German Tech Startups | A Look at Speedinvest's Portfolio in Germany
Since 2011, we've invested in nearly 300 startups in more than 40 nations. Germany, the United Kingdom, Austria, France, and Spain are currently the countries we've invested in most in Europe. Why and in what companies? Keep reading for a deep dive into our German portfolio and exclusive market insights from our sector-focused investors. Click below for a breakdown of our other top European markets.
German Tech Startups: A Hub of Innovation
Germany has been steadily cementing itself as a preeminent hub of startup innovation and investment, not just in Europe, but globally. Europe’s largest economy and the combined German-speaking market of DACH account for more than 100 million affluent customers, representing a highly attractive market to conquer at the heart of the European Union. That’s why a number of internationally successful tech companies, both in the B2B and B2C space, initially launched in Germany, such as SAP, Delivery Hero, Zalando, N26, Scout Group, Celonis, Contentful, Personio, Instana, and TeamViewer.
Looking at GP.Bullhound’s Titans of Tech 2022, we can see that some of the biggest unicorns come from fintech and marketplaces––which feeds into our sector-focused approach. And over the past decade, Berlin alone has seen investment in its startups rise from a net total of €1 billion in 2016 to €5.1 billion in 2021. Significant rounds for N26, TradeRepublic, and some of our very own German unicorns––TIER Mobility, wefox, and soonicorns CoachHub and Billie––have made that possible.
According to Deutscher Startup Monitor, there are nearly 5,000 founders who’ve started 1,976 startups across the country, employing 34,539 individuals as of September 2022. Their report also shows that 19.1 percent of German startups are headquartered in Berlin and 13.6 percent are based in Munich where we have Speedinvest feet on the ground.
But Germany’s startup landscape is ultimately decentralized with deep tech clusters around universities, like RWTH Aachen, TU Munich, and KIT in Karlsruhe as well as Frankfurt’s fintech presence and global startup hubs, such as Berlin. That's why we have two dedicated German offices in Berlin and Munich, and investors from our six dedicated sector-focused teams on-the-ground across the country. With nearly 70 investments in German tech startups (so far!), we're clearly excited about the opportunities in the market. And we're just getting started.
“At Speedinvest, we’ve been fortunate to help shape the rise of the German startup ecosystem over the years and we continue to be excited about its potential. While the number of German tech unicorns and startups have been steadily growing, Germany’s VC investment per capita is still lagging behind leading economies, such as the US and the UK, demonstrating the amazing potential Germany still offers.” –– Mathias Ockenfels, General Partner at Speedinvest
Speedinvest's Germany Deal Flow
With such a mature ecosystem, it’s no surprise that Germany remains one of our leading sources of deal flow with thousands of founder pitches received over the last several years alone. Total pitches received continues to increase year on year, despite a very small COVID-related dip last year, 2022 pitch levels are back on track.
An Overview of our German Tech Startups
From our offices in Berlin and Munich, we’re constantly scouring for additional opportunities for investment in Germany. No matter what the state of the market is, our cross-sector investment teams actively partner with founders building deep tech, fintech, and healthtech to industrial tech, marketplaces & consumer, and SaaS & Infra startups. They also collaboratively fund the technologies that are reshaping our industries, redefining global economies, and securing a future for us all––climate tech, crypto, and emerging markets.
For decades, Germany has led the way in European deep tech innovation. Munich is home to the Quantum Valley, a hub that bridges the gap between research, industry professionals, funders, and the public at large. This is on top of multiple universities and major startup hubs, like Berlin, where we’ve been working with founders since launching in 2011.
A perfect example, we partnered with cylib out of RWTH Aachen University where they've developed the most efficient and sustainable proprietary process for recycling lithium-ion batteries on the planet. The female-led team with proprietary E2E recycling technology is building a pilot plant in Aachen to scale up and industrialize their tech. And our portfolio company, Munich-based planqc, is taking quantum computers to the next level. By storing information in individual atoms –– nature's best qubits –– they’re building the fastest way to scale to thousands of qubits, a prerequisite for industry-relevant quantum advantage.
“In Germany, deep tech has become increasingly important as a source of innovation and economic growth, especially among quantum computing, Artificial Intelligence and advanced materials. We love the German deep tech ecosystem and we’re looking forward to working with scientists and engineers who have deep knowledge of a particular field to create new industries and make a significant impact on the world economy.” –– Rick Hao, Partner at Speedinvest
Germany is the fourth largest fintech market in the world, so it’s no surprise that we’re heavily investing in this space with portfolio companies, like Unstoppable Finance, Receeve, Afilio, and Upvest. Berlin-based soonicorn Billie raised a $100 million Series C to help small businesses get access to working capital by allowing them to finance against open invoices.
Then, of course there’s wefox, a Berlin unicorn that allows customers, brokers, and insurance companies to digitally manage their insurance products.
“Speedinvest has been a value-add partner from the very beginning,” said wefox CEO and founder, Julian Teicke. “They not only helped us establish a successful framework for testing and optimizing our growth and marketing strategy, but have also been instrumental in our international expansion efforts.”
The all-in-one finance platform for SMBs in Europe, Friday Finance (founded by a former Speedinvest employee), closed a $20 million Series A round. CANDIS raised a $16 million Series C to continue growing the company, expand their team, and improve their product that helps small and medium-sized businesses automate bookkeeping and financial workflows using artificial intelligence.
“Despite the gigantic rise of financial technology in Germany over the years, incumbent banks and insurance companies have innovated little and still keep very dominant market shares. This clearly tells us that we’re just on the brink of a much more tectonic change in the financial services landscape in the years to come. With Germany as the largest financial hub in the EU and with Berlin as European crypto capital, we at Speedinvest are keen to double down on fintech.” –– Tom Filip Lesche, Partner
Germany’s healthtech ecosystem is a mature, booming market forecasted to grow to approximately €38 billion by 2025 based on information from the Federal Ministry for Economic Affairs and Energy.
Earlier this year, we reported on 2021 being a record-breaking year for both healthtech founders and investors in DACH. We argued that one of the reasons for more activity in the digital health space was regulatory advancements and a number of initiatives, specifically in Germany, such as the country's commitment to investing significantly in the modernization of hospital IT systems and fostering digitization. This environment and regulatory tailwinds have led to an increase in the quantity and skill of founder teams tackling challenges in the healthcare system. As a result, serial founders from other sectors are more likely to start something new in this space, and healthcare professionals are challenging the status quo more often with solutions they want to build from the ground up.
Challenging the status quo is precisely what we’re looking for, which is why we're excited to partner with the team at Doctorly, who are bringing practice management software to the 21st century. Another disruptive German healthtech company we are excited to back is DasLab, which is building digital lab test infrastructure for the entire healthcare ecosystem. The German healthtech startup recently partnered with Zava to offer reimbursable, at-home diagnostics in Germany. We’ve also recently partnered with nilo.health, which provides mental health & well-being support for a company's entire workforce.
Another partner, Molecule, is a pioneer of DeSci that uses an open platform to bridge the gap between life science research and funding. This empowers stakeholders in drug development to work together and expedite the process of bringing novel therapeutics to patients.
“Boasting a buzzing tech scene and one of the best healthcare systems in the world , international digital health startups are moving at full throttle into Europe’s largest healthcare market. We’re excited to contribute further into this ecosystem.” –– Nadhila Wardhana, Analyst at Speedinvest
Marketplaces & Consumer
We’ve been especially active in Germany’s Marketplaces & Consumer sector with our team making 14 investments so far. Already back in 2018, we launched The Marketplace Conference in Berlin. The annual event focuses on all things marketplaces and unites marketplace entrepreneurs, investors, and industry experts. It provides a platform for exchanging know how and best practices, attracting marketplaces entrepreneurs and investors of all stages.
Looking at our portfolio, we have to start with our unicorn, TIER Mobility. It’s now the world’s largest micro-mobility operator with scooters and bikes now on streets across the globe. In this blog post, Mathias summarized how our journey with TIER started.
GoStudent became Europe’s most successful edtech in the midst of COVID, raising an impressive $340 million Series D to help fuel their push into additional international markets. And another company that we’ve backed since day one is Berlin-based CoachHub, a pre-Seed investment turned soonicorn that’s offering a turnkey solution to transform your managers into highly effective, inspiring leaders. The company closed a $200 million Series C in which we participated as well. Our partner Inkitt also closed an impressive follow-on round with a €50 million Series B. The digital publishing platform uses a unique algorithm to predict book success and connects popular authors and their manuscripts with publishers.
B2B Marketplaces are also a growing focus of our investment strategy in Germany. Schüttflix, which announced a €43.1 million Series A, is a B2B marketplace and delivery platform for bulk construction supplies. The first of its kind, connecting suppliers and truckers directly with customers in the landscaping and heavy construction industry with remarkable same-day service and four-hour delivery to their core market.
We are convinced that marketplaces and platforms with strong network effects are also key to solving the climate crisis. That’s why we actively partner with climate-focused platforms like Planetly, one of our team’s most successful exits to date. The Berlin-based company was acquired by US-based OneTrust in 2021 where they’ll continue their mission of lowering carbon footprints with their digital tools that empower companies to analyze, reduce, and compensate for their CO2 emissions. Our partner Liefergrün also has carbon footprints in mind with their carbon neutral last mile delivery platform allowing guilt-free online shopping platform by reducing the environmental impact of e-commerce deliveries. They landed a €12 million Series A to continue scaling their business across Germany and beyond. And in April, Raus secured a $3 million pre-seed round for their sustainable cabins startup that brings people closer to nature.
Additional partnerships this year include B2C food-focused startups GoTiger and Milano Vice. Since EdTech is an important pillar of our investment thesis, we also led a Seed round in Codary, an online learning platform teaching kids 21st century skills through free gamified coding content and paid live programming classes taught by experienced tutors.
“Marketplaces and Platforms require scale for network effects to kick in and unfold. Companies like Delivery Hero, HelloFresh or Zalando have proven that Germany can give birth to billion dollar marketplaces and consumer exits. As Europe’s largest economy, Germany is the market to conquer for any marketplace founder with big, international ambitions. With companies like TIER, CoachHub, and wefox under our belt and our feet on the ground in Berlin and Munich, we’re here to support you in doing so.” –– Mathias Ockenfels, General Partner at Speedinvest
According to our 2022 Industrial Tech Report, Germany is the preeminent industrial tech hub of Europe. As of this writing, the German industrial tech industry has received $1.4 billion in investment. That’s nearly double the next-largest hub, France, with $827 million to date. It’s a diverse space with increasing attention paid to climate tech where we predict $2.3 billion of total investment in Europe by the end of the year with some of the top recipients in Germany.
Climate has similarly been a focus of our Industrial Tech team with partnerships with startups like NeoCarbon where they’re offering DAC (direct air capture) solutions for industries at significantly lower costs. In September we joined in a pre-Seed funding round of €1.25 million. And just a week later, we co-led a €10.5 million Seed fund for one.five where they're researching sustainable (and affordable) packaging alternatives that can be deployed at scale. Industry needs sustainable solutions and we will continue partnering with startups working in this space.
That is why we’ve also partnered with TWAICE where they’re creating more sustainable and reliable solutions to reduce battery development and testing costs for electric vehicle manufacturers, as well as providing real time insights of the status of batteries. They’ve since partnered with TÜV Rheinland, sharing their technology to help assess the status of used batteries in cars. The new Battery Quick Check service offers customers a detailed report about the health of their battery. And there’s our partner, Resourcify, that helps companies control and improve their recycling through a waste management platform. They raised an additional €5 million earlier this year.
In the B2B space, we partnered with the aforementioned Schüttflix. Earlier in the summer, we also helped with CELUS’ €25 million Series A. The additional funding is set to help the Munich-based startup boost their mission to automate electronics design––a trillion dollar market. Our Industrial Tech team are also proud partners of Sunhero, Remberg, and Fernride, that all are on the journey to change their industry segment.
“Industry is the core of the German economy but it’s also facing enormous challenges due to demographics, decarbonization and deglobalization. This means transforming industry into a more sustainable and more digital future is key, and we think startups and innovation will play an important role in that generational shift.” –– Andreas Schwarzenbrunner, Partner at Speedinvest
SaaS & Infra
SaaS & Infra in Germany is an especially promising field, one we’ve been actively investing in for years. So far we’ve racked up more than 10 investments in this space and have no intention of slowing down.
We’ve partnered with Gigs, the first telecom-as-a-service platform with custom phone and data plans that allows customers to subscribe and manage their phone plan with just a few clicks. They pulled in an impressive $21 million Series A to help them scale in response to growing demand.
There’s also our partner Gitpod, an open source development platform for teams used by more than 750,000 developers to efficiently and securely develop software together. On the heels of their $25 million Series A led by Tom Preston-Werner (Founder of GitHub). Gitpod introduced Cloud Development Environments (CDEs) to solve the ‘works on my machine’ problem.
Elsewhere in SaaS we partnered with Legal OS. They’re transforming your contract library and legal expertise into a digital knowledge base with the goal of making contract drafting easy without sacrificing quality and have recently closed their Series A. And there’s Hier Foods, a startup building a digital infrastructure for local food.
“We’ve seen many outstanding SaaS companies in Germany, next to amazing applications also (and especially) in the API and dev tooling space. Hence we’ve decided to double down on the German market and recently increased the size of our SaaS & Infra team in Germany. We’re beyond excited to meet the next wave of outstanding entrepreneurs.” –– Markus Lang, Partner at Speedinvest