Paris, London, Berlin… major European metropolises where entrepreneurship often comes with high costs, heavy taxation, and saturated markets. Could Madrid be the best alternative?
With more affordable commercial spaces, a favorable tax system, a booming economic ecosystem, and an enviable quality of life, the Spanish capital is attracting a growing number of German entrepreneurs seeking opportunity and flexibility.
Lower Costs and a Simplified Setup
Setting up a business in Madrid means benefiting from significantly lower commercial rental costs compared to other major European capitals. A downtown office in Madrid costs up to 50% less than in Paris and 60% less than in London, a crucial advantage for growing businesses.
The cost of labor is also more competitive, while still providing access to a highly qualified, multilingual workforce from numerous renowned universities and business schools.
From an administrative standpoint, Madrid offers a faster and more efficient setup process compared to many other European capitals. For example, starting a business in Madrid can be completed in just 7 to 12 days.
Madrid also provides dedicated support structures for foreign investors, including Invest in Madrid, the city’s investment promotion agency, which offers tailored assistance to meet the needs of international businesses.
Lower Taxation, Greater Competitiveness
Unlike many other European capitals, where taxation significantly burdens entrepreneurs, Madrid stands out with a lighter tax regime. There is no regional wealth tax, a competitive corporate tax rate, and an advantageous fiscal policy for international talent under the Beckham Law, making Madrid an ideal destination for new business ventures.
Madrid’s attractiveness is not just theoretical; it is a major magnet for international investment. In 2022, the city attracted 63% of all foreign direct investment in Spain, solidifying its role as an economic powerhouse in key industries such as manufacturing, logistics, biotechnology, cultural and creative industries, and urban mobility.
The Madrid region is also a prime destination for company headquarters, offering easy access to both European and Latin American markets, thanks to its strategic geographic position.
A High-Quality Lifestyle to Attract and Retain Talent
Entrepreneurs don’t choose Madrid solely for economic reasons. The city offers a work-life balance that is hard to find elsewhere. The cost of living is significantly lower than in Paris, London, or Berlin, making housing, transportation, and daily services more accessible.
Madrid also thrives as a cultural and gastronomic hub, attracting a diverse international workforce. The highly efficient public transportation network and the ultra-modern, well-connected Adolfo Suárez Madrid-Barajas Airport, one of the most advanced in Europe, facilitate business travel across the continent, making it an essential asset for expanding companies.
Madrid: A Strategic Choice for German Entrepreneurs
More affordable, more agile, and more internationally oriented, Madrid has positioned itself as one of the most attractive European capitals for German entrepreneurs. By combining economic competitiveness with an outstanding quality of life, the Spanish capital ticks all the boxes for those looking to accelerate their growth in Europe.