• Start-ups raised EUR 1.7 billion in the first quarter
• International investors are playing a larger role again
• Artificial intelligence is gaining in importance, but not as much as in other countries

Despite major economic and geopolitical uncertainties, the German venture capital market started the year 2026 on a solid footing. German start-ups raised EUR 1.7 billion in the first quarter, six per cent more than in the first quarter of 2025. The investment volume was not driven by individual mega deals but resulted from a steady development across the broad market.

In the first quarter, international investors played a larger role again in the funding of German start-ups than in previous quarters. More than three fourths of the funds invested came from abroad, compared with around two thirds in each of the two previous quarters. Investors from the US were the most important source of capital for German start-ups, accounting for 34 per cent of the funds invested.

These are the findings of the KfW Venture Capital Dashboard, in which KfW Research publishes quarterly data on the German venture capital (VC) market.

“Given the ongoing trade and geopolitical risks, the consistently high interest in German start-ups from abroad cannot be taken for granted. The strong participation from abroad reflects both the continuing generally high investment activity by US investors and the trust which international capital providers continue to place in Germany as a technology and start-up location,” said Dr Dirk Schumacher, Chief Economist of KfW.

Most of the deals in Germany – 18 per cent – were closed by start-ups in the healthcare sector, followed by fintechs with just under 15 per cent. In line with the trend all around the world, the share of start-ups with a focus on artificial intelligence (AI) remained high in all economic sectors. German start-ups that focus on AI-based applications raised EUR 967 million in 71 funding rounds in the first quarter. With a share of 58 per cent in total market volume, the share of AI in the first quarter clearly exceeded the average of 43 per cent for the year 2025 as a whole.

But the positive development cannot obscure the fact that young AI enterprises currently appear to have a funding advantage in other VC markets. In the US, four market leaders in the field of AI together raised USD 188 billion in the first quarter. In the UK and France, too, individual AI start-ups struck deals in the billions.

“The global market environment remains difficult. Rising interest rates could pose new challenges for the VC market in the medium term. Higher interest rates make it more difficult for venture capital investors to raise capital. We do not expect any significant increase in investments across the broad German VC market in the coming months,”

said Dr Dirk Schumacher, Chief Economist of KfW.

The current KfW Venture Capital Dashboard by KfW Research can be found at: Venture capital market in Germany | KfW.´