The 12th German Startup Monitor shows: The challenging macroeconomic situation is also causing problems for startups. The bottom line is that although founders are optimistic and the valuation of the startup ecosystem is improving, Germany remains below the existing opportunities.
The financing situation is assessed negatively by over half of the startups (50.7%). The proportion of founders who therefore set profitability as their main goal has risen continuously since 2021 from 58.1% and is now at 73.8%. Many are also relying on the future technology of artificial intelligence (AI) – more than one in five startups (22.0%) see AI as the core of their own product.
“Now more than ever, the motto is: solve real problems and increase productivity. German startups have internalized this and flipped the switch: Profitability, growth, AI, spin-offs and DeepTech – these priorities shape and change the startup ecosystem,” says Verena Pausder, CEO of the startup association.
11.4% of startups can be classified as DeepTech companies that bring new research-based technologies to market. Sebastian Pollok, deputy chairman of the startup association, classifies the results: “Thanks to our world-class research, founders in the German economy are opening up the exciting business areas of the future – examples include nuclear fusion or quantum computing. Universities should provide further support here through standardized framework conditions for spin-offs.”
There is even more potential in collaboration with established companies
In times of inflation and high interest rates, private consumption is particularly sensitive. Startups rely even more heavily on business customers. The share of B2B in the total sales of German startups continues to rise and is now 74.7% (2023: 70.4%). “Software startups in particular offer clear economic added value by optimizing processes and making them more efficient,” says Pausder. “This is particularly true with regard to the shortage of skilled workers. AI-optimized applications increase efficiency and increase productivity, which is so important in our struggling economy.”
But established companies are not only important as customers, but also as partners – for example in research and development or in the area of sales structures. 61.9% of startups were active in corresponding projects in 2024 – although this is a high value, it has declined significantly in recent years (2020: 71.8%).
So there is a problem in the collaboration between startups and established businesses. Only 37.5% of startups rate the cooperation opportunities with established companies positively, which is even less than in the previous year (40.5%). “Compared to other business locations, with our broad medium-sized businesses and our strong industry, we have a huge asset that we still don’t use enough. Collaboration with startups, investments by corporates or takeovers are among the most important ways for companies to be innovative – but unfortunately not all companies in Germany have recognized this yet,” says Pausder.
The entire report is available here for download.
