Study: Germany lags behind in university startups, missing opportunity for 13 million jobs and €5 trillion in economic output
A new study by AlpMomentum, Redstone, TU München and Universität Trier reveals Germany ranks in the lower middle of Europe for spinning out startups from universities, with just 9.7 per €100M budget, far behind leader Andorra. Scaling challenges and brain drain to the US are cited as key barriers.
A cross-European benchmarking study has laid bare Germany's weak performance in converting academic research into successful startups. The ‘Redstone University Startup Index’, compiled by think tank AlpMomentum, venture capital firm Redstone, the Technical University of Munich and the University of Trier, examined 1,000 universities and 50 public research institutions across 36 countries and regions over the past year. It found huge variation in efficiency: on average, institutions produce between 1 and 80 startups per €100 million of annual budget.
Where Germany stands
Germany managed just 9.7 startups per €100 million, placing it in the lower middle of the ranking. The country's 143 universities and 9 research institutes were evaluated. The top spot went to Andorra with 52.2 startups—though that figure is based on a single institution. The Baltic states and France also outperformed Germany significantly.
- Germany
- 9.7
- Andorra
- 52.2
Barriers to growth
Early-stage financing in Germany is decent thanks to public grants, but growth capital remains a stumbling block. Jörn Block, an economist at the University of Trier who co-authored the study, warned that founders often hit a wall after the initial phase.
If I know I can't grow here, I might decide not to start up at all or go elsewhere right away. Especially in biotech, many are moving to the USA.
Block contrasted Germany's landscape with the UK's more venture-friendly environment.
He cited Oxford and Cambridge as examples of universities that successfully embed innovation into teaching.Unlike in Germany, there are fewer giant research clusters like Fraunhofer, Helmholtz or Max Planck in the UK. Technological research is more integrated into university ecosystems, and that shortens the path to student founders.
The economic upside
The study also projected the enormous payoff if all institutions could match the performance of the top 10%—with a slight further improvement. Within ten years, Europe could see more than 445,000 additional startups, over 13 million new jobs, more than €5 trillion in extra economic output, over €9 trillion in additional enterprise value, and more than €1.5 trillion in extra tax revenues.
What could change
Redstone founder Michael Brehm noted that larger institutions tend to become less efficient at startup creation. Business schools, predictably, scored best. The analysis, based on LinkedIn profiles and the Dealroom database, suggests that smaller, better-integrated research bodies could outperform sprawling conglomerates. For Germany, that might mean rethinking how its massive research societies connect with students and the venture ecosystem.
