Germany: The Gateway To Europe’s Innovation Market

Although Europe faced many challenges in its path towards becoming a world leader in technology and innovation, there are many strengths and opportunities in the continent as well.

A viable way to enter the European market would be through Germany. The largest economy in Europe has certain advantages that make the country a prime gateway to the European innovation market.

Germany has made significant investments in innovation

Financial investments in research projects within Germany – from both public and private sources – totaled more than 100 billion euros, which is over three percent of the country’s gross domestic product since 2019. These numbers placed Germany ahead of the European average in terms of spending on research.

In fact, Germany houses the largest research community in Europe, with nearly 25 per cent of all scientists in the European Union working in the country. German researchers are also involved in projects all over the globe.

Application-oriented research communities have invested billions of euros worth of research and development funds into their ventures. This has resulted in additional employment for many thousands of workers.

The German government also provides project-based funding for individual universities, or groups of universities, that are working in internationally competitive fields.

German companies have a strong tendency towards research and development

The European Innovation Scoreboard, an instrument used by the European Commission to track the innovative performance of various countries in Europe, puts Germany in a high place among leading innovators.

Only a few other countries in the region surpass Germany in this regard.

In 2020, the European Patent Office approved more than 20,000 applications from Germany – more than twice as much as the number of applications from France.

According to surveys conducted by the American Chamber of Commerce in Germany, more than 90 per cent of companies consider Germany’s research and development as good or very good. There is a strong presence of qualified scientists available for research and development, as well as a regulatory environment that supports R&D.

German companies are highly productive

German companies display high levels of productivity and output.

Manufacturing processes are highly automated in Germany. In 2019, over 300 industrial robots per 10,000 employees were in operation. In the same year, more than 20,000 industrial robots were deployed in total. These robots primarily serve clients in the electronics and automotive industries. Germany’s heavy use of robotics positions the country as the regional leader in industrial automation.

Germany also has exceptional performance in the logistics market. In 2020, the turnover for that market was 265 billion euros – giving Germany the dominant share of Europe’s logistics market.

Investors are confident in Germany’s performance

Many companies and investors place Germany among the top five countries in the European Union for conducting business.

Issues that call for urgent solutions such as digitalization, environmental protection, sustainability, and other developments have triggered many business opportunities as well as a fundamental process of transformation for German industries.

These transformations, which could greatly improve the position of the country, are being supported both by the new federal government and large funding programs.

Investments – in the form of 130 billion euros of funding – have already been agreed upon, and are likely to be increased in the near future. Highly advanced industries such as hydrogen, quantum technology, and artificial intelligence are the main beneficiaries of this funding.

Are you ready to invest in the gateway to the European innovation market?

With all of these developments in mind, forward-thinking entrepreneurs would do well to consider scaling in Germany. Scaler8 can provide a strong network of partners and mentors, as well as knowledge and experience with business and markets to help Asian startup companies maximize their potential.

Our Singapore-based services are supported by German Entrepreneurship, an innovation service provider with connections in Germany and Asia. We are also part of Singapore’s Global Innovation Alliance.

When you are ready to make your move into the European innovation market, contact us here.

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