July 26, 2023

DACH Startups Decoded: Key trends & opportunities unveiled in our report

Dive into the latest perspectives, insights,
and updates from our global community.

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Amidst a period of swift technological progress and a flourishing entrepreneurial drive, the DACH region has firmly cemented its position as a dominant force in the European startup scene.

Due to the region’s strong tradition of engineering excellence and skilled talent pool, the DACH startup ecosystem has flourished, attracting global attention and investment.

In fact, for more than a decade, at NGP Capital, we have had a front-row seat in witnessing the evolution of the region’s ecosystem having backed leading category-creators such as GetYourGuide, Scandit, ANYbotics, Babbel, and Clue.

During this time, we have seen how the region has given birth to a wide range of startups spanning diverse sectors, including fintech, e-commerce, health tech, mobility, and artificial intelligence. From Berlin to Vienna to Zurich, innovation hubs have emerged.

DACH-based startups not only disrupt traditional industries but also created new markets, redefined business models, and addressed pressing societal challenges.

Despite all the strides, the last year and a half have been rocky for the global startup world, and the DACH region has not been immune to these challenges.

So, in our latest report published today, we aim to decode the current state of the DACH startup ecosystem, by analyzing trends across dealmaking, fundraising and exits to identify key opportunities and the challenges that lie ahead.

Our DACH Startups Decoded report compares data from the beginning of Q1 (January) 2020 up to the end of Q2 (June) 2023, and analyzes over 3905 companies and 5644 funding rounds from across Germany, Switzerland, Austria, and Liechtenstein.

Some of the key findings in the report include:

1) Germany’s funding levels dropped less than other European markets of a similar size in between the first half of 2022 and the same period in 2023. With Germany experiencing a 37% slowdown, compared to France and the UK, who saw declines of 54% and 40% respectively.

2) Encouraging signs of stability began to emerge this year (2023), with VC funding levels in the DACH region returning to pre-2021’s ‘fundraising bubble’ levels.

3) DACH-based generative AI startups attracted more funding ($248M) in Q2 2023 than they did during the whole of 2022 ($210M).

4) DACH-based travel, food, and health-tech startups have thrived during the first half of 2023. With funding in travel (+52%), foodtech (+38%), and health and life sciences (+5%) all seeing noteworthy funding increases compared to levels in the first half of 2022.

At NGP, we take great pride in leveraging "Q" - our data & ML platform, which aggregates data across multiple sources. By analyzing the region's entrepreneurial landscape, we aim to provide valuable insights and guidance to founders, investors, and policymakers who seek to navigate this vibrant and dynamic ecosystem.

The DACH region has emerged as a powerhouse in the European startup scene. Despite recent challenges, our latest report reveals encouraging signs of recovery and exciting opportunities. Don't miss out on the insights that can shape your next move in this dynamic ecosystem. Read our DACH Startups Decoded report now and stay ahead of the game!