Start up cheaply: The 5 German cities with the lowest startup costs
A Sumup study shows which German cities offer top conditions for founders – affordable rents, fair taxes, and a strong startup scene.
The question of where to found your startup depends not only on the network of potential customers and investors and the best talent, but also on the costs. According to a recent analysis by fintech company Sumup, five major German cities in particular offer particularly favorable conditions – from low rents to attractive tax rates. Two Saxon cities even make it into the top 5.
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Dresden leads the ranking with a score of 76.61 out of 100 points. Its low unemployment rate (6.1 percent) and affordable rents (€95 per square meter in retail) make the Elbe metropolis the most attractive location for startups. In addition to its reputation as a cultural city, Dresden also boasts a vibrant tech scene.
TU Dresden also plays an important role in the startup scene. According to its own information, it produces around 20 spin-offs per year. Among others, the space startup Morpheus Space and the robot startup Wandelbots were spun out of the university. One of the best-funded Dresden startups is Sunfire . In January 2025, the electrolysis startup, which produces green hydrogen, announced a €200 million guarantee loan financing. This came less than a year after Sunfire raised more than €215 million in a Series E round.
Leipzig scores highly in Sumup's rankings with low utility costs and attractive rents. The city has already established itself as a startup hotspot in recent years.
Among the most well-known startups is the digital health startup Mementor , which offers digital medical devices for sleep medicine. Mementor was spun out of the University of Zurich. Several years after its launch, the Mementor founders participated in Spinlab's accelerator program . They subsequently relocated their headquarters to the Saxon city.
Bremen impresses with the lowest utility costs (€257 per month) among the top 5. While the unemployment rate is higher here, the cultural environment and excellent transport links make the Hanseatic city attractive for startups, according to Sumup. Prominent examples include the health-tech startup Carelane , the coworking startup Tapdesk, and the legal-tech startup Rightmart .
Mannheim is considered an innovation center in the southwest and offers the lowest corporate tax rate in the ranking. While founders have to dig a little deeper into their pockets when it comes to rent, they benefit from a strong network between business and universities. The University of Mannheim is considered one of the most successful universities in Germany for startups. Well-known startups from Mannheim include the ESG startup Osapiens , the e-commerce startup Snocks , and the tech startup Cloudrail.
Although Nuremberg ranks fifth, it has the lowest unemployment rate on the list at 5.9 percent. The city benefits from its tourist appeal, which is particularly advantageous for retail. Startup examples include the AI startup Genaios and the robotics startup Roboyo, both of which originated in Nuremberg. The founders of the AI energy startup Avoltra have also chosen Nuremberg, alongside Munich, as their headquarters.
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