The boom in artificial intelligence is giving the startup industry a boost.

Despite the economic downturn, significantly more startups are emerging in Germany. According to an analysis by the Startup Association, 1,500 new growth companies were founded in the first half of the year – 9 percent more than in the second half of 2024. "If this trend continues, the number of new startups per year could exceed 3,000 for the first time since 2021." The association wrote that more companies were founded, particularly in Saxony, Bavaria, and North Rhine-Westphalia.

With the increase in new start-ups in Germany, the startup sector continues to recover from the crisis following the end of the coronavirus boom. While almost 3,200 new startups were founded in 2021, the number fell to just under 2,500 in 2023. At that time, many investors held back due to rising interest rates and economic concerns. Some startups ran into financial difficulties and cut jobs, and the number of insolvencies rose. The number of startups has been rising again for the past two years. The trend in funding for startups is also upward, as recent figures from KfW show.

Most startups have recently emerged in the software sector, driven by the boom in artificial intelligence (AI). Industrial solutions such as AI-supported automation are gaining importance, according to the startup association. But the long-sluggish online retail sector is also seeing a resurgence.

While most startups were founded in Bavaria (343), North Rhine-Westphalia (281), and Berlin (248), research-oriented locations rank high in the city rankings. Calculated per 100,000 inhabitants, Munich had the highest number of new startups founded within twelve months (13.5), followed by Heidelberg (13.4) and Berlin (13.2). The university cities of Darmstadt (11.5) and Aachen (9.1) also performed well. Successful startups are continually emerging in the vicinity of universities, and at the same time, there are a growing number of professorships for entrepreneurship.

In addition to the hotspots of Berlin and Munich, smaller research-oriented locations are "the new engines of the startup ecosystem," wrote the Startup Association. This broadens the startup industry's footprint, but bridges must be built between the two worlds.