A recent survey of German tech startups reveals a nuanced picture of the current economic landscape, with experiences varying considerably across the sector. Published today by industry association Bitkom, the findings indicate that 37 percent of startups report an improvement in their economic situation over the past two years, an increase from 31 percent recorded in the previous year.
However, a significant 31 percent conversely state that their situation has deteriorated, up from 24 percent a year ago. The proportion of companies maintaining a stable status quo has decreased noticeably, falling from 41 percent to 28 percent.
While individual company performance remains mildly positive on average, the overall outlook for the startup ecosystem is more cautious. Only 21 percent of respondents observe an improvement in overall economic conditions for startups – a slight decrease from 23 percent in 2024. Conversely, 47 percent report a worsening, compared to 45 percent previously. A concerning 15 percent of startups now express fears of potential insolvency within the next twelve months, a rise from 11 percent a year ago.
Startups identified bureaucracy (63 percent), sales & customer acquisition (61 percent) and financing & capital procurement (52 percent) as their major challenges. Difficulty accessing public contracts (39 percent) and scaling their business model (39 percent) also feature prominently.
Regulatory uncertainty, particularly surrounding data protection and emerging legislation like the AI Act, is a concern for 34 percent of companies. A further 21 percent cite product development issues, while 19 percent struggle with skills shortages, 16 percent with technological hurdles, 13 percent with a lack of demand and 11 percent with competitive pressures.
The survey, conducted online between the 12th and 21st calendar week, gathered responses from 152 German tech startups.