The German fintech scene is growing. At the same time, more and more venture capital is flowing into financial startups. Munich is defending its position in the rankings.
A study by Comdirect and Barkow Consulting counted a total of 898 fintech startups in Germany as of the end of September. According to the study, 53 new fintechs have been added in the first nine months of this year. In the past three years, only between 30 and 49 new startups were recorded at the same time.
Blockchain on the rise
The largest group of the 898 fintech startups, with 202 companies, are proptechs, i.e., start-ups that deal with real estate. 172 startups deal with financing. The third-largest category, with 114 startups, is insurtech companies. The study classifies 96 fintech companies as belonging to the investment sector. The number of blockchain startups has grown the most. With 76 companies now dealing with crypto technology, this category has surpassed the number of accounting startups (72) for the first time. The total number of all fintech startups has grown by a quarter since the end of 2017. The number of blockchain startups has even more than doubled since then.
Record level of venture capital invested
The growth in venture capital invested is also impressive: In the first nine months of this year, more venture capital was invested in the German fintech scene than in all previous full years: almost 1.3 billion euros of venture capital has already flowed into financial startups this year. In the entire previous year In 2016 it was less than 1.2 billion, and in the two previous years it was only around 700 million euros each.
Large fintechs, in particular, are able to benefit from the VC boom. However, the amount of money flowing in is declining. The 20 German fintechs with the largest VC volume have attracted almost half of the total venture capital invested so far this year. Arno Walter, CEO of Comdirect, says:
"We are seeing increasing concentration in the German fintech scene: fewer and fewer financial startups are raising more and more venture capital. At the same time, however, the startup dynamic remains high. Even smaller fintechs are apparently succeeding in developing new business models without large financing rounds—often by deliberately seeking cooperation with banks."
Munich is Fintech runner-up
Berlin clearly dominates the Fintech location comparison. In terms of the number of financial startups, new companies, and venture capital invested, the capital city clearly ranks first in Germany. In terms of the number of Fintechs and new companies, Munich and Frankfurt follow roughly on par. As in the two previous years In the end, however, Munich clearly emerges as the fintech runner-up: In terms of both the amount of venture capital invested and the number of VC rounds, Munich is well ahead of the metropolis on the Main River: Almost six times as much capital flowed into the Bavarian capital as into Frankfurt's fintechs. Hamburg takes fourth place.
