This chapter analyzes the colonial reforms of Bernhard Dernburg that culminated in the founding of the Hamburg Colonial Institute in 1908, to which Karl Rathgen was appointed. It also explores the disappointments with tropical colonies drawn from the surveys spearheaded by Max Sering, the observations of Hermann Schumacher in Southeast Asia in 1911, and Karl Rathgen’s travels in the American south and Caribbean in 1913. Dernburg successfully pushed investments in railways to better connect the German colonies to the German and world economy, and he set strict limits on white settlers. Even so, ambitions for a German temperate zone settler colony never quite died, even as it would prove elusive. The German colonial gaze did shift eastward to the Russian Empire in these years, which Sering and Schumacher visited in 1912 to inspect “inner colonization” in the Ukraine. They returned impressed with what they saw and committed to improving Russo-German relations, but better relations were increasingly hostage to Foreign Office prejudices and the Balkan rivalries of Austria and Russia.