As a recent study by Deutsche Börse and EY (Ernst & Young) shows, Germany isn't doing particularly well in international comparison when it comes to entrepreneurial spirit and the framework conditions for startups. The study compared the economic, tax, and regulatory attractiveness of startup ecosystems in Germany, Israel, the United Kingdom, and California (USA). The strengths and weaknesses of each location were analyzed, and recommendations for Germany as a business location were developed..
The tax system, capital requirements and bureaucracy – three issues that make Germany’s startup ecosystem look outdated compared to other international locations. current study As Deutsche Börse and EY show, while there is great growth potential in the startup sector in Germany, there is still plenty of room to catch up and improve compared to other countries. EY partner Christopher Schmitz said during the presentation of the study in Frankfurt:
"Germany is competing with international startup hubs for the current and future generations of founders. While Germany has seen positive developments in the economic environment for startups in recent years, the centers in Silicon Valley, Israel, and the UK still offer significant advantages for founders, particularly in terms of financing options and tax and regulatory frameworks."
“We must strengthen the entrepreneurial spirit in Germany”
Eric Leupold, Head of Pre-IPO and Capital Markets at Deutsche Börse, appeals to the entrepreneurial spirit:
"We need to strengthen the entrepreneurial spirit in Germany by encouraging founders to sometimes fail with their ideas. Investors see these experiences as very valuable."
Another sticking point for Leupold is the lack of access to sufficient capital:
"When startups move out of Germany, it's often because they find better financing opportunities elsewhere. Companies, politicians, and universities must work hand in hand if we want to make Germany more attractive for startups. Individual initiatives by the private sector or educational institutions are not enough to compete at the forefront internationally."
Small and medium-sized enterprises should have easier access to capital
Deutsche Börse aims to create a comprehensive ecosystem for growth in Europe and to support startups from the early growth phase through to a potential IPO. Deutsche Börse Venture Network In 2015, the company created a platform that supports startups in finding investors, building networks, and developing key skills. Deutsche Börse collaborates with universities and other partners to achieve this goal. The new stock market segment Scale was launched in March 2017, which aims to facilitate access to capital for small and medium-sized enterprises in all sectors.
On the study “The economic, tax and regulatory attractiveness of startup ecosystems”
