Startup industry
Start-ups get more money – Bavaria overtakes Berlin
Increased interest rates and risk-averse investors have plunged many German start-ups into a financing crisis. Now things are looking up again. Founders shine outside of Berlin.
Start-ups in Germany are again receiving more money from investors – especially in Bavaria, which is overtaking the start-up metropolis of Berlin. This is the result of an analysis by the auditing and consulting firm EY, which is available to the German Press Agency.
Start-ups from Bavaria raised around 2.33 billion euros in venture capital in 2024, a good 600 million euros more than in the previous year. Young companies from Berlin received 2.17 billion euros (minus 200 million euros). This means that the Free State is overtaking the capital for the first time, according to the study, which has been published since 2014 and is based on figures from the “Crunchbase” database as well as messages from start-ups and investors.
Overall, German start-ups collected a good seven billion euros in venture capital in 2024, 17 percent more than in the previous year (a good 6 billion euros). This means that the start-up industry is recovering from its financing crisis that broke out after the sharp rise in interest rates. According to EY, in 2022 German start-ups had raised around 9.8 billion euros in venture capital, which funds and corporations can use to invest in start-ups. In the record year 2021 it was even 17.3 billion.
According to the study, start-ups from Bavaria received five of the ten largest financing nationwide in 2024. The Munich-based software company Helsing, which specializes in artificial intelligence (AI) for the defense industry, was in the lead with a financial injection of 450 million euros. Berlin didn’t even appear in the top 10 financings.
“The fact that Bavaria has overtaken Berlin in terms of financing amount for the first time is due to the tech and AI boom – Bavaria is ahead here,” said EY partner Thomas Prüver. At the same time, there is a significant decline in money for online retailers, the capital’s traditional strength. However, Berlin remains one of the most important start-up cities in Europe and ahead of Bavaria in terms of the number of financings.
dpa
Source: Stern
