The total value of German startups reached $168 billion in 2022, accounting for 4.7% of the GDP. While this figure still lags significantly behind the United States (16%) and the United Kingdom (13.5%), as well as the neighboring EU country France (6.9%), it marks a more than fivefold increase in the startup value since 2018. This information is derived from the first progress report of the German government on its new startup strategy introduced in July 2022, which was published on Tuesday.

According to the report, nearly 1,300 new startups were established in the first half of 2023, reflecting a 16% increase compared to the previous six months. This suggests that startup formations in Germany have regained momentum. In 2022, Germany saw the founding of 2,619 startups, representing an 18% decrease compared to the previous year. Anna Christmann, the representative of the Federal Ministry of Economic Affairs for the digital economy and startups, expressed satisfaction with this development, describing it as "a very positive trend in a challenging environment." Currently, there are 31 so-called "unicorns" in Germany, referring to young companies with a valuation of at least $1 billion.

The progress report acknowledges the unique challenges that startups currently face, particularly in dealing with the changing interest rate environment and inflation. As maintained by surveys, more than half of these companies find it difficult to assess their future business prospects.

Christmann emphasized the rapid implementation of the government's startup strategy, reporting that 45% of the approximately 130 announced measures have already been fully executed within a year. Additionally, around 50% of the projects have made concrete and substantial progress in preparation. Christmann highlighted important new regulations that are expected to further improve the conditions for startups in Germany, including the new Skilled Workers Immigration Act, which comes into effect in November, and the Future Financing Act, which introduces new tax regulations for employee capital participation. However, the latter law still needs to be approved by the German parliament.

In the area of startup financing, the new DeepTech & Climate Fund began its investments in February, while the HighTech Gründerfonds (HTGF) has already raised in its fourth generation around €500 million in investor funds for startups. In February, the European Tech Champions Initiative (ETCI) was also launched. Meanwhile, the Growth Fund Germany has already invested in more than ten German and European venture capital funds.

Regarding the budget constraints, Christmann pointed out in front of the press in Berlin that the limited financial situation has not led to the removal of projects from the startup strategy.

The percentage of women involved in startup founding increased to over 20% in 2022. According to the progress report, gender parity could be achieved by 2030 if the growth trend continues. However, Christmann highlights that the current percentage of women's participation is still unsatisfactory. There is also room for improvement in university spin-offs and data availability. Nonetheless, efforts to establish a data institute have already begun, states Christmann.

Online notary procedures have been available for about a year, but the planned "One-Stop Shop," which aims to simplify and integrate all services relevant to starting a business, is still in progress. Christmann acknowledges that here they have not yet reached their desired level of progress.

The progress report also highlights the increasing importance of ecological sustainability in the startup scene. The proportion of green startups reached 35% in the past year, setting a new record. The most significant areas for green startups are technology development and production.