Germany Venture Capital Overview: Deal Activity Falls Off, Investment At $400M

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Germany has long been touted as the next big European tech hub. But after a blowout Q1’15, which saw over $1.2B raised across 70 deals (both multi-year highs), overall activity fell back down to earth in Q2’15. The absence of multiple mega-rounds and the second-lowest quarterly deal number since Q4’12 combined for a major pullback quarter where just $401M was raised across 45 deals. Q2’15’s largest deal was to Delivery Hero in the form of a $110M Series H, the only $100M+ round to a VC-backed German company in the quarter.

Q1’15, in contrast, was buoyed by mega-rounds to HelloFresh ($126M Series E) and to Delivery Hero (a $563M corporate minority investment). 

Berlin continues to dominate the German VC scene, accounting for over 40% of all investments to German VC-backed companies since 2012 and over 55% of all funding. Berlin hosts multiple high-flying German startups including Delivery Hero, Foodpanda, Soundcloud, and HelloFresh, among others. Rocket Internet — known for producing startups that clone successful American tech companies — is based in Berlin.

Munich is second for deal activity in Germany, with 87 deals sine 2012 raising nearly $527M. Munich is home to Westwing Home & Living as well as JenaValve Technology, which each have raised over $100M in cumulative funding.

Hamburg rounds out the top 3 with 44 investments into VC-backed companies since 2012, the bulk of which have gone to early-stage companies.

Delivery Hero leads all German VC-backed companies in total funding, having raised a whopping $1.33B thus far from investors including Holtzbrinck Ventures, Rocket Internet, German Startups Group, among others. Foodpanda, another Rocket Internet-backed company, has raised the second-most funding at $318M, while Kreditech rounds out the top 3 at $270M. Notably, 3 of the top 5 most well-funded German VC-backed are backed by feature Rocket Internet.

Another VC, Bonn-based High-Tech Gruenderfonds, is by far the most active in Germany, investing in over 100 companies since 2012, including Windel.ne which recently went public at a ~$533M valuation as well as 6wunderkinder which was acquired by Microsoft for ~$200M in June.

German Startups Group and IBB Beteiligungsgesellschaft rounded out the top 3.

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