Europe's biggest economy is losing more companies than it creates. Whether through acquisition, attrition or just plain bad management, German entrepreneurs are not doing enough to replenish the corporate landscape. BTW: The average German start-up is 2.7 years old.
Of the companies that are launched, very few offer the world – or even the neighborhood – anything new. Analysts have long complained of Germany's inability to launch a breakout start-up, like the now-mighty SAP.
Learning from Failure
When faced with failure, most German entrepreneurs would pull themselves back up, dust themselves off and try again – the school of hard knocks. Impressive considering the country's conservative bent and a fear of failure that discourages entrepreneurship in the first place.
Germany's start-up rate, defined as the number of 18 to 64 year-olds that have founded a company or are working to become self-employed, is appalling. Getting beat by the US or even Israel? Sure. But Canada, the UK and Chile? Really?
It comes as little surprise that IT-based companies are the most popular start-up ventures, even in Germany.
Safer in Pairs
German entrepreneurs prefer to spread the risk, either with a partner or a bunch of partners. More than four, however, becomes a crowd.
Sources: KPMG, IfM Bonn, Economy and Energy Ministry, German Start-up Association, Duisburg-Essen University, KfW, Global Entrepreneurship Monitor