How to start an IT company
Germany, and in particular Berlin, is the largest tech community in Europe. IT solutions are in high demand in Germany and the EU. From this article you will learn which of IT businesses are the most requested in Germany. Find out if it is possible to provide such services without a legal representation in the EU. And how to start an IT company in Germany.
Our company, Nexus-Europe GmbH, assists foreigners with starting and developing their own business in Germany and moving to Germany through business immigration. IT is a priority area of focus in Germany and especially Berlin. If certain requirements are fulfilled, obtaining a residence permit through business immigration in case of IT activities is much easier than for a number of other businesses.
Start an IT company in Germany: firstname.lastname@example.org
In-demand IT directions
Let’s see what IT services and products are the most requested in Germany.
Software development. From developing apps for smart phones to programs for different operating systems. Several options are possible: for example, you can develop and implement your own app to profit from it or develop apps for various clients.
Video game development. Development of computer and mobile games has significant support in Berlin and Brandenburg. In some cases government grants are a possibility.
Platform development. For example, development of e-commerce, knowledge, service or other platforms that are used by numerous users. A lot of businesses have demand for such platforms to realize their products or services.
Fintech. Germany, and especially Berlin, is currently highly focused on fintech.It’s a general term that includessoftware, applications and other technologies intended to automate and improve traditional forms of finance.
Website development. According to the client’s request you provide services of building a website that can include coding, scripting, markup, network configuration etc.
SEO (Search engine optimization). It is the process of optimizing a website’s contents and technical configuration aimed at ranking higher in search engines. SEO services are highly sought after since they improve the chances of the target audience finding the websites and the offered goods or services.
SMM (Social media marketing). This is a form of internet marketing that targets social media platforms such as Facebook, Twitter, YouTube, TikTok and others. It is a highly-demanded service in the age of social media that keep gaining in importance.
IT employment agency. You can assist clients in finding suitable candidates by providing employment services. In this case the agency usually gets a provision in the amount of 3 monthly salaries of the found employee. Another option is to lease own employees for work to third parties. This kind of services require a special permit. We have a detailed article about opening an employment business in Germany, please check it out.
Setting up and supporting IT infrastructures. Installing and maintaininghardware such us computers, printers, routers; installing and updating programs, setting up and supporting networks. It includes all that has to do with launching and supporting the IT infrastructures of companies.
Technology training. This service is in high demand. Many Germans still can’t effectively use the constantly changing programs and applications for daily operations, such as CRM systems and others. Thus they can’t fully benefit from digitalization. Providing such services as technology training of personnel to clients is a very beneficial direction.
Cyber security solutions. Such solutions are highly relevant since small and medium-sized businesses are constantly experiencing cyber attacks. This means not only installing programs, equipment, firewalls and administering but also personnel training. Many Germans still open attachments to emails that contain viruses and Trojans.
Data storage services. For example cloud storage services.
Providing servers and web hosting services. Anyone who wants to have a website needs these services to store the information and make it accessible to visitors.
Hardware development. This covers designing and manufacturing electronic equipment and systems.
Business automation. These are services designed to simplify repetitive tasks by using technology tools and applications. This frees the employees’ time for more complex tasks that require their attendance.
Artificial intelligence (AI). Many companies integrate artificial intelligence into their work. It refers to computer systems or machines that perform tasks by mimicking human intelligence. Such systems are also capable of analyzing the collected data and using it to improve and evolve.
Robotics. Robotics is a branch of engineering that is responsible for designing and operating robots. Robots are basically machines that are capable of carrying out various programmed activities and by that automate the working process.
It seems like many IT projects can be realized remotely, without having a legal entity in the EU. But is that really so? Let’s find out.
General Data Protection Regulation (GDPR)
Since 2018 EU countries adopted the General Data Protection Regulation (GDPR). It aims for ensuring data protection for all EU citizens and those living in EU countries. For non-compliance a fine of up to 4% of global annual turnover or 20 million euro (whichever is greater) can be levied. The requirements are very strict and complicated. Even German companies find it difficult to make sense of them without specialists in GDPR.
If you provide IT services as outsource through a non-EU company, in 99% cases the EU customer will avoid hiring you to avoid the risk of non-compliance with GDPR and high penalties.
All IT products or services intended for private consumers in Germany have to be GDPR-compliant. It’s not only a matter of avoiding huge fines. Germans are very serious about the privacy and data protection. They study the imprint on the website, the company’s registration details. If you don’t have a legal entity in Germany, they would refuse buying your product. With the implementation of the GDPR many non-EU service providers withdrew from Europe to avoid the risk of heavy fines.
Germany has a lot of regulations that make outsourcing IT services to companies registered outside of the EU very risky and complicated.
What’s the solution?
Registering your own IT business in Germany. Then you can sign contracts and provide services on behalf of your German company, and Germany is considered one of the safest countries in regard to cyber security and data protection.
How to start an IT company
Here are the main steps on how to start an IT company in Germany:
- Think through what products and services you are going to provide, whom they are intended for.
- Check out the necessary compliance with the requirements. You’ll probably need a legal adviser for that. When you open a company through us, we can assis you with developing a concept and provide you a consultation with a lawyer specializing in GDPR compliance.
- Register a company in Germany as a subsidiary or with a private shareholder. When you approach us with the question how to start an IT company, we analyze your situation and suggest the optimal legal form in your case.
- In most of the cases you can run the company with a business visa. However if you’d like to stay in Germany for over 90 days within 6 months, you’ll need a residence permit. IT is a priority area of focus in Germany and especially Berlin. If certain requirements are met, obtaining a residence permit through business immigration in case of IT activities is much easier than for a number of other businesses. To make the process maximally safe and effective, we have developed our very own 5-step Nexus Smart Immigrate Technology.
- Implement the GDPR and other compliance requirements.
Now you know how to start an IT company and are free to work in Germany and the entire EU.
Our company, Nexus-Europe GmbH provides turn-key solutions for opening an IT business for you: we help to check the legal requirements, establish a company in Germany for you, get licenses and permits, find local staff. We can also assist you with obtaining the German residence permit because of business. If the activity is especially beneficial for the region, government support might also be available. Since all projects are guided by certified Project management professionals (PMP) you get a working business in Germany and ensured quality of performance. On time and on budget.
We also have other turn-key solutions such as starting an e-commerce, trading company, transport company or a restaurant in Germany and many others. On our website you’ll also find a lot of other useful information on opening a business in Germany and business immigration.
Contact us to open a business in Germany and move to Germany: