Status: 04/28/2022 08:14 a.m
The number of newly founded startups in Germany has increased. Founders are focusing on new sectors – and one region in the south in particular is competing with the start-up capital of Berlin.
The number of new startups rose again in 2021. A total of 3348 new startups were founded in Germany last year. The number of start-ups rose by eleven percent compared to 2020. This is the result of an evaluation by the analysis company Startupdetector. For the third time, the company is presenting data on start-up foundations and financing rounds in Germany.
After the first corona lockdown in March 2020 caused the number of start-ups to collapse, the situation has now eased again. “The numbers also seem to be stabilizing at a strong level of just over 800 new startups per quarter,” says the analysis. The industry association is pleased with the current developments. “Startups are the economic power of the future,” says Christoph J. Stresing, Managing Director of the German Startups Association. However, there is still a lot of untapped potential. “This applies, for example, to the area of spin-offs from universities or research institutes. Despite an outstanding research landscape, we often find it too difficult to transfer research results to marketable products and thus stand in our own way.”
In addition to the start-ups, the number of companies that were able to attract external investors such as venture capitalists gives us hope: it rose by 27 percent to 2087. Stresing points out, however, that this still does not come close to the financing amounts in other countries: “Despite the positive Development of the investment figures in recent years, we in Germany are still very well behind not only the USA, but also behind countries like Sweden and the United Kingdom in terms of investments per capita.”
What is a startup?
Startups are understood to be innovative, mostly digital companies that develop new business models in mostly young markets. So not every newly founded company is a startup. Self-employed craftsmen or freelancers such as architects and lawyers are considered to be entrepreneurs – and not start-up entrepreneurs. In addition to an innovative business idea, the criterion for the latter is the primary goal of rapid growth.
Although companies from all industries can be described as startups, in practice they are often active in the technology and internet sectors. Typical sectors are electronic commerce, application software, financial technology, biotechnology, nanotechnology, new manufacturing processes, industry 4.0 or aerospace technology.
Berlin remains the founding capital
As in previous years, most startups in 2021 were founded in Berlin: With 747 companies, around 22 percent of all new startups were created in the federal capital. “Especially in Berlin we see a mature startup ecosystem in many parts,” explains the managing director of the startup association. It consists not only of founders and investors, but also of highly qualified employees, universities and colleges and is now able to “fire itself from its own momentum”.
But other federal states were able to follow suit, because in most of them the number of start-ups increased. According to the analysis, Baden-Württemberg (plus 21 percent), Lower Saxony (plus 30 percent), Saxony (plus 54 percent) and Saxony-Anhalt (plus 166 percent) recorded particularly high growth. With 108 newly founded startups in 2021, Saxony is the frontrunner among the eastern German states, where the start-up rate is comparatively low.
The evaluation of the new start-ups at district level shows something surprising: The district of Starnberg leads the list with a start-up density of 20.5 new start-ups per 100,000 inhabitants, ahead of Berlin. “The companies from the Starnberg district are diverse: from the regional fresh food courier Regioluzzer to Servail, whose robots are supposed to maintain train tracks during operation, to The Exploration Company, whose founder Hélène Huby wants to build a spaceship,” according to the analysts. “According to Wikipedia, the district will have both the highest per capita income and the highest life expectancy in Germany in 2021. This could be due to the high average income in the region.”
Environmental technologies come to the fore
When looking at the sectors in which startups are founded, software, medicine and e-commerce still dominate. “However, the presumably pandemic-driven e-commerce boom of 2020 seems to be slowly subsiding, as this industry is showing a slight decline,” says the report.
On the other hand, the number of start-ups increased, especially in the areas of gaming, media and environmental technology. New methods to combat the climate crisis seem to be the new big trend in startups and investments, because the industry was able to record an increase of 144 percent.
For the first time over 20 percent women
The start-ups are still mainly founded by men. However, the proportion of companies with at least one woman on the management board has been increasing for years and was able to exceed the 20 percent mark for the first time in 2021: “Thus, the proportion of (co-)managed startups is still shockingly low, but there are 84 new female startups still correspond to an absolute increase of 14 percent compared to 2020,” according to the analysts.
The proportion of people with an academic degree who are involved in founding a start-up is particularly high. 14 percent of the teams have doctors or professors in the team, while professors and doctors make up just 1.2 percent of the total population: “The comparison shows that a high academic degree clearly favors founding a start-up.”
It’s particularly fast in Bavaria
If you want to set up a startup particularly quickly, you should pay close attention to the federal state. Because, as the analysis showed, start-ups in Bavaria and Baden-Württemberg were already entered in the commercial register after an average of 28 days. In Hesse and Saarland, on the other hand, this took almost four more weeks. The fastest way is in the Bavarian city of Landshut: Here, the registration takes only eight days.