Comment by yokaze

Also had a (failed) startup in Germany, with a slightly different perspective. Possibly outdated.

> It still baffles me, that you need to buy your own shares in Germany, in order to receive the “status” and protection of being a fully incorporated company.

It depends on how you read it, but it isn't true that you have to put in 25.000 in cash on the table. A GmbH is a Limited, which needs to have a value of at least 25.000EUR, so anyone trading with you knows, you are at least good for that amount.

The easiest way is to put the money in cash into the account of the company.

But it can also be done via transferring the ownership of either tangible or intangible assets into the company. The problem here is, especially with software, that the evaluation of assets is not for free and difficult.

> Now, you don’t need to convert the UG to a GmbH but if you want to be taken seriously in Germany by customers and investors, it can be a huge factor doing business. For our investor, it was a must-have.

The feedback I got from institutional investors was the following:

- If you are not willing to put down 25k, while asking for millions, it doesn't send much of signal of confidence in your proposal from your side.

Maybe it is a matter of German risk averseness, but I think it is reasonable, especially paired with the next advice:

- You will take a top level management position in your new company, your salary should reflect that. You have to strike a balance of not asking too much (you are after all a startup), but also not asking enough (you need to know the market value of your position). But chances are, the increase in your salary by your "promotion" should pay your initial investment in two years time.

In Germany, composition is much more salary based.

> I don’t know what to tell you, other than this process can take up to 3–4 weeks to get finished. Even most challenger banks (neo banks) are not really faster.

> How do I know? We’ve incorporated another holding company UG and wanted to use a Berlin based challenger bank — it took us almost a month to get done.

> Choose your bank provider wisely or at least switch early. We went with a 0$/month neo bank and it was horrible.

Yeah, we went with a traditional physical bank. Costs a fair bit more than 0€/month, but it took a couple of days, maybe?

> A mail popped up along the lines of: “We would like to do a 10 minute interview in Mountain View with you. We compensate your travel expenses”

And I think, that is the most striking difference in culture between the US (or at least SV) and Germany. Those guys where trying to safe a couple (granted couple of thousands) Euros, and a couple of Euros per month for the bank, and the investor is paying the travel costs probably coming close to the founding costs for a 10 minute interview.