The Hanseatic city of Hamburg attracts founders and investors not only because it is the largest German seaport and its logistic infrastructure, but also because it has a skilled workforce and a high-quality of life. Several industries have a strong presence and high start-up activity in Hamburg. These include logistics, consumer goods, renewable energy, media and the IT-sector. This article explores the start-up ecosystem in Hamburg as well as successful entrepreneurs and start-ups.
Start-ups in Hamburg at a Glance
Currently, there are 1.271 start-ups operating their business in Hamburg. Compared to 2019, 218 new enterprises were founded. According to the start-up monitor of PwC for Hamburg, around one-third of the start-ups are active in the category of information and communication technology and 80% have digital business models. Around 26% of the start-ups are offering SaaS solutions whereas 25% operate an online platform. Find out more about the German technology sector in this article.
Overall, the average start-up in Hamburg is three years old and employs around 21 people, which is higher compared to the national average of 16.7 employees. Hamburg’s start-ups are usually set up by 2 to 3 founders. The founders are around 36 years old and 84% of the start-ups in Hamburg are founded by men.
The average annual turnover of Hamburg-based young companies is €1.7 million. In regard to financing options, around 80% of these start-ups have raised external capital and 50% have worked with a business angel. In general, the majority of founders are interested in cooperating with established companies in order to scale their business. Moreover, seven out of ten start-ups plan to expand internationally in the next few years.
Funding Opportunities for Start-ups in Hamburg
- Entrepreneurs and start-ups that are younger than 5 years and whose business is registered in Hamburg can receive investment from the Innovation Starter Fund at the Hamburgische Investitions- und Förderbank (IFB). The bank will get 15% business shares in return for an investment sum of €0.6 million for one round of financing. In total, the start-up can raise up to €1 million with several funding rounds. Another requirement is the legal form of a corporation (GmbH, AG, UG) and the companies should have less than 50 employees.
- The Hamburg Investment and Development bank further initiated the InnoFounder (IF) funding program supporting entrepreneurs in the pre-founding and start-up phase with personal grants of up to €75.000. This program is particularly designed for start-ups from the digital field as well as social entrepreneurs. Read more about social entrepreneurship in this article.
- Next to the InnoFounder program, the IFB has further established the InnoRampUp (IRU) funding program for innovative startups in the field of technology. The start-ups can receive grants of up to €150.000.
All of the three initiatives mentioned above are financed and supported by the Ministry of Economic Affairs and Innovation of the Free and Hanseatic City of Hamburg (BWI) and the European Regional Development Fund (ERDF).
Awards, networks and research projects for start-ups in Hamburg
- The City of Hamburg highlights innovative solutions for the city of tomorrow with the Future Hamburg award. The award-winning start-ups aim to deliver ideas for challenges within large cities such as traffic, sustainability, emission or the overall lack of space. These topics are closely related to the area of transportation and logistics which are key sectors of Hamburg. The competition for this award is open to German as well as international start-ups and enables them to participate in an accelerator program in Silicon Valley.
- The Plug and Play Tech Center in Hamburg connects start-ups and entrepreneurs with accelerators, investors, universities and companies to facilitate exchange and growth and to create an ecosystem of innovation. The center runs innovation programs twice a year. The program focuses on young companies active in the areas of logistics, supply chain, smart cities and AI. The Plug and Play Innovation group has other locations in Stuttgart, Frankfurt and Munich as well as in the US, Europe and Asia.
- In 2020, the city of Hamburg started testing the RealLab Hamburg, an initiative interested in the digital mobility of tomorrow. This project aims to develop climate friendly smart cities and mobility systems and is funded with €21 million by the Federal Ministry of Transport and Digital Infrastructure. The program is divided into 10 smaller projects and start-ups ranging from on-demand shuttles to microdeposits. The results of these projects will be presented at the Intelligent Transport Systems and Services World Congress (ITS) taking place in October 2021.
Growing start-ups from Hamburg
- The Hamburg-based green tech start-up LignoPure is using lingnin, a wood waste material, to replace plastic and produce care products and leather with lingnin. In 2021, the start-up raised € 2.2 million of funding from the High-Tech Gründerfonds, the Innovation Starter Fund mentioned above and the Swiss Holding Tanovis AG. Founded in 2019, LignoPure has received the German StartGreen Award and the Future Hamburg Award.
- The sustainable FinTech Tomorrow was founded in 2018 in Hamburg. This mobile bank invests the money of their customers in sustainable or environmental projects through every service or product that they are offering. They stand for an easy, digital interface and offer their customers to offset their carbon footprint. The credit card has an incorporated donation function directed to deforestation initiatives in Brazil and lets its users track how many trees have been planted so far. Tomorrow has currently 70.000 customers with deposits with €70 million of customer deposit. Find out more about Germany’s FinTech industry in this article.
- The AI-based platform Aiconix optimizes video creation by delivering useful data insights about video content and customer behaviour. This can be helpful for advertising for example as the software detects when faces or objects appear in the video and can transform language to transcripts or automate subtitles in different languages. Overall, this will enable content creators to increase their viewing rates. In 2019, Aiconix was featured in the top 30 AI start-ups of Forbes Magazine in Germany.
- The Digital Health Start-up aidhere was founded in 2019 and develops and oversees digital health-related behavioral therapy programs. The first product is the digital obesity program zanadio, which enables patients to reduce their weight long term. In addition to videos and exercises, the app further connects patients with personal coaches. Find out more about the German life sciences and health sector in this industry overview.
Centurion Plus
Whether you are an entrepreneur or an investor looking for the next big scale-up, the Hanseatic city Hamburg offers many opportunities for start-ups. From the choice of the right legal form, questions about intellectual property protection, as well as advice on equity investments and partnerships of start-ups – entrepreneurs need legal support.
Our team of flexible lawyers can help you with all these queries.
Contact Centurion Plus today for an initial consultation.
