Berlin “Factory” building synergy with small startups

Global Business

It’s called quite simply, Factory and it’s become the new German home of several little-known startups from around the globe. So why are tech firms, Twitter, Mozilla and Soundcloud moving in with them? CCTV America’s Jack Barton traveled to Berlin to explore this innovative tech project.

When it’s complete, the building running along what was once the Berlin Wall will bring together dozens of early stage startups with international technology giants. Some have already moved in. Factory is the brainchild of Simon Schaefer, who shows off some of the World War-II explosives his team cleared in the process of creating this edgy project.

“We figured out if we bring together, in a stage agnostic way, very large companies and very small companies at different stages we were hoping for synergies and we are very lucky that that is actually happening,” Schaefer says.

Cross-pollination is the key and it’s a model that appears to already be working well for women’s Business-Lifestyle-platform Edition F.

“Start-ups come together at different stages so we’re very young, we launched edition F only in May, so only three months ago but then there’s also Soundcloud or Twitter, some very established startups, not even startups anymore and you cooperate, you meet the people and you share your knowledge and your know-how and it’s a strong network,” says Susann Hoffmann, Co-founder, Edition F.

Berlin was chosen because startups, like event search app Vamos, were already flocking here because the city is relatively cheap, connected and considered “cool.”

Luis-Daniel Algeria, Co-founder, Vamos says, “Berlin has the elements and the factory has put it under one roof.”

Experimentalism is taken seriously, but big firms have been quick to get on board.Even Google which has long clashed with the German government over privacy laws has pledged more than $1.3 million to help startups here.Simon Schaefer now wants to export this model across Europe and beyond.

“What we’ve built is a system that works anywhere outside Silicon Valley, anywhere where there’s not so much development yet but a lot of aspiration to try and do something,” he says.

The demand is such that there are currently said to be seven times more startups applying for space at the Factory than there is room to accommodate them.

CCTV America is joined by Rob Enderle, Principal Analyst at the Enderle Group, to talk about what’s next for the startup world.