Publication of the 7th German AI Startup Landscape.
The appliedAI Institute for Europe gGmbH presented the 7th edition of the German AI Startup Landscape, the most comprehensive analysis of the German AI startup ecosystem. dealcode AI has been recognized as one of the most promising startups in the sales sector in the German AI Startup Landscape 2024.
The New German AI Startup Landscape 2024 by AppliedAI Institute for Europe
Overall, there are 687 companies on the list, 35% more than last year, emphasizing the increased value of AI for the economy.
Deeper Insights About the German AI Startups Landscape Growth
Following last year’s trend, we again see a massive surge in the number of AI Startups in Germany. There are 687 startups on the German AI Startup Landscape 2024, representing a 35% growth compared to the previous year. While this overall growth rate is impressive, it is significantly below last year’s growth rate of 67%. From 508 AI startups in the 2023 AI Startup Landscape, 467 remain on the list and 220 new AI startups were added. Thus, the survival rate of AI Startups is extremely high compared to the survival rate of non-AI Startups. Out of 41 AI startups that are not represented on the German AI Startup Landscape 2024 anymore, 49% moved their headquarters outside of Germany, 17% were acquired, 10% are in liquidation, and 24% had to be removed as they were now older than 10 years. Noteworthy, almost all AI Startups that moved their headquarters outside of Germany established their new headquarters in the USA.
Growth Rate Observations
From our perspective, two things are worth mentioning regarding the AI Startup growth rate:
- Discrepancy in AI Startup Founding and Listing: Only AI Startups with a strong business model, a certain number of FTE, and internal AI competence are listed. Hence, there is a time lag between the founding of an AI Startup and its feature in the list, as only high-quality AI startups are listed.
- Decelerating Growth Rate: Although the growth rate is still high, it indicates a shift towards a more stable and sustainable growth pattern as the AI startup ecosystem matures and consolidates. The slower growth rate could also reflect a more cautious approach from investors.
Location Insights
As in the last editions, Berlin and Munich continue their domination in the AI Startup Landscape, accounting for approximately 50% of German AI startups. This year, Berlin again clearly dominates as the German city with the largest number of AI startups (209), while Munich ranks second (136 including the suburbs). Other cities like Hamburg (65), Karlsruhe (17), Stuttgart (16), Cologne (16), Darmstadt (16), Aachen (11), Düsseldorf (11), and Frankfurt (10) are also catching up with considerable growth numbers.
On a federal state level, Berlin (30.4%) again clearly dominates the AI Landscape in Germany, followed by Bavaria (23.3%), Baden-Württemberg (11.5%), North Rhine-Westphalia (10.2%), and Hamburg (9.6%). Five federal states account for approximately 85% of the German AI Startups.
Funding Insights
Approximately 38% of the AI Startups listed in the AI Startup Landscape 2024 received significant funding (> 1 million USD). The average amount of funding received is 17.1 million USD, whereas the median is 5.5 million USD. Notably, 80 AI startups received funding larger than 10 million USD, and 184 received funding between 1 and 10 million USD.
Industry Sector and Enterprise Functions
For AI Startups with a clear industrial focus, the key sectors are Cross-Industry, Human Health and Social Work Activities, Manufacturing, and Transportation, Mobility, & Storage. There has been a surge in AI Startups focusing on cross-industry and manufacturing, indicating a maturing state of AI solutions capable of addressing complex, real-world problems across diverse industries.
German AI startups are very active in areas like Operations, Production, Research & Development, Customer Service & Support, IT & Security, and Sales. The number of AI Startups in these areas has increased significantly, highlighting the growing potential to enhance efficiency, reduce costs, and improve quality control in various sectors.
Generative AI Insights
Generative AI is capable of generating new and unique content for various applications. These models are created by training a foundation model on large amounts of data and then fine-tuning it. Every fifth AI Startup in Germany is active in the field of generative AI, highlighting its rapid proliferation within the startup ecosystem.
However, German generative AI Startups attract limited funding. Excluding outliers, the remaining generative AI Startups attract approximately only 750,000 USD, indicating a significant gap compared to their US counterparts.
Conclusion
We are honored to be recognized in the 7th edition of the German AI Startup Landscape as a reflection of our dedication and innovation in the sales sector. As the German AI ecosystem continues to grow and mature, we are honored to be part of this dynamic community and contribute to the advancement of AI technology. This recognition motivates us to continue exploring the potential of AI in the sales industry. We look forward to further collaborations, innovations, and growth in the years to come.
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