Bitkom: Lack of capital drives startups abroad

• Every fourth startup is thinking about leaving Germany because of funding
• Every second start-up wants to raise money this year – on average around 4 million euros
• Only 13 percent still want investors from the USA  

Lack of capital could drive many tech start-ups out of Germany. This is the result of a Bitkom analysis of the financing situation of young technology companies. According to the study, almost every second startup is planning to raise capital this year, while at the same time a significant number are considering relocating.

Lack of capital could drive many start-ups out of Germany. Almost every second startup (48%) is planning to raise capital this year and wants to collect an average of 4 million euros. At the same time, one in four startups (25 percent) is considering leaving Germany due to a lack of capital, while only 17 percent feel that the supply of venture capital in Germany is sufficient. This is the result of a survey of 133 tech start-ups in Germany conducted by Bitkom Research on behalf of the digital association Bitkom. “With every startup that leaves Germany, we lose jobs and added value, but above all innovative ideas and solutions,” says Bitkom President Dr. Ralf Wintergerst. “Further strengthening the WIN initiative, which aims to provide growth and innovation capital for Germany, would help. Incentives for institutional investors to invest in venture capital would also be important.

A reform of private pension provision could also allow policyholders to participate in the success of start-ups, while at the same time strengthening the capital market.”

Around two thirds (64%) of start-ups that want to raise capital this year are convinced that they will succeed in obtaining financing. 13% are skeptical, while a further 23% do not know or do not want to say.

When it comes to the question of where the money should come from, German start-ups have a clear preference. Three quarters (74%) of founders would prefer to meet their capital requirements with investors from Germany, while 22% would generally consider German investors and 5% would not. Around half (52%) prefer investors from other EU countries, for 46% they are an option and only 1% reject them in principle. The USA follows at a considerable distance: only 13% prefer US investors, for 59% they are at least a possibility, but 23% do not consider them. Bringing up the rear is China. Only 1 percent prefer Chinese investors, one fifth (21 percent) consider them and two thirds (66 percent) rule them out. Investors from other non-EU countries are preferred by 7 percent, they are considered by two thirds (66 percent) and excluded by 17 percent.

For many start-ups, a future IPO is also an option, with domestic and foreign stock exchanges almost on a par: 43% can imagine an IPO in Germany, 40% an IPO on a foreign stock exchange.

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Further links

👉 Read the original announcement

👉 www.bitkom.org