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The third quarter of 2023 brought both highs and lows for Munich's startup scene. Startups in and around the state capital raised significantly more capital, at around €583 million, than in Q2 (€394 million). The same quarter of the previous year was only slightly higher at €643 million. For all periods considered, no figures were disclosed for some financing rounds, which is why the final amounts are even higher.
Large financing rounds were also completed again in the summer. Helsing received €209 million in its Series B, and Egym received €207 million in its Series F. (We have summarized the most important financing transactions of the past quarter here.The second quarter, however, saw only one financing round exceeding €100 million, as did Q3 2022. The success of Helsing and Egym contributed significantly to the positive development from July to September. Excluding these mega-rounds, the third quarter of this year only raised €167 million – the lowest quarter since Q2 2020, when only €148 million was raised at the beginning of the coronavirus pandemic.
Average investment amount continues to fall
The number of completed financing rounds also continued to decline in the third quarter. Only 36 startups were able to convince investors during the summer. While this is not unusual, as Q3 usually sees less activity than other quarters due to the summer holidays, the summer of 2023 was – in terms of completed financing rounds – the weakest since 2016.
Ultimately, this development also led to a collapse in the average investment amount (excluding mega-rounds). The months of July to September this year averaged only €4.4 million per financing. In the previous three months, however, the figure was €6.4 million. In the same quarter last year, the average was €5.3 million.
US investors again more interested in Munich startups
However, the summer of 2023 also continued positive trends that emerged in the second quarter. In the spring of this year, American investors returned to Munich – albeit hesitantly – after previously withdrawing almost entirely from the state capital. While the share of American money in financing rounds for Munich startups was a meager 4.8 percent (€33.5 million) in Q1, it increased to 28.2 percent (€111 million) in Q2. In Q3, the share grew further, reaching 37.7 percent (€220 million).
Exits, bankruptcies and new funds
The third quarter also saw a number of exits. For example, the AI assistant Askbrian was acquired by Think-Cell, Adivo became part of Zoetis, and Magazino went to Jungheinrich. A total of twelve Munich startups changed hands from July to September. There were no IPOs in this quarter.
Insolvencies hit Xpay, Franka Emika, and The Football Company, among others, in the summer. In addition, the insolvency proceedings of Sono Motors continued to progress. A total of eight Munich startups had to file for insolvency in Q3, one fewer than in the spring. (We have summarized more about the insolvencies of the quarter here.)
The Munich-based startup ecosystem saw only one new investment fund in the third quarter of 2023. Golding Capital Partners announced the first closing of its "Golding Secondaries 2022" fund at €170 million. The fund's target volume is €500 million, roughly twice the size of its predecessor, "Golding Secondaries 2019," which closed at €280 million.
