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slush Slush Start-up Event | © Hannes Schmidt

Start-up Location Germany

Germany is one of the largest, most vibrant and attractive start-up ecosystems in the world. There are more than 70,000 start-ups in highly specialized sectors across the country.

Innovative start-up business models and technologies are transforming entire industries. Start-ups are a driving force of innovation, economic growth and long-term prosperity.

As both Europe's biggest economy and largest market, Germany plays an important role within the European start-up scene. The country is highly competitive in comparison with other international start-up centers thanks to its unicorns (including Celonis, FlixMobility and N26). Learn more about Germany’s dynamic start-up ecosystem and how Germany Trade & Invest can help you scale your business within this attractive environment.

Germany’s Start-Up Ecosystem

Hundreds of entrepreneurship centers, innovation hubs and acceleration programs across Germany produce around 3,000 new start-ups each year.

Europe’s leading start-up hub

Corporate innovation and venture units work hand-in-hand with publicly funded start-up networks (such as the Digital Hub Initiative) and venture capital firms to create a pulsating web of digital innovators. In 2020, start-ups secured more than 1.6 million jobs in Germany. Germany's start-up ecosystem is truly international – around 45 percent of staff in Berlin start-ups comes from outside of Germany. Female entrepreneurs are growing in number too, establishing 18 percent of start-ups in 2021.

Germany's start-up hotspots

Berlin, Bavaria, Baden-Württemberg and North Rhine-Westphalia account for two thirds of all German start-ups. Berlin, Munich and Hamburg are renowned for their vibrant start-up ecosystems, while Stuttgart offers unlimited cooperation opportunities with global industry companies including Bosch, Daimler-Benz or Porsche. Combining various cities in one ecosystem, the Rhein-Main region (e.g. Frankfurt, Darmstadt) and Rhein-Ruhr region (e.g. Cologne, Dusseldorf) provide plenty of business and growth opportunities for international start-ups. The diversity of regional start-up ecosystems makes Germany unique and represents its decentralized economic landscape.

Germany's major start-up sectors

German start-ups are mostly active in Ithe ICT sector, followed by the medical & health solutions and food & consumer goods markets.

Introducing Germany's Digital Hub Initiative

Twelve digital hubs are located across Germany - each reflecting local industry specialization. They  cover a number of sectors including logistics, mobility, insurtech, fintech, and smart infrastructure.

The goal of the Digital Hub Initiative is to foster innovation and the transfer of knowledge as well as technology cooperation and accelerate the digital transformation of the German economy. The Digital Hubs match start-ups with SMEs, big corporates, investors, and academia.  The Digital Hub Initiative hosts a total of 12 hubs. They are spread across the country and each have a specific industry focus.

What the Digital Hub Initiative has to offer

Combining the innovative approach of entrepreneurs and start-up talents with the resources and skills of established enterprises, the initiative creates digital business opportunities and add cultural and economic value to both established and growing businesses.

Each hub constitutes a unique innovation hotspot. Here, entrepreneurs, start-ups, corporations, and research facilities cooperate to develop concrete programs for the challenges of the digital age. Together, the twelve digital hubs form a strong network that enables the exchange of ideas, programs and expertise.

Start-up Finder: The Start-up Finder provides access to hundreds of start-ups from the Digital Hub Initiative ecosystem.

Program Finder: Looking for accelerators, corporate innovation or co-working spaces? You can find programs offered by the initiative and each hub here.

Expert Finder: The expert finder tool grants access to experts from all sectors with the necessary skills to tackle any digitalization challenge.

Its goal is to strengthen Germany’s position as a world-leading digital economy, whilst enabling international talents to realize their business ideas and inviting global companies to invest in the digital innovation built within this network.

International networking with the Digital Hub Inititative

The Digital Hub Initiative frequently organizes international events with common booths and side events at leading international fairs (Web Summit, Slush, South by Southwest, and Viva Technology). De hub start-ups are welcome to join, exhibit and take part in a joint German presence.

websummit-messestand-digital-hub-initiative Start-up Delegation auf dem Web Summit 2021 | © Hannes Schmidt

 

The Digital Hub’s success stories

The Digital Hub Initiative promotes cooperation and collaboration between start-ups, more established businesses and research partners to forward innovation and digitalization in Germany. In trecent years a multitude of partnerships have arose - many of these are now considered best practice examples and pioneers in their industries. Learn more about recent success stories.

Wandelbots & Volkswagen

Wandelbots is a spin-off from Technische Universität Dresden and connected with VW through the Smart Systems Hub Dresden. In 2018 they started their collaboration with a project dedicated to human-robot cooperation. To date, Wandelbots has raised more than EUR 30 million in funding and is now working with Microsoft and Siemens.  The cooperation with VW marked a breakthrough for Wandelbots in industry partnerships.

R + V Insurance & Nect

R + V is the first insurer in Europe to offer its customers the opportunity to activate the digital customer portal “My R&V” with the video identification process of Nect within a few minutes. Via the portal R + V customers can edit and manage their insurance contracts digitally and receive updates on claims processing. The "selfie" ident-process was developed by Nect in close collaboration with R + V. The cooperation arose from discussions in InsurTech Cologne Hub.

Apic.ai & Eurofins

Apic.ai has developed artificial intelligence to examine causes for insect death. By discovering so far unrecognized relationships in the ecosystem, Apic.ai creates the basis for better decisions in the future. Eurofins is the world market leader for ecotoxicological services. Looking for a precise instrument for recording bee losses because of plant protection products, Eurofins came across Apic.ai. Since then the two have already undertaken several pilot tests with honey and bumble bees.

Vayyar Imaging

After contact was initiated by Germany Trade & Invest, Israeli Start-up Vayyar Home successfully participated in the incubator program at Hub Zollhof Nürnberg. Vayyar Home is a 24/7 fall detection and health monitoring system that provides instant alerts in case of emergencies without the need for cameras, wearables or buttons. For use in hospitals, facilities and care homes, resident health analytics are displayed through a user-friendly dashboard and can easily integrate with existing care systems.

Funding Capital Hub Germany

Access to funding is critical for start-ups. Germany offers numerous funding options ranging from venture capital firms of global importance to state-funded programs.

Increasing VC investment

In the last years, investment volumes in German start-ups have increased significantly to EUR 7.5 billion in 2021. This is a significant level of growth when compared to the previous years of 2019 and 2020 (when investment volume amounted to EUR 6.2 billion and EUR 5.3 billion respectively). In 2021, Germany ranked second place after the United Kingdom in terms of investment volume for start-ups in Europe.

International venture capital

Venture capital firms of global importance take part in large funding rounds in Germany and international investors are increasingly active in Germany.

In 2018, Softbank invested EUR 460 million in Auto1 and supplied funds to GetYourGuide (2019) and Tier Mobility (2020). Abu Dhabi-based Mubadala Capital Ventures is another multinational venture capitalist who took part in a USD 240 million investment round in Flink Food and a UDS 110 million investment round for Wefox Group in 2019.

Further major investment rounds by global venture capital firms were executed by Sequoia Capital in Trade Republic which secured USD 900 million funding, Tiger Global whose round secured USD 110 million for Mambu (thereby elevating it to unicorn status) and Accel with funding rounds for Personio raising USD 75 million and Sennder raising USD 160 million in 2021.

Germany itself is home to an active community of more than 100 corporate venture capital companies. Numerous early-stage investors are active in Europe and can be broken down to VCs with pre-seed focus, seed including pre-seed and seed/series A+ including pre-seed. Some of the well-known investors include Companisto, Smart Infrastructure Ventures, PlugandPlay, and High-Tech Gründerfonds.

Germany increasingly attracts growth and late-stage investors such as Accel, Mubadala Capital Ventures, Sequoia Capital, Softbank Group, Tencent and Tiger Global. These investors have participated in some of the biggest German funding rounds with Celonis, Personio, Wefox Group, Trade Republic, Lilium, and Mambu.

German venture capital networks

BVK

The BVK – Germany‘s Private Equity and Venture Capital Association – represents 300 members, around 200 of which are holding companies including institutional investors. The association also represents the most important German corporate venture capital companies. You can search for investors subject to financial needs, transaction volume and size of revenue. 

BAND Business Angels Network Germany

Business Angels Network Germany e.V. was founded in 1998 and has acted as the official umbrella organization for German business angels and their networks since 2001. You can search for business angels by individual federal state.

Deutsche Börse Venture Network

The venture network fosters network building between investors and entrepreneurs. It offers investors access to investment opportunities in young growth companies with exit potential tailored to their investment profiles. It also introduces companies to suitable investors and supports founders with training and growth know-how.

Public support programs for start-ups in Germany

Germany offers multiple public funding schemes to start-ups with a legal presence in Germany. The federal government offers extensive support information for entrepreneurs. There are programs at national and regional as well as European levels.

National level support programs examples: 

Coparion, High-Tech Gründerfonds (HTGF), SPRIN-D, KfW-Programs, EXIST “Business Start-up from Science”, SME Innovative, Zentrales Innovationsprogramm Mittelstand (ZIM)

Regional level support program examples:

Federal state-owned promotional banks, different venture capital funds

European level support programs examples:

Horizon EUROPE, EIB-Venture Debt

Contact us to receive more information and to find out which program may best fit your project.






From Unicorn to IPO - German Success Stories

Germany has the highest number of unicorns in the European Union - more than 20 companies have a market value of more than a billion euros.

German Unicorns

Germany already hosts numerous unicorns and has many “soonicorns” in the pipeline – the highest number in Europe by some distance after the United Kingdom. Most unicorns in Germany are in the FinTech, mobility and software sectors and typically based in Berlin and Munich. The number of German unicorns has doubled since 2021.

Start-up IPOs in Germany 

As of September 2021, the leading German stock index DAX includes 40 companies instead of the traditional 30 companies listed. The inclusion of start-ups Zalando and HelloFresh speaks to the fact that new and innovative businesses can have successful initial public offerings that pave the way to the top of Germany’s economy.

Delivery Hero

Delivery Hero, founded as a start-up in 2011 in Berlin, is an online food delivery platform. In 2014, investors brought in over EUR 400 million. Successive acquisitions around the world further fueled expansion and after the last investment round in June 2015, the start-up received EUR 2.8 billion. With the IPO on June 30, 2017, the company was valued at EUR 4.4 billion and three months later at EUR 6.5 billion. In 2018, the Dutch competitor Takeaway.com acquired it for EUR 930 million. Since August 24, 2020, Delivery Hero has been listed on the DAX. Its employees exceed 35,000 and sales amounted to over EUR 2.47 billion in 2020.

Zalando

Zalando was founded in 2008 in Berlin and went public in October 2014. Its IPO raised EUR 605 million. In 2015, the company opened additional technology locations in Dublin and Helsinki. They serve more than 42 million active customers in 20 European markets and engage in various business areas: Zalando runs outlets in eleven German cities, with more than 2,400 stationary retailers tied to the company. In 2020, Zalando generated sales of EUR 7.98 billion with over 14,000 employees.

HelloFresh

In 2011, the Berlin based food delivery start-up HelloFresh was founded with the financial participation of Rocket Internet. When it went public in 2017, took in EUR 318 million and was valued at EUR 1.7 billion. In the second quarter of 2019, it generated an adjusted pre-tax profit of EUR 18.3 million. Together with the takeover of competitors in North America (Chef's Plate and Green Chef), rapid expansion was possible and intelligent refrigerators were added to the product list. In 2020, HelloFresh had over 6,000 employees at more than 700 locations worldwide with a turnover of EUR 3.7 billion. Between December 2020 and March 2021, its customer base rose by 37 percent to 7.3 million.

Auto1

Auto1 was founded in 2012 as a start-up for online car trading. Its legal seat is in Munich and its administrative seat in Berlin. With the investment of the Japanese company Softbank in 2018, Auto1 was valued at EUR 2.9 billion. On February 4, 2021, the company went public on the Frankfurt Stock Exchange. The proceeds were around EUR 1.8 billion. Today, market capitalization amounts to EUR 10 billion. More than 4,400 employees work for Auto1 in 30 countries. In 2019, company turnover was EUR 3.5 billion, with a daily volume of over 3,000 vehicles traded.

Mister Spex

Founded as a start-up in 2007, Misterspex is headquartered in Berlin. In 2008, the shop’s website went online in Germany – offering glasses, sunglasses, contact lenses, and matching care products. Misterspex is now present in over 10 countries with over 30 of their own stores throughout Germany. On July 2, 2021, Misterspex went public and raised EUR 375 million. At the issue price, the company has a market value of EUR 829 million. It employs over 600 people and has a yearly turnover of over EUR 130 million.

Start-Up Location Germany News Feed

Start-ups in Germany operate in a vibrant and dynamic business location where new opportunities arise every day. Find out more about what's going on in Germany.

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    Start-up Innovation News | March 2022
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    Food News | June 2022
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Connect at Germany’s Main Start-up Events

Networking of all kinds plays a large role in Germany's start-up ecosystem. This is best seen by the importance of networking spaces, side events and after party events.

Event concepts vary from centralized keynotes and discussions by influential and successful speakers with up to 20,000 attendees to smaller gatherings where the focus lies on interaction between start-ups with a more hands-on approach. Our start-up team frequently visits start-up events and organizes delegation trips to international summits.

  • Bits & Pretzels 
  • Hinterland of Things
  • hub.berlin
  • MO1N Start-Up Camp
  • NOAH Berlin
  • NEXT Conference
  • Ruhr Summit
  • TOA Berlin Conference
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