Leipzig targets safe and prosperous environment for start-ups

Leipzig’s start-up scene spans sectors as diverse as e-commerce, big data, infrastructure, mobility, life sciences, health and medical technology. Nearly 200 start-ups are estimated to be operating in the city, and entrepreneurs believe it is a good place in which to set up. “There’s a young, energetic community, low costs compared with other cities and a well-connected entrepreneurial infrastructure,” says Andreas Dunsch, co-founder and CEO at FlyNex.

Justus Nagel, head of Business Development, Sensape, agrees: “It’s perfect for start-ups because of the many universities and the cheap and flexible living conditions. Financing is less problematic in Leipzig than in other cities, and it's open for new business as it is growing pretty fast.”

Marilu Valente, co-founder of Binee, describes the city as “a perfect testing ground”. “Everything is much more accessible than in a big city. And because the start-up ecosystem is not excessively big, you get the full attention of your partners,” she adds.

SpinLab chief executive Eric Weber champions the location as well. “We’re unique in that we are close to Berlin – one of the biggest European ecosystems – but we have all the advantages of a smaller city,” he says. “We don’t see any start-ups leaving Leipzig and going to Berlin, but we do see start-ups from Berlin relocating here.”

University boost

Universities in the city and the wider Saxony region are responsible for more than 70 spin-offs, with Leipzig University and HHL Leipzig Graduate School of Management notable for success here.

SpinLab is another key player. It offers a support programme for early-phase start-ups that includes an initial funding bonus, consulting, networking, co-working, as well as access to technology, a recruitment network and an international exchange programme.

“We have a very good investment network,” says Mr Weber. “We know 80% of the German investment scene personally and can connect them to our start-ups. They trust us, so it makes it easier to create links.”

FlyNex, Sensape and Binee have all benefited from SpinLab’s support. “Since we started the SpinLab process, we’ve closed a funding round, generated more leads, found new customers and grown our team to eight people,” says Mr Dunsch.

Sensape was established in 2015 and has since expanded its workforce to 17. Mr Nagel says SpinLab provided a great co-working space where the new business could share its experiences with other start-ups. “Additionally, it helped us gain our first customers and investors,” he adds.

Binee’s Ms Valente says SpinLab “helped us develop a strategy to enter the market, decide which customers to prioritise, build a minimum viable product and test it”. It also gave Binee a space to work, “which is valuable as we are more productive when the whole team is in one place”, adds Ms Valente.

Burgeoning biotech

Science-based start-ups often turn to Bio-Net Leipzig, which supports all stages of business development, helping transfer life science, biotechnology and healthcare research results into industrial applications. “The biotech sector has grown thanks to the Bio City Leipzig Campus and the BioCube facilities,” says André Hofmann, CEO, Bio-Net Leipzig. “Bio City connects business and science under one roof in our 20,000-square-metre space. The great thing is that it is compact and close to the university, making it easy for people to talk to each other.”

The most important service Bio-Net provides is connecting people, linking new businesses to venture capital, he says. “We’ve put Leipzig on the map for biotechnology, and have been successful in hosting the major Bio Deutschland event in 2016. We’re helping to change investor perceptions of start-ups in Leipzig and this is helping our sector to grow,” adds Mr Hofmann.