The vicious circle of why Germany is so far behind in Information Technology — and the gap will just widen.

The internet is official “Neuland” in Germany and most tech companies are essentially just reselling, deploying or developing on top of US technology. A lot of public talk regarding the cause of Germany being far far behind the Silicon Valley is centered around the lack of scale of the German entrepreneurial scene, the lack of venture capital and so on. I think this is only a small aspect of it, the key problem being a different (but nasty) one.

Great tech companies get founded where people / entrepreneurs see and solve problems, where engineers are forced to totally rethink concepts and go new paths.

Just look at recent groundbreaking open source technology in the data processing and operations space: apache hadoop, apache kafka, apache mesos, hhvm, docker… all results of challenges engineers faced while working on the problems caused by the massive scale of applications like facebook, google, yahoo, linkedin and twitter. Well, in Germany there is not even a single company with similar scale and thus no engineers facing thus challenges.

But how do we in Germany expect people to come up with solutions for problems we do not even have and thus do not even work on? And even if someone is struck by lightning and just happens to invent something by chance, who is he going to sell it to?

There is a major difference between being faced with a real-world problem and finding a way to solve it (what the US has to do) and the process of looking for a technology to deploy and customize on top of it (essentially what we do). It’s basically the differences of what Peter Thiel outlined in his book Zero to One or Bryan C. Mezue, Clayton M. Christensen, and Derek van Beve in their paper about The Power of Market creation.

With software now starting to eat the world (aka all other industries), this problem of being 2nd tier in Information Technology will soon start to really affect us broadly. Technical leadership and excellence, the same thing which is the strength and basis of our often referred to successful Mittelstand, is something we simply do not have when it comes to software and information technology. We are just not working on the fundamental concepts and core of things and our applications hardly ever push existing solutions to their limits. And only those pushing the limits will face new challenges and explore even futher.

And this makes it a really hard ride to catch up and compete in global markets…