idea of the number of wholesale and retail SME operating in my target market and the evolution of this number in the last 3 years:
Office for National Statistics – ONS (UK)
I could find quite recent statistics and studies here, up to 2009. There are monthly compilations of the latest economic indicators, like number of companies by size and turnover etc.
National Statistics Institute – INE (Spain)
Some of the statistics about number of companies here were older, up to 2007. You can generate your own tables through the website and export them as xls or csv files, which is quite useful to get only the information you want and filter out noise.
Al por mayor = Wholesale
Al por menor = Retail
Statistisches Bundesamt (Germany)
Similar to the spanish website, also allows to generate your own tables with selected data.
Großhandel = Wholesale
Einzelhandel = Retail
Which legal form for limited liability in Germany?
There are several legal forms in Germany under which you can register a new limited liability company:
GbR (also know as UG): Limited liability. From a capital of 1 € . This has been created by the german government to compete with the UK Limited (Ltd.)
GmbH: Limited liability. Minimum capital of 25,000 €. The classic german limited.
Ltd. : It is possible to register a UK Limited company and operate it from Germany. This means that you will have to report to both the UK and German government, but all the taxes etc will have to be paid in Germany. European law guarantees that any type of company from any country can be established and controlled from any other country of the European Union.
There is a growing number of broker companies that can help you establish and control a Ltd. from germany.
