German startups receive record €6.2 billion in investment

New figures from management consultants at Ernst and Young (EY) show that never before has so much money been invested in German startups - with the bulk going to Berlin.

German startups receive record €6.2 billion in investment
A Flixtrain, part of Flixmobility, rolls through Berlin. Photo: DPA

In total, founders and young entrepreneurs across Germany received €6.2 billion in 2019, 36 percent more than in the previous year, according to the report published earlier this week from the London-based firm.

READ ALSO: Germany ranks as best European country for startups

The number of financing rounds largely from private investors rose by 13 percent to 704. The winners are in the capital, where a full 60 percent of startup funding was funneled into.

Startups from the capital received a total of €3.7 billion out of 262 financing rounds – an increase of 41 percent over the previous year.

Startups across Germany

Bavaria is also on the way up as a startup hub. The southern state saw a grand sum of €1.55 billion funneled into it in 2019, an increase of 93 percent from the previous year.

Bavarian Minister President Markus Söder (CSU) is pursuing the ambitious goal of making Bavaria one of the leading digital states in Europe.

Startups in North-Rhine Westphalia also received more this past year (up ten percent to €268 million) as well as startups from southern Baden-Württemberg, where the investment volume almost tripled to €209 million in 2019.

The following graph shows the number of startups which received financing in 2019, broken down by state. Graphic by Ernest and Young.

In contrast, investment inflows from Hamburg (down 54 percent to €254 million) and Hesse (down 44 percent to €73 million) dropped significantly.

READ ALSO: The Hanseatic Silicon Valley? New digital centre to be built in Hamburg

Nonetheless more financing rounds were counted at all six top locations in Germany than in the previous year.

The strongest growth was recorded in North Rhine-Westphalia, where the number of financing deals rose by 45 percent to 87.

Winners are young mobility providers

The mobility provider FlixMobility was primarily responsible for the strong increase, reportedly receiving €500 million in 2019 – the largest sum ever paid to a German startup. 

“Top start-ups again had hardly any problems in obtaining fresh capital last year; the number of German Unicorns has risen further in 2019,” according to the report.

The large investment sum sheds light types of companies investors are now setting their sights on. According to Ernst and Young, the dominance of e-commerce business models was finally broken in 2019, with software and fintech also receiving a strong share of the funds.

Still mobility providers received €1.6 billion – funding that not only went to FlixMobility, but also second place recipient Get Your Guide, a Berlin startup that helps travellers to find tour guides in different cities.

In third place comes the Berlin-based used car platform Frontier Car Group, which saw an investment volume of €361 million last year. 

In the industry ranking, FinTech and software companies rank second and third with €1.3 and €1.2 billion in funding, respectively, received in 2019.

READ ALSO: 'I get mansplained regularly': Do Berlin startups have a sexism problem?


The ambitious goal – (das) ehrgeizige Ziel

The rise – (der) Anstieg

Business models – (die) Geschäftsmodellen

Second and third place – (die) Plätze zwei und drei

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EXPLAINED: Berlin’s latest Covid rules

In response to rapidly rising Covid-19 infection rates, the Berlin Senate has introduced stricter rules, which came into force on Saturday, November 27th. Here's what you need to know.

A sign in front of a waxing studio in Berlin indicates the rule of the 2G system
A sign in front of a waxing studio indicates the rule of the 2G system with access only for fully vaccinated people and those who can show proof of recovery from Covid-19 as restrictions tighten in Berlin. STEFANIE LOOS / AFP

The Senate agreed on the tougher restrictions on Tuesday, November 23rd with the goal of reducing contacts and mobility, according to State Secretary of Health Martin Matz (SPD).

He explained after the meeting that these measures should slow the increase in Covid-19 infection rates, which was important as “the situation had, unfortunately, deteriorated over the past weeks”, according to media reports.

READ ALSO: Tougher Covid measures needed to stop 100,000 more deaths, warns top German virologist

Essentially, the new rules exclude from much of public life anyone who cannot show proof of vaccination or recovery from Covid-19. You’ll find more details of how different sectors are affected below.

If you haven’t been vaccinated or recovered (2G – geimpft (vaccinated) or genesen (recovered)) from Covid-19, then you can only go into shops for essential supplies, i.e. food shopping in supermarkets or to drugstores and pharmacies.

Many – but not all – of the rules for shopping are the same as those passed in the neighbouring state of Brandenburg in order to avoid promoting ‘shopping tourism’ with different restrictions in different states.

2G applies here, too, as well as the requirement to wear a mask with most places now no longer accepting a negative test for entry. Only minors are exempt from this requirement.

Sport, culture, clubs
Indoor sports halls will off-limits to anyone who hasn’t  been vaccinated or can’t show proof of recovery from Covid-19. 2G is also in force for cultural events, such as plays and concerts, where there’s also a requirement to wear a mask. 

In places where mask-wearing isn’t possible, such as dance clubs, then a negative test and social distancing are required (capacity is capped at 50 percent of the maximum).

Restaurants, bars, pubs (indoors)
You have to wear a mask in all of these places when you come in, leave or move around. You can only take your mask off while you’re sat down. 2G rules also apply here.

Hotels and other types of accommodation 
Restrictions are tougher here, too, with 2G now in force. This means that unvaccinated people can no longer get a room, even if they have a negative test.

For close-contact services, such as hairdressers and beauticians, it’s up to the service providers themselves to decide whether they require customers to wear masks or a negative test.

Football matches and other large-scale events
Rules have changed here, too. From December 1st, capacity will be limited to 5,000 people plus 50 percent of the total potential stadium or arena capacity. And only those who’ve been vaccinated or have recovered from Covid-19 will be allowed in. Masks are also compulsory.

For the Olympic Stadium, this means capacity will be capped at 42,000 spectators and 16,000 for the Alte Försterei stadium. 

3G rules – ie vaccinated, recovered or a negative test – still apply on the U-Bahn, S-Bahn, trams and buses in Berlin. It was not possible to tighten restrictions, Matz said, as the regulations were issued at national level.

According to the German Act on the Prevention and Control of Infectious Diseases, people have to wear a surgical mask or an FFP2 mask  on public transport.

Christmas markets
The Senate currently has no plans to cancel the capital’s Christmas markets, some of which have been open since Monday. 

According to Matz, 2G rules apply and wearing a mask is compulsory.

Schools and day-care
Pupils will still have to take Covid tests three times a week and, in classes where there are at least two children who test positive in the rapid antigen tests, then tests should be carried out daily for a week.  

Unlike in Brandenburg, there are currently no plans to move away from face-to-face teaching. The child-friendly ‘lollipop’ Covid tests will be made compulsory in day-care centres and parents will be required to confirm that the tests have been carried out. Day-care staff have to document the results.

What about vaccination centres?
Berlin wants to expand these and set up new ones, according to Matz. A new vaccination centre should open in the Ring centre at the end of the week and 50 soldiers from the German army have been helping at the vaccination centre at the Exhibition Centre each day since last week.

The capacity in the new vaccination centre in the Lindencenter in Lichtenberg is expected to be doubled. There are also additional vaccination appointments so that people can get their jabs more quickly. Currently, all appointments are fully booked well into the new year.