Agency Report –
Germany is becoming less attractive as a home for start-ups, a survey found on Monday.
The “Startup Monitor” by the German Startups Association revealed that 57% of founders give the country a positive rating, down four points from a year ago.
Some 78% of founders say they would start another business in Germany, compared to 90% in 2023.
Nevertheless, Germany is gaining in popularity in comparison with the United States: 40% of founders see Europe’s largest economy as more attractive, up 6 points from 2024.
“The US government’s course is playing into our hands,” said Verena Pausder, the association’s chief executive. “Capitalizing on this momentum is crucial not only from an economic, but also from a political perspective in order to reduce technological dependencies.”
Customs duties and political uncertainties in the US are cited as additional risks, “while Germany appears comparatively stable,” the survey said.
Founders praise Germany’s universities, but see other countries as having an advantage in terms of reduced bureaucracy, faster procedures and access to capital.
Germany ranks 18th among the 40 largest economies with regards to access to capital, behind rivals such as France and the US,the association said.
“We must finally mobilize more capital,” emphasized Pausder.
One sector seeing significant growth is the defence industry.
Investments in defence-related start-ups rose from €1.3 million in 2020 to €878.5 million in the first eight months of this year alone, according to the survey.
The Startup Monitor is based on 1,846 online surveys and is produced in cooperation with the ifo Institute.
