Federal Startup Association presents innovation agenda | tagesschau.de

The Federal Association of Startup Companies is presenting an innovation agenda today. It includes a list of demands for the federal government. Experts warn that Germany is squandering its great potential in new technologies.

The software company CibusCell has its headquarters just a few steps from the historic Speyer Cathedral. In the old building, a team of programmers is working on future technology. Specifically, the aim is to use green hydrogen as cost-effectively as possible. “We don’t just want to develop and sell a product, we also want to do something about climate change. That gives our work meaning,” explains Marcus Rübsam. “Our mission: Green hydrogen should become competitive with gas and coal.”

Rübsam is the founder and managing director of CibusCell. The startup began three years ago with three founders, and today 13 specialists are already working in Speyer. “We want to decarbonize entire industries with our software.” Special control software calculates various current data such as the weather, electricity prices and the capacity of hydrogen plants. “This way, the production process is monitored, transparent and economically optimized,” says founder Rübsam, explaining the business idea. Customers do not need their own IT department for this, everything runs in a cloud.

“Official procedures complicated”

“We started with a starting capital of around 100,000 euros from our own resources,” says the 54-year-old founder. “When it comes to financing, company founders have to take a multi-pronged approach.” There are many good funding opportunities, but “the official procedures are complicated and unfortunately take a long time.”

At the start, the three founders had to deal with the various applications almost full-time: “It was not easy to understand which authority wanted what and when,” Rübsam recalls. “It takes at least twelve months for the funds to arrive. In our fast-moving industry, that’s difficult.” In some cases, the initial idea was already outdated when the grants finally arrived.

Nevertheless, Rübsam emphasizes that the funding environment, especially from the state of Rhineland-Palatinate and also from the federal government, is good. However, in the US software mecca of Silicon Valley, access to funds is much quicker, says Rübsam from his travels. Private investors are lining up for interesting startups.

There, society has a completely different culture of risk-taking; failure is a badge of honor that is part of the later success of a business idea, Rübsam enthuses. “We have a completely different culture here in Germany. This is then continued by authorities, banks and private investors.”

The state also gives too much public money to the Max Planck or Fraunhofer Institutes: “Many millions go in and what kind of products come out? I think the results are modest. I would like more trust in private startups,” asks Rübsam. Germany currently has the most patents related to hydrogen, but hardly benefits from them. “We need to move more from the idea to the product and finally profit from our know-how. There is a lot of potential left untapped in Germany.”

Association with Innovation Agenda 2030

The head of the German Startup Association, Verena Pausder, poses several fundamental questions: “We should broaden our perspective and ask: Where do we want to take this country? We have all the ingredients for the future.” Her association is presenting an innovation agenda for 2030 in Berlin today. It states: “Germany can get involved in the latest innovations. We have world-class research on a par with the USA. But how much of this is put into practice and in products?”

The questions in Berlin are similar to those in Speyer. Verena Pausder will provide the answers with the agenda: “Capital is often lacking. But there is so much money in insurers and pension funds. They invest around 300 billion euros annually in pension funds and real estate. A smaller part of this should go to start-ups in this country in the future,” says the head of the association.

There is currently a financing gap of 30 billion euros per year in Germany. Pausder cites France as a positive example in this context. President Macron made the topic of startups a top priority there years ago. “With the ‘Plan Tibi’, France has succeeded in mobilizing capital pools for investment in venture capital funds – as a result, six billion has been made available for startups and innovation,” says Pausder.

In addition, there are also many structural obstacles in Germany: For example, startups are often unable to take part in public tenders. They are then forced to go straight to the USA, and with that the added value also disappears, explains Pausder. She cites a current example: The Munich startup Marvel Fusion is currently developing a climate-neutral nuclear fusion power plant and is now building its new research facility in the USA.

Another goal of Agenda 2030 is to attract international talent. To this end, income tax for foreign skilled workers is to be reduced for a certain period of time – this has been common practice in other European countries for many years, explains Pausder.

The agenda also calls for the visa process to finally be standardized and digitized in order to significantly accelerate the influx of experts. And: The state should rethink public procurement in the future. “Five percent of public contracts should be awarded to startups by the end of the decade,” Pausder hopes. “That is innovation policy at no cost.”

Nice notes for Federal Government

The reputation of the federal government has also suffered among founders this year: the average grade was a solid 4, after a mediocre 3.7 in the previous year, according to a survey by the digital association Bitkom. One in ten startups even rated the traffic light policy as “unsatisfactory”.

“The traffic light coalition must speed up the implementation of its startup promises from the coalition agreement,” demands Bitkom President Ralf Wintergerst. Reducing bureaucracy is particularly important. More than half also consider simplified access for startups to public contracts to be an important instrument.

But there are also bright spots: venture capital investments grew by twelve percent to just over 3.4 billion euros in the first half of 2024 compared to the same period last year. In previous years, they had fallen significantly, according to the auditing firm Ernst & Young.

Strategy consultant Thomas Prüver warns, however: “Despite the positive development in the amount of financing, there is still no sign of a general sigh of relief in the German startup scene.” Prüver is concerned that the number of small deals with less than ten million euros has plummeted: “It is quite alarming that it is apparently becoming increasingly difficult for very young startups to get fresh money.”