Investment in German startups continued to grow in the first half of the year, according to a new study. Over the past six months, young companies received almost €5.3 billion, consultancy firm EY reported on Wednesday. That marked a 14 percent increase compared with the same period last year, when startups raised around €4.6 billion in venture capital.
According to EY's current Startup Barometer, the most funding in the first half of the year went to startups based in Berlin. A total of nearly €1.7 billion was invested there, ten percent more than in the same period last year. Baden-Württemberg followed in second place with €1.6 billion in venture capital for startups, representing a massive increase of 475 percent. However, EY noted this was "primarily due to a mega-deal worth €1.2 billion" involving robotics specialist Neura Robotics.
Bavaria ranked third, with young companies there raising more than €1.1 billion in the first half of the year, a decline of 46 percent compared with the previous year. Hesse, Brandenburg and North Rhine-Westphalia rounded out the following places.
Venture capital invested in startups had already risen significantly in recent years. While it climbed again in the first half of 2026, the number of deals fell, according to EY. Nationwide, there were 354 completed deals, an 11 percent drop compared with the same period the previous year.
"The significant increase in invested capital is fundamentally a positive signal for the startup ecosystem in Germany," said EY expert Thomas Prüver. "However, it should not obscure the fact that the funding situation remains difficult for many young companies in this country," he added. Investors are increasingly focusing on a small number of large startups and "supposedly safe bets", as a result, young and small startups are "often losing out in the competition for capital."
This could have a negative impact in the medium term, Prüver explained: "Innovation doesn't just come from individual flagship companies, but above all from a broad and vibrant startup scene."
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