<p>Start-ups and entrepreneurial spirit in GermanyFacts and figures bmwi.de Current as of: July 2017Chapter overview Entrepreneurship in Germany: macroeconomic data New entrepreneurs: socio-demographic data New firms: business data Innovative start-ups: data and funding programmes Encouraging start-ups in Germany: institutions and programmes Links and addresses for further research/publication dataFederal Ministry for Economic Affairs and Energy | &nbsp;July 2017 &nbsp;| 2InformationPlease note:This factbook contains data on start-ups gathered from various surveys. Since the data base varies from source to source (IfM, KfW, Destatis), the figures are not comparable.Federal Ministry for Economic Affairs and Energy | &nbsp;July 2017 &nbsp;| 3Key facts at a glance 378,000 start-ups in commerce, the liberal professions and agriculture/ forestry (excl. sideline businesses) 282,400 start-ups in commerce (excl. sideline businesses) 249,900 start-ups in commerce as sidelinebusinesses 88,800 start-ups in the liberal professions More than one in ten start-ups are established based on inheritance, purchase, lease of company Potential for entrepreneurship particularly among women and migrantsReference: IfM Bonn 2017Federal Ministry for Economic Affairs and Energy | &nbsp;July 2017 &nbsp;| 4Start-ups in 2016 (in percent)74.723.51.8CommerceLiberalprofessionsAgriculture andforestryRegional distributionReference: KfW start-up survey 2017Federal Ministry for Economic Affairs and Energy | &nbsp;July 2017 &nbsp;| 5Hamburg the new start-up capitalNumber of people starting up in business per 10,000 gainfully active people (2014-2016 p.a.) Urban areas mean easy transport. This is an advantage in services and the retail/wholesale trade in particular. Hamburg is overtaking Berlin. In both Lnullder , entrepreneurial activity largely consists of freelance start-ups in the media and IT industry.Chapter overview Entrepreneurship in Germany: macroeconomic data New entrepreneurs: socio-demographic data New firms: business data Innovative start-ups: data and funding programmes Encouraging start-ups in Germany: institutions and programmes Links and addresses for further research/publication dataFederal Ministry for Economic Affairs and Energy | &nbsp;July 2017 &nbsp;| &nbsp;6Bundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;7 According to IfM Bonn, there were approx. 282,000 commercial start-ups in in 2016 around 16,200 or 5.4% fewer than in the preceding year. This marks the sixth decline since 2011. The approx. 282,000 start-ups compare with 311,000 liquidations. This means that the number of companies decreased by 29,000. In other words, more companies were closed down than started up. The fall in the number of company registrations is primarily thanks to the stable employment situation in Germany and the fact that fewer businesses are being set up by the unemployed.338310299 282354 348328311-16-38 -29 -29-100-500501001502002503003504002013 2014 2015 2016Start-ups Liquidations DifferenceNumber of newly registered businesses compared to liquidations(1,000)Reference: IfM Bonn; figures do not include sideline businesses and liberal professions, 2017Newly registered businesses and liquidationsBundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;8Sideline businesses: number of start-ups and closures In 2016, around 249,000 new sidelinebusinesses were registered, up 0.5% from 2015. According to IfM Bonn, 249,900 new sideline businesses were registered in 2016. The overall balance is +67,900 businesses. In other words, more sideline businesses are started up than closed down.249251249 250166173 179 182837869 680501001502002503002013 2014 2015 2016New sideline businessesSideline business liquidationsDifferenceNumber of newly registered sideline businesses compared to liquidations(1,000)Reference: IfM Bonn; the figures do not include sideline businesses and liberal professions, 2017Bundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;9Women under-represented in start-up figures In 2016, women registered 29.1% of new commercial sole proprietorships. This marks a slight increase from the 2015 figures (+0.4%). In terms of commercial sole proprietorships started as sidelinebusinesses, the proportion of registrations by women dropped slightly, slipping 0.6 percentage points to 42.1%. Share of start-up entrepreneursin the working age population in 2016Reference: IfM Bonn, 201729.170.9WomenMenBundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;10Germany is on the right trackThe Country Report for Germany, developed as part of the Global Entrepreneurship Monitor (GEM), states that Germany has a particularly good track record on the following key aspects for start-ups: Physical infrastructure Value that consumers attach to newProducts/services Public funding programmes Intellectual property rights (e.g. patents) Consultants and suppliers for businessesThe main challenges now are to improve training in entrepreneurship both inside and outside the classroom, to enhance policy commitment, and to reduce the burden of regulation and taxation.Sources: GEM Countrycrafts Report for Germany 2016Chapter overview Entrepreneurship in Germany: macroeconomic data New entrepreneurs: socio-demographic data New firms: business data Innovative start-ups: data and funding programmes Encouraging start-ups in Germany: Institutions and programmes Links and addresses for further research/publication dataFederal Ministry for Economic Affairs and Energy | &nbsp;July 2017 &nbsp;| &nbsp;11Bundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;12People of all ages become entrepreneurs The “baby boomers” are now aged between 45 and 54 years. They account for 26% of the population. In 2016, some 17% of new businesses were set up by people in this age group. Compared with 2015 (22%), the proportion of businesses set up by 45-54 year-olds dropped slightly. At the same time, the proportion set up by 18-24-year-olds (16% in 2015) and 25-34 year-olds (34% in 2015) rose slightly.Age groups in 2016 (in per cent)Comparison: population/new entrepreneursReference: KfW start-up survey 2017, tables and methods1218203619232617227Population Entrepreneurs55-64 years45-54 years35-44 years25-34 years18-24 yearsBundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;13Businesses set up by non-German nationals The share of businesses (commercial sole proprietorships) set up by foreign nationals is at its lowest level since 2012. The reasons for the fall include the introduction of full freedom of movement for Romanians and Bulgarians on 1 January 2014. The number of businesses set up by Bulgarians in 2016 dropped by 20.3% compared with the preceding year; businesses started by Romanians dropped 10.9%. Proportion of start-ups by foreign nationals in 2016 (in percent)20132016 comparison46.543.9 4442.5051015202530354045502013 2014 2015 2016Reference: IfM Bonn, the figures do not include German nationals with non-German roots, 2017Bundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;14Start-up activity highest in the skilled crafts and among non-graduates The proportion of start-ups set up by graduates has fallen slightly since 2015. Most start-ups are set up by entrepreneurs with a vocational qualification. Interesting fact: 58% of people stating a business were working as employees before setting up their own business. Proportion of start-ups by level of qualification(in percent)Reference: KfW start-up survey 20161623182024554850 474628 2931 322901020304050607080901002012 2013 2014 2015 2016No vocational qualification Vocational qualificationUniversity degreeBundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;15Most common reason for starting a business: turning a business idea into a commercial product/service The largest proportion of people (46%) setting up in business do so because they want to realise a business idea. Another important motive (for 25%) is a lack of alternative sources of income.Motives for new start-ups in 2016 (in percent)2925460 10 20 30 40 50 60Other reasonsLack of alternative sources of incomeRealising a business ideaReference: KfW start-up survey 2017, tables and methodsChapter overview Entrepreneurship in Germany: macroeconomic data New entrepreneurs: socio-demographic data New firms: business data Innovative start-ups: data and funding programmes Encouraging start-ups in Germany: Institutions and programmes Links and addresses for further research/publication dataFederal Ministry for Economic Affairs and Energy | &nbsp;July 2017 &nbsp;| &nbsp;16Bundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;17Most common type of new registration: new business Nearly 90% of all start-ups are new businesses. Around 74% of commercial start-ups were sole proprietorships. More than one in ten start-ups involve the takeover of an existing company (based on inheritance, purchase, lease).Forms of start-ups in 2016 (in per cent)8911New businessTakeoverReference: IfM Bonn, 2017Bundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;18Start-up sectors: mainly services and trade Services (personal, corporate, and financial) account for 68% of new businesses launched in Germany. The retail/wholesale sector is in second place (16%). The number of start-ups in the services sector has remained consistently high for years and reflects the general structural change taking place in our economy.Start-ups by sector in 2016(in per cent)533531634290 10 20 30 40Financial servicesOther goods-producing sectors andprimary-production sectorManufacturingConstructionTransport and communicationRetail tradeBusiness servicesPersonal servicesReference: KfW start-up survey 2017, tables and methodsBundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;19Most start-ups funded using entrepreneurs own financeUnemployment rates 20142016(in per cent)Reference: KfW start-up survey 2017, tables and methods658270102030405060708090100Entrepreneurs own finance Own finances and externalfinancingExternal financingEntrepreneurs own finance 9% of start-ups do not require material or financial assets. Half (50%) of start-ups require material and financial assets to launch the company. Entrepreneurs using external financing mainly turn to loans (bank loans, current account loans, promotional loans and loans from family and friends).Bundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;20Impact on employment from new start-ups The full-time equivalents of new start-ups correspond to the total of their individual weekly hours of work based on a 40-hour working week. Since people starting full-time businesses generally work longer, their contribution in terms of full-time equivalents is higher than the number of actual people. The opposite is true for sideline businesses. (Definition as per KfW start-up survey)Number of full-time-equivalent jobs (1,000)Reference: KfW start-up survey 2017Employee to new full-time founders New full-time foundersEmployee to new part-time foundersNew part-time foundersChapter overview Entrepreneurship in Germany: macroeconomic data New entrepreneurs: socio-demographic data New firms: business data Innovative start-ups: Data and funding programmes Encouraging start-ups in Germany: Institutions and programmes Links and addresses for further research/publication dataFederal Ministry for Economic Affairs and Energy | &nbsp;July 2017 &nbsp;| &nbsp;21Bundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;22New businesses spur innovation Around 15% of new entrepreneurs in Germany offer a product or service that can be described as a novelty on the regional, German, or international markets. These new products and services play an important role in strengthening the capacity to innovate across the entire economy. The vast majority of new entrepreneurs rely on tried-and tested business ideas.Innovations by start-ups in 2016(in per cent)85573Not a market noveltyNovelty on theregional marketNovelty on the entireGerman marketNovelty on theglobal marketReference: KfW start-up survey 2017, tables and methods The EXIST Start-up Culture helps higher education establishments to develop a holistic strategy for a culture of entrepreneurship and entrepreneurial spirit throughout the institution, and to implement this in a sustainable and visible manner. The EXIST Start-Up Grant provides support for students, graduates, and scientists during the preparatory stages of technology and science-based business ventures. The EXIST Research Transfer supports the development work necessary in order to demonstrate the technical viability of new research-based ideas for start-ups, and the preparations required for the business launch.Sources: foerderdatenbank.de; exist.deFederal Ministry for Economic Affairs and Energy | &nbsp;July 2017 &nbsp;| &nbsp;23EXIST Business start-ups in scienceGerman AcceleratorYoung innovative firms in the field of information and communication technology (ICT) and life sciences can use the German Accelerator to learn about the U.S. market. The following support is provided: Review of the business plan in terms of suitability for the U.S. market and further internationalisation (global benchmarking) Improved access to the technological and financial resources of the worlds leading IT and life sciences clusters Contact with experts and potential clients on the worlds leading IT and life sciences market Targeted mentoring by experienced entrepreneurs and investors Infrastructure, e.g. the provision of office spaceFederal Ministry for Economic Affairs and Energy | &nbsp;July 2017 &nbsp;| &nbsp;24Bundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;25High-tech Start-up Fund (HTGF) Venture capital for young, promising technology companies in all sectors Support from the HTGF management team Support for the technology companies up to the production of a prototype, proof of concept or market launch. First round of financing: up to 600,000 Possible follow-up financing of up to 1.4 millionHigh-tech Start-up Fund2005 to 2016: 577 companies funded 4,842 jobs createdBundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;26INVEST Grant for Venture Capital INVEST supports and encourages private investors particularly business angels to do more for young, innovative companies. Investor receives tax-free reimbursement of 20% of the total amount he invests in a start-up. This reduces the investors risk.INVEST Grant for Venture Capital (5/2013-12/2016) 2,741 applications by companies approved 2,777 applications by investors approved Grants of 42.1m approved 210.5m in venture capital mobilised for young, innovative companiesBundesministerium für Wirtschaft und Energie | &nbsp;Juli 2017 &nbsp;| &nbsp;27WIPANO Knowledge and Technology Transfer using Patents and StandardsWIPANO helps public-s</p>