Must strengthen role of start-ups in decarbonising Germany’s economy – association

Germany should make the most of its start-ups in its efforts to reach climate targets and strengthen the country as a business location, said the German Startups Association in a paper with proposals for the years until 2030. As the “motor of economic transformation”, start-ups played an important role, especially on climate technologies, the association said. It wants to see the number of so-called unicorns (privately held start-up companies with a valuation exceeding $1 billion) in the climate sector in Germany double by 2030 from the current six. Germany should also boast a leading venture capital provider for climate technologies and one of the world's top three universities in the field of climate innovation, the association said.

“We now have the opportunity to add a new, forward-looking chapter to the ‘Made in Germany’ success story with pioneering climate technologies,” said the association’s CEO Verena Pausder. The association developed its “Innovation Agenda 2030” with proposals on what is needed to make the most of the available capital for Germany’s growth and innovation, and which key technologies to focus on. It also proposes tackling skills shortages – for example through better visa rules and processes, and the introduction of  English as an official second language – as well as to ensure that the necessary financing is available. It proposes to triple venture capital investments to one percent of GDP by 2030.

About 30 percent of start-ups in Germany currently address the climate crisis, but only about one fifth of venture capital goes to climate tech start-ups, said the association. Many start-ups in the country take advantage of the transformation by bringing novel business ideas to market, and take market share from incumbents in sectors such as renewables, heating, industry, and mobility. The green start-up scene is so lively the country has been dubbed a "Green Energy Valley".