Significant decline in start-up foundations in Germany

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On the other hand, the number of start-ups in online trade, software and financial technology was up to 39 percent lower.

(Photo: Bernd Jonkmanns/laif)

Frankfurt Last year were in Germany 2618 startups were added – 18 percent less than in the previous year, according to a study published on Thursday by the startup association and the industry service Startupdetector.

In the second half of the year, the minus even amounted to 33 percent. That was the sharpest slump in a six-month period since the beginning of the 2019 data series.

“Even the startup ecosystem is not immune to the difficult economic situation,” said Magdalena Oehl, deputy chairwoman of the startup association. “The decline in start-ups can become a problem for Germany’s already sluggish innovative power.”

Therefore, among other things, the influx of skilled workers must be facilitated. The German Digital Association argued similarly Bitkom. Its president recently referred to 137,000 vacancies in the IT sector and warned of a “digital turning point”.

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In 2022, too, start-ups preferred to settle in metropolitan areas and in the vicinity of large universities, according to the study by the start-up association. With 14.5 start-ups per 100,000 inhabitants, Munich pushed Berlin off the throne for the first time.

However, according to a survey by the consulting firm EY, the capital remained the leader in investments by venture capitalists in Germany. Around half of the total of 9.9 billion euros went there in 2022.

According to the startup association, particularly eager company founders are experts in the areas of blockchain technology, which is the basis for Bitcoin & Co, and in climate protection. Here the plus is 65 percent and 14 percent respectively.

On the other hand, the number of start-ups in online trading, software and financial technology (FinTech) was up to 39 percent lower. The authors of the EY study wrote that the inflow of capital there collapsed by 83 and 65 percent respectively.

According to experts, the fight against climate change will also offer start-ups great opportunities in 2023. Regardless of the economic uncertainties, companies could hope for plenty of fresh money from venture capitalists and other investors. According to EY, 1.5 billion euros flowed into this area last year.

More: Financing for German start-ups is collapsing

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