One year later: Taking stock of Germany’s startup policy

  • The German coalition agreement from 2018 contains 25 projects that would benefit startups
  • Since then, four of these projects have been fully implemented, but nine have not been addressed yet

Berlin, 15 March 2019 - Startups had a lot of reasons to be excited about the coalition agreement between the CDU (Christian Democratic Union) and the SPD (Socialdemocratic Party of Germany) from 2018. Among various initiatives and support programmes for startups and founders, the new government set out to introduce a digital investment fund, and allow aspiring entrepreneurs to take off time to pursue their startup projects. One year later, four out of 25 measures to support startups have already been fully implemented, twelve have at least partially been tackled, but nine have not been pursued yet. “The coalition agreement included strong proposals for startups. But so far the government has mainly implemented those that are just extensions of already existing measures. 2019 has to become the year of the startup, in which the big announcements are followed by actions”, says Bitkom President Achim Berg.

Among the implemented measures are funding increases and extensions for governmental support programmes like EXIST, INVEST, the high-tech founder’s fund HTGF and an innovation programme for SMEs (Zentrales Innovationsprogramm Mittelstand, ZIM). Since October 2018, the German Development Bank KfW furthermore has its own subsidiary to streamline venture capital funding. Likewise, Bitkom welcomes the expansion of the Digital Hub Initiative of the German government, both financially and in scope. The new “startup card” also enables founders to work at more than one hundred places in Germany free of charge.

Lack of skilled workers will be addressed through a new German law on immigration of skilled workers, and a national professional training strategy is in the works to build on existing initiatives in the field.

However, lessening the bureaucratic burden for startups is a field that still requires a lot of work. Announced measures to drop requirements on value added tax or providing various statistics have so far not been implemented. The beta version of the online administration portal presently only allows for a fraction of administration requests to be fulfilled online.

Other announced measures have not been put into practice at all. Among these are a promised change of bankruptcy rules, the introduction of a sabbatical for entrepreneurs and new ways of involving employees in a company. The national digital investment fund is also still absent. Bitkom President Berg: “The national digital investment fund would be especially important to attract institutional investors and mobilise additional private venture capital in Germany.”

More information and evaluation of all 25 measures here (in German):