Lack of capital: German tech start-ups flirt with foreign countries

A lack of venture capital in Germany is driving young companies abroad. This is the result of a Bitkom survey presented by the digital association on Tuesday. According to the survey, one in four of 152 German tech start-ups surveyed are currently considering moving abroad due to a lack of capital.

“The difficult financing situation compared to other countries has been causing problems for many German start-ups for years,” said Bitkom President Ralf Wintergerst, commenting on the survey results. The Future Fund, which aims to provide ten billion euros for young tech companies by 2030, is a step in the right direction but is not enough on its own.

“Our goal must not only be to keep tech start-ups in Germany, but also to make Germany really attractive for founders from other European countries or the USA.” In fact, it is currently the other way around: among start-ups that are considering moving abroad, the USA is the most important potential destination. As many as 11 of the 40 companies surveyed that would like to move away can imagine the USA as a new location.

Start-ups remain confident

Companies that want to stay in Germany are also concerned about venture capital. 123 of the 152 companies surveyed noted a reluctance for investors, which they attribute to the weak economic situation. According to Bitkom, start-ups will need an average of around 2.5 million euros in fresh capital over the next two years. This means that only one in four start-ups believes they will have sufficient financing for the next two years.

Nevertheless, Bitkom notes a certain degree of confidence: almost 80% of the companies surveyed consider it likely or very likely that they will be able to raise the necessary capital. According to Bitkom, half of the companies can imagine raising financing via an IPO.

(dahe)