Germany offers a variety of resources supporting start-ups, from formulating a business idea to scaling their business. This article takes a closer look at the most important incubators, accelerators and university entrepreneurship centres in Germany.
Incubators for German start-ups
Incubators support start-ups not only financially but more importantly offer access to a large industry network and business coaching experts or mentors that have worked in the start-up scene for years. Moreover, they provide founders and young companies with the necessary tools and infrastructure to succeed. They aim to optimise the business idea, analyse the potential market, develop a company strategy and most importantly, find suitable cooperation partners and investors. Financial support from incubators can range from €100.000 to 1 million. In exchange for financial support and consulting services, incubators usually receive a large company share in return for their investment.
Often incubators are initiated by large companies that aim to foster relationships with start-ups to increase innovation in their own businesses and spot potential investment opportunities. The following list consists of some of the largest incubators led by German companies.
- Allianz Digital Accelerator: this innovation lab supports in particular InsureTech start-ups as Allianz is a market leader of the insurance industry. Participants of the incubator program are employed by the Allianz group as entrepreneurs in residence and work together in a team of experts who have knowledge in the area of building new businesses. If the start-up is successful it might receive investment from Allianz X, the digital investment unit of the Allianz Group. This investment arm of the insurance giant invests in FinTechs and InsureTech around the world. One of the most recent projects was the series D funding round for the US start-up Pie insurance, a digital insurance company for small businesses They invested US$118 million in March 2021.
- Hubraum, is a tech incubator from the telecommunications company Deutsche Telekom, supporting early-stage startups. The incubator was established in 2012 and has offices in Berlin, Krakow and Tel Aviv. Overall, they have invested over US$70 million in promising start-ups. Most of them are active in the fields of AI, 5G and IoT.
- Rocket Internet is considered as one of the most prominent incubators offering deep operational support for promising start-ups. Rocket Internet, headquartered in Berlin, is often referred to as the German “start-up factory” due to its list of successful start-up exists. Among them are Zalando, Delivery Hero, Hello Fresh and Home24.
- The Main incubator GmbH, is a subsidiary of the German bank Commerzbank. Next to research and development support the company further acts as an early-stage investor for start-ups from the fields of FinTech and PropTech as well as AI, robotics and quantum computing. The Main incubator currently has a portfolio of 22 companies from Europe. Two of their start-ups have achieved a successful exit. One of them is Retresco, a company focusing on automated content and language generation, and the other one is traxpay, a B2B transaction company.
Accelerators for German start-ups
In contrast to incubators that develop ideas into actual companies and business models, accelerators work with already existing companies to scale their business. Accelerators aim to speed up the business development of recently founded companies. In contrast to incubators, the time commitment is limited in an accelerator. Within a certain period of time, usually between 3 and 6 months, the start-ups are advised in the areas of idea development and implementation. Often, a certain amount of capital and office space is provided. As a rule, the program is free of charge.
- The German Accelerator is operated by German Entrepreneurship GmbH and supported by the Federal Ministry of Economics and Energy. A team of successful entrepreneurs, investors and start-up experts accompany promising German startups through their international expansion. At the innovation locations Silicon Valley, New York, Boston and Singapore, participants in the Accelerator Program receive free office space, direct access to a global network of investors and coaching services from industry experts. The German Accelerator was launched in 2012 and has supported more than 300 start-ups in the process of scaling their businesses. Overall, these companies have raised more than US$4.9 billion in funding so far. Their programs are free of charge and range from a one-day kickstart session evaluating the possibility of an international expansion to the 3-months program in one of the innovation locations worldwide. Strategic partners of the German accelerator are Deloitte, Deutsche Bank and Salesforce.
- The Berlin-based Axel Springer Plug and Play pre-seed Accelerator was founded in 2013 and has a portfolio of more than 100 companies. The accelerator offers a global network. Three times a year they run their accelerator program for three months, providing office space coaching and financial support of €25.000 for 5% equity. Their current portfolio consists of an augmented reality B2B SaaS company RoomAR of the furniture sector, as well as social start-ups like Myo, that facilitates the communication between nursing homes and relatives through an app.
- The Microsoft Accelerator in Berlin, called Scaleup, is part of Microsoft’s start-up business unit. This four-month intensive program offers support and access to marketing, sales and especially technological expertise for established European and some US start-ups in the process of scaling their business. The focus lays on software startups. Microsoft further gives the start-ups access to their cloud platform Azur. On the last day of the program, young entrepreneurs can present their ideas and progress to large companies from the Microsoft network. The Microsoft for start-ups business unit further offers specialised accelerator programs for specific industries. For example, in the UK, the company has initiated a program in 2021 for healthcare start-ups that combine a social impact and purpose with data-driven innovative solutions. To find out more about social entrepreneurship in Germany take a look at this article.
University innovation labs supporting German start-ups
As technological innovation is driving economic change, universities are aiming to provide their students an ecosystem that fosters new ideas combined with research, and entrepreneurship. Students are looking to learn more skills than just theoretical knowledge. Some forward thinking universities are already trying to support the mindset of students who are willing to take risks, think outside the box and as a result develop new ideas that could potentially become an enterprise. In collaboration with industry networks these universities have established innovation labs and entrepreneurship centres to give students the necessary tools and resources to found their own company in the future. The following innovation and entrepreneurship facilities are located at renowned German universities.
- The technical university in Berlin has established the Beuth Startup Hub, which accompanies ambitious students from formulating their ideas into an actual business plan. Moreover, they offer business coaching, mentoring, financial support through scholarships or matching services to find the right co-founder.
- The renowned LMU University in Munich hosts regular start-up events through their LMU entrepreneurship center. One of these events is called the “Cashwalk” where young start-ups can pitch their ideas, business plans or established companies to more than 100 investors. The winners of the cashwalk 2020 edition ranged from the FinTech scene with Riskl.io to software start-ups like finway and the life sciences sector was represented by the start-up virtonomy.
- Entrepreneurship and innovation are of crucial importance for the German “start-up university” WHU. The WHU incubator offers a co-founding newsletter for motivated students, workspaces, contact to a large industry network and alumni founders, constant coaching opportunities and access to renowned investors through the WHU start-up roadshow. This event takes place in all large cities in Germany or virtually. Among the most successful start-ups recently founded by WHU students are kitchenstories, Carl Finance and evopark. The university has established an entire academic master of entrepreneurship and innovation combining academic research with practical experience.
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