July 22, 2023

Berlin has overtaken Paris and Amsterdam in the Startup Ecosystems ranking 2023.

Berlin has managed to create a special attractive atmosphere for start-ups and creative people, whereas the country’s powerful industry provides a demand for innovation, all this together creates the basis for further growth of the startup market.

According to StartupGenome-2023 report Berlin ranks 13th in global race in 2023 (+3 points), in 2022 16th (+6 points), spectacular growth. Amsterdam-Delta has not changed position since 2022 14th place in the 2023 ranking, in 2022 compared to 2021 (-1 points). Paris lost positions two years in a row in 2023 18th place in the ranking (-3 points), in 2022, 15th place relative to 2021 (- 3 points).

Only 3 cities representing the EU in the top twenty of the Startup Ecosystems ranking - Berlin, Paris and Amsterdam. At the same time, in terms of population , the largest cities of the EU, including Berlin, significantly inferior to the other cities of the top twenty of the rating. The only exception is Tel-a-Viv, it’s in the top 20, but the resident population is less than 1 million. The fact that, despite the difference in population, these cities successfully develop a startup ecosystem, and it proves their super efficiency.

Experts predict that by the end of 2023, Berlin will continue to rapidly increase the number of start-ups, according to a study published  by the Federal Association of German Startups, Berlin in the first half of 2023 has come back after the slump 2022 with 40 percent more start-ups.

In previous years German startups  experienced a long boom and  2021 showed the record levels of investor financing. During the pandemic, digitization got a boost – especially in financial transactions, food deliveries and online shopping. After the slump in start-ups in 2022 because of the rising interest rates and uncertainty in the economy, in 2023 the startup market retuned to the trajectory of rapid growth.

The 40 percent increase in number of newly established start-ups (1H 2023) confirmed that Berlin ecosystem is efficient.

According to Association of German Startups experts, due to the multiplier effect, young innovative companies directly or indirectly created about 1.6 million jobs in Germany. This is already more jobs than in the automotive and chemical industries combined.

A significant factor that helped to overcome the failure of 2022 was the increase in government support and the launch of the new Startup strategy for Germany. The roadmap unlocks €30 billion in funding by 2030.

The main objectives of the Startup strategy:

- strengthen financing for startups,

- help startups to attract talent including through improved employee ownership opportunities,

- develop a spirit of entrepreneurship and facilitate the setting up of new businesses including digitally,

- strengthen female entrepreneurs and support diversity in startups,

- facilitate startup spin-offs from science and universities,

- improve the policy environment for startups which serve the common good,

- mobilise startup competencies for public contracts,

- make it easier for startups to access data,

- strengthen regulatory sandboxes and facilitate access to them for startups

In addition to the launch and implementation of the Startup Development Strategy, experts identify several significant areas and projects that create a positive impulse to the development of the startup ecosystem:

- At least 10 major international technology conferences are held annually in Berlin. We can single out as one of the most significant – “Hub. Berlin” the business festival for tech und digitalization which brings together local and international innovators each summer. In addition to technological and business events, a special environment for attracting innovators and creative youth, of course, creates a cultural environment and a recognizable style of the city.

- One of keystones of the ecosystem is the German startup association. The activity of the Association is based on a very serious analytical base- “The German Startup Monitor” is the most comprehensive research into the startup ecosystem in Germany. Research started in 2013 and nowadays it is one of the most comprehensive analytical reports among developed countries.

- We also highlight the activity of the largest technology corporations that actively influence the creation of new education formats. As a case in point, in 2022, one can highlight ABB's “Learning Factory Industry 4.0”: Some 359 apprentices are studding at training programs at ABB cluster in Germany in 2022/2023.

We consider that Berlin has managed to develop its own unique model of a startup ecosystem and sure it will continue to actively develop following the spirit of the times.

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