Photo: Andreas Heddergott / LH Munich

Deeptech boom: Bavaria catches up with Berlin in startup foundings

In the third quarter of this year, 21 percent of German startups were founded in Bavaria—the same number as in Berlin, according to an analysis by Berlin-based investor Morphais VC. Deeptech startups are booming, in particular. However, the overall number of startups has plummeted.

Morphais only added 578 new Startups counted – 18 percent less than in the second quarter and even 30 percent less than in the same quarter of the previous year.

Eva-Valérie Gfrerer, CEO & General Partner of Morphais VC, says:

"Innovative venture capital firms have already recognized that the most successful founding teams of the future will not only come from startup hubs like Berlin or London, but can also be found in technological science centers such as Munich or Zurich."

“Deeptech startups are particularly attractive to VCs”

Deeptech start-ups in particular are on the rise. From January to September of this year, 209 new start-ups of this kind were recorded in Germany – more than the 207 in the whole of 2021. Two years ago, the Berlin VC only 107 new startups from this sector. The share of these startups has increased from 6 to 10 percent this year compared to 2021. Gferer says:

"The fact that the number of new start-ups in the deeptech sector continues to rise is a very positive sign for the industry and for Germany as a center of innovation. Furthermore, deeptech startups are particularly attractive to VCs because the number of startups that exit deeptech companies is 21 percent higher than for average European startups."

To further support the deeptech sector, Gfrerer calls for more capital for such startups:

"To solve our world's global challenges, more capital must flow across Europe into startup teams that develop strong technological solutions and thus real innovations. These solutions ensure that our European technology market becomes internationally competitive and they create new markets."

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