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Start-up hall of the digital trade fair OMR in Hamburg
Photo: Jonas Walzberg / dpa
German start-ups received significantly less new financing in 2022.
Last year, growth companies raised around 9.9 billion euros in venture capital from investors.
That was 43 percent less than in 2021, as an analysis by the consulting and auditing company EY shows.
According to the analysis, the number of deals closed in 2022 fell by 13 percent to 1008. There were still 37 large financing rounds with a volume of more than 50 million euros - only around half as many as in the previous year.
Despite all the crises, German start-ups experienced 2022, the second best year since the data was collected in 2015, said EY partner Thomas Prüver.
Start-ups depend on investors because they don't initially make any profits.
Large funds and corporations invest money in young companies in the hope that their ideas will prevail.
Due to rising interest rates and the uncertainty surrounding the Ukraine war and the economy, investors' money was no longer so easy in 2022.
According to Prüver, Germany's start-up scene has to prepare for tougher times: "In view of rising capital costs and falling valuations, investors pay more attention to profitability than to long-term growth promises." Start-ups must show a clear path to profitability.
Start-ups experienced a boom during the pandemic and, according to EY, raised a total of 17.4 billion euros in the record year 2021.
They benefited from the fact that money was cheap and that digitization was given a boost during the corona crisis, for example in financial transactions, online shopping or food deliveries.
Now the market has turned: Some start-ups cut jobs, others like the Berlin delivery service Gorillas were taken over.
The start-up metropolis of Berlin also felt the effects of the crisis.
According to EY, start-ups from the capital once again collected by far the most money in 2022 at 4.9 billion euros - but in the previous year it was more than twice as much at 10.5 billion.
Growth companies from Bavaria followed, where the money raised almost halved to 2.4 billion euros.
Of the ten largest financing rounds, six went to Berlin.
Most of the money went to the Berlin insurance company Wefox and the Munich software start-up Celonis.
fdi/dpa