Germany’s startup friction debate: notary formalities, PoA and the cost of complexity
What’s the debate? On 29 August 2026, Patrick CollisonDealroom has a profile for this one. Try Dealroom → described meeting a German founder who said that the country’s startup challenges are “understated”. The founder reportedly spent a full day having a 90-page investment contract read aloud by a notary. Patrick later clarified that this kind of friction, alongside issues such as employment law, can determine whether a founder stays in Germany rather than whether a company succeeds or fails.
The important qualification: the viral retelling often turns this into “Germany charges €30,000 to incorporate a company”. That is not established by the original post. A standard GmbH formation is a different matter from a complex venture-financing or share-transfer transaction: the €25,000 GmbH share capital is an asset of the company, not a notary fee, while ordinary formation costs are generally far below €30,000. German notarial fees are statutory and value-based, so a large and complicated transaction can produce a substantial bill, but the discussion provides no invoice or transaction documents that would allow the €30,000 figure to be verified.
What the law and practice mean: German notarial procedure requires the deed to be read aloud to the parties, approved and signed. Venture financings may involve notarised share transfers or other formal instruments in addition to the commercial investment agreement. However, personal attendance is not always necessary. Philipp MoehringDealroom has a profile for this one. Try Dealroom → points out that a power of attorney can allow counsel, a junior lawyer or the founder to attend instead. That workaround avoids making every investor sit through the reading, but it does not remove the underlying legal formality, preparation or transaction cost.
The US comparison: Paul GrahamDealroom has a profile for this one. Try Dealroom → contrasts this with the YC model, where investors can rely on standard documents and focus mainly on names and numbers because the text is familiar and consistent. The strongest contrast is therefore not simply “notaries versus no notaries”, but bespoke, high-friction execution versus standardised venture infrastructure.
Why it matters: Christian MieleDealroom has a profile for this one. Try Dealroom → draws the broader policy lesson: governments should focus on making their countries attractive to founders and employees of innovative, fast-growing startups, because that is where growth and prosperity come from. The fair conclusion is not that Germany uniformly costs €30,000 to set up a company. It is that even when a practical workaround exists, complex formalities can create enough uncertainty, time cost and perceived friction to influence where founders and investors choose to build.
Read more: Patrick Collison on X · Paul Graham on X · Philipp Moehring on X · Christian Miele on X · §13 BeurkG · §15 GmbHG · GNotKG
