The total value of all venture capital investments in German start-ups has according to EY In 2021, the volume of capital raised more than tripled from the previous year, from €5.3 billion to almost €17.4 billion. The number of financing rounds rose by 56 percent to 1,160, also reaching a new record. In particular, the number of large deals with a volume of more than €100 million increased significantly from eight to 33 compared to the previous year.
“The pandemic is increasingly proving to be a catalyst for a veritable startup financing boom,”
says Thomas Prüver, Partner at EY.
"Investment activity is increasing across all industries and locations. This means that more and more startups are accessing fresh capital. Furthermore, investment volumes are growing at an explosive rate. This is due to the renewed interest in potentially disruptive business models, especially in the technology sector. In addition, there is strong pressure on investors to invest. There is a lot of money in the market – this is currently benefiting promising young companies."
All top investments go to Berlin and Munich
Startups from Berlin and Bavaria continue to account for the vast majority of investment activity. Startups were able to secure €10.5 billion last year – a good three times as much as in 2020 (€3.1 billion). Startups from Bavaria also increased their investments by a factor of approximately three, from €1.5 billion to €4.4 billion. Startups from Baden-Württemberg followed relatively far behind with €600 million, North Rhine-Westphalia with €566 million, and Hamburg with €459 million. The number of investment rounds also rose sharply last year: in Berlin by 60 percent to 503, in Bavaria by 30 percent to 228, and in NRW by 63 percent to 101.
The largest individual financing rounds are also concentrated in Berlin and Bavaria: The top list of the ten largest investments includes exclusively startups from Berlin and Munich: Gorillas from Berlin takes first place with €861 million, followed by Celonis from Munich with €830 million. The Munich-based companies Ionity and Flixbus are also in the top 10, and the remaining companies all come from the capital.
Compared to the industry, the most money flowed into fintechs and insurtechs, with €3.8 billion. E-commerce followed closely behind with €3.7 billion and software & analytics with €3.6 billion. The investment landscape has changed and expanded significantly in recent years, according to Prüver:
"E-commerce remains a very strong segment into which large sums of money flow, but technology and software startups have also been able to attract extremely large amounts of investment. These companies are often highly innovative and often have the potential to drive the digital transformation of the German economy with their solutions, thus acting as engines of innovation."
