Why Germany is a VC hiring hotspot
"I was surprised to read that Germany has such a big picture of open VC positions," one of my Berlin-based VC sources recently texted me. They pointed out some data doing the rounds on LinkedIn a couple weeks back (including in our own Up Round newsletter), showing Berlin had the highest number of open VC roles among the top European cities last year; Munich came in third.
The data was gathered by Konrad Kordowski, head of investor relations at Slush, and showed there were 428 VC roles advertised in Germany last year, with 215 in Berlin and 112 in Munich. There were also dozens of jobs across Frankfurt, Cologne, Hamburg and Bonn.
Kordowski’s been tracking VC hiring data — with a focus on investing roles — since 2022, and says that as "the capital goes to the biggest cities" and "Berlin and Munich are the biggest cities in terms of the number of startups, that's why these are the epicentres of VC activity when it comes to hiring." He does note, however, that the number of advertised roles has been decreasing each quarter.
Others, like Sienna Rothery, senior associate at executive search firm Erevena, note that anecdotally there have been a lot of new funds popping up in Berlin, particularly in climate, that need to hire.
But what sets Germany apart from other venture powerhouses like the UK (which holds the top spot for overall VC funding in Europe) is that there’s not just one dominant VC hub. There are numerous different cities in Germany "where VCs actively hire", says Kordowski, including Hamburg, Cologne, Bonn and Frankfurt, "whereas in France, it's only Paris; in the UK, it's only London," he notes. Germany "has a more diverse VC space."
While Berlin may have been the undisputed VC capital years ago, Munich has been a rising hotspot for startup and VC activity, as my colleagues and I recently dug into. In fact, according to Kordowski’s calculations, Berlin’s share of open VC jobs declined slightly from 2022 to 2023 (more than 27% of all jobs in 2022 versus 20% in 2023), while Munich’s is on the rise (8.7% in 2022 to 10.5% in 2023). Munich’s engineering universities, like the Technical University of Munich (TUM), as well as its deeptech prowess, have contributed to its popularity.
"Munich is back," Edmund Jones, a VC-focused partner at executive search firm True Search, tells me, adding that due to his company’s deeptech focus, he’s spending more time in Munich than Berlin these days. He adds that older investors are more keen to live in Munich compared to Berlin’s younger crowd.
And broadly, the German government is also angling to get more money into the country’s VCs with its €1bn fund of funds, which should bolster the ecosystem.
Still, the industry is clearly going through a rough patch, and the market is tough for first-timers. Luke Pappas, London-based partner at US VC firm NEA, recently told me that while he hasn’t seen VCs’ hiring plans change too much (including NEA’s), "it's not as active of a market. If you're trying to break into venture, there are less roles today." He says "the reality is that deal pace is lower right now," and that he actually tells people looking to break into venture that "if this is your first job, I wouldn't recommend going into investing or a finance role right now; I would go work at a company, and specifically I'd go work at like an AI company, because that's where you're gonna get the most quality deal reps."
We’ll have to see what 2024 brings. Based on January’s open VC roles, Kordowski says it’s off to a slow start; True Search’s Jones, meanwhile, says that big VCs with cash are hiring more, but it’s less across the board.
But I’m curious to hear from you VCs: What are your hiring (or layoff) plans this year? Do you expect to promote more internal people or hire out roles? What about salaries? My line is open.
— Anne Sraders, senior reporter
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