The economic downturn is not leaving German start-ups unscathed. Many are skeptical about the current situation. The number of bankruptcies is also increasing from an economic perspective.
The economic downturn is also affecting German start-ups. Currently, around one in nine start-ups (eleven percent) fear insolvency in the next twelve months, according to a survey of 172 tech start-ups conducted by the digital association Bitkom.
Almost half report that the situation for young, fast-growing companies in Germany has worsened in the past two years – a year ago this figure was 30 percent.
“Founders are naturally confident, and this is particularly evident when looking at their own company,” said Bitkom President Ralf Wintergerst. Only seven percent see a worse situation for their own start-up, while 30 percent see a better situation.
Politicians are called upon to act
The fact that founders now see the general situation as significantly worse is seen by the Bitkom President as an alarm signal: “The skeptical assessments of the general situation of start-ups should make us sit up and take notice.” The federal government has set itself high goals with regard to start-up support and has already implemented a number of things, such as better employee participation and greater financing through the growth fund.
“Now the economy has deteriorated, the federal government should expand its start-up programs accordingly,” stressed the Bitkom lobbyist. The so-called AI voucher announced by the government should be introduced quickly. “It would provide financial support for the cooperation of medium-sized companies and start-ups in the field of artificial intelligence (AI),” it said.
Number of bankruptcies recently increased
In fact, it is not only start-ups that are currently having a harder time – the number of bankruptcies has also continued to rise from an economic perspective: According to the IWH-Insolvency CenterAccording to the monthly report published by the Halle Leibniz Institute for Economic Research, there were 1,367 bankruptcies of partnerships and corporations in Germany in April of this year. That was five percent more than in March and 47 percent more than in April 2023.
However, this is no cause for concern, stressed Steffen Müller, head of the IWH Department of Structural Change and Productivity: “While the currently exceptionally high number of bankruptcies seems worrying, the early indicators are clearly pointing towards an easing,” said Müller: “The values of the early indicators have been falling continuously for three months. I assume that the number of bankruptcies will start to fall again from May, but at the latest from June.”