Garching near Munich, 02 March 2020. Germany's leading initiative for artificial intelligence (AI), appliedAI, has released its annual update of the Startup Landscape. The results show that the hype surrounding AI technology continues. Many of the startups on the landscape provide marketing and customer service solutions and only a few of the companies are operating within deep-tech areas such as IT and cybersecurity. Germans core industries such as manufacturing, transportation and mobility, as well as the healthcare sector are heavily represented.
German AI startups are doing well. In total, there are 247 young companies in Germany that use AI to a significant extent. Compared to the results from the previous year, this corresponds to an increase of 15%. 54 startups have been added since 2019, either because they were newly founded or because they now meet the criteria for inclusion on the map. Only a few startups from the previous year – a total of 21 companies – are no longer part of this year's map; either because they are no longer active or because they now have a different technology focus. "The survival rate of the included startups is 90%," says Dr. Andreas Liebl, Managing Director of appliedAI. "This is a great value and shows that startups with an AI focus are also developing positively in Germany. Since startups reflect the innovative capacity of countries, it is important to follow their development closely within Germany."
Startups raise 24% more capital than in the previous year
In terms of financing, there has been an increase of 24% capital raised since last years report – growing from 1.2 billion EUR to 2.2 billion EUR. The scaling trend is also continuing in terms of the number of employees: 23 AI startups already employ more than 100 people, compared to only nine startups in the previous year. Celonis is currently the only German AI startup with more than 500 employees. "These figures prove that German AI startups are increasingly 'growing up' and establishing themselves on the market. They are receiving more capital, employ more people and fail less often compared to other startups," comments Dr. Liebl.
Industry trends continue
As in the previous year, most AI startups are in the manufacturing, transport and mobility and healthcare sectors and have a B2B focus. Manufacturing in particular is growing compared to the previous year. The logistics, energy and pharmaceutical industries are among the lowest represented, while trade and finance are stagnating in the middle of the field. Only a few German AI startups deal with deep-tech topics such as IT and cybersecurity. "This could be due to a certain skepticism of German companies, which seem to avoid working with startups in strategically sensitive matters and prefer large, established companies in this area," says Dr. Liebl. If one compares the figures in the deep-tech sector with the USA or Israel, it becomes clear that there is definitely a need to catch up here. Most of the start-ups in Germany still belong to the marketing and customer service divisions.
Regional disparity remains
Roughly two thirds of all German AI startups are based in Berlin and Munich. Berlin remains the leader with 95 startups and Munich with 61. There is then a significant gap - Hamburg has 14 startups and Karlsruhe has 9. All other cities remain in the single digits. In terms of financing, Munich continues to provide an ideal ecosystem for startups due to its economic strength – on average Munich AI startups received 27 million euros compared to in Berlin where they received an average of 9 million.
Together with the support of NVIDIA and Google, as well as eight leading venture capital companies (Digital+ Partners, Earlybird Capital, eCAPITAL, High-Tech Founder Funds, HV Holtzbrinck Ventures, Lakestar, Speedinvest and Entrepreneurship Venture Capital Partners), more than 1,000 startups were examined. The startup map includes startups who were founded after 2010 and whose business model is based on machine learning. Companies needed to be either founded in Germany or operate significant business activities within Germany. The startups are collected and clustered based on the following criteria: access and availability of data, qualification of founders and employees, methodology, scalability of the business model and overall evaluation of the company.
For more information please visit the appliedAI website.
appliedAI is part of the UnternehmerTUM ecosystem. UnternehmerTUM is one of the largest innovation centers in Europe and non-profit. As a neutral platform for entrepreneurship and innovation, more than 200 employees serve more than 2500 individuals, >100 startups, and >100 companies per year. At appliedAI, we tackle the largest challenges by applying latest artificial intelligence technology to real use cases. We are convinced that we can create competitive advantages only if we start getting experience with AI powered products and services now.
UnternehmerTUM is a unique platform for the development of innovations. UnternehmerTUM actively identifies innovative technologies and initiates new business through the systematic networking of talents, technologies, capital and customers.
UnternehmerTUM offers founders and startups a complete service from the initial idea to IPO. A team of 240 experienced entrepreneurs, including scientists and investors, supports startups with business creation, market entry and financing – also with venture capital. For industry partners, UnternehmerTUM is a central platform for cooperation with new companies, and for expansion of their innovative strength and culture.
Founded in 2002 by the entrepreneur Susanne Klatten, UnternehmerTUM is the leading center for innovation and business creation in Europe with more than 50 high-growth technology startups every year - including Celonis, Konux and Lilium.