German startups raise €1.7B in Q1 2026 as AI and foreign capital lead
German startups secured €1.7 billion in funding during the first three months of 2026. The figure marks a 6% rise compared to the same period last year, though it fell 15% from the previous quarter. Foreign investors played a major role, supplying over three-quarters of the total capital. AI-driven startups dominated the investment landscape, attracting 58% of the total funds. Healthcare and fintech firms followed closely, leading in deal volume. Early-stage companies raised around €726 million, while scale-ups brought in €714 million.
Unlike global trends, Germany’s venture capital market saw no 'megadeals' in this period. Instead, smaller transactions shaped the quarter’s activity. KfW, Germany’s state-owned development bank, recorded 32 exits, including 31 acquisitions and one buyout. U.S. investors contributed 34% of the total funding, reinforcing the strong international interest. However, Dirk Schumacher, chief economist at KfW, warned that higher interest rates could make fundraising harder in the coming months.
The first quarter of 2026 showed steady growth in Germany’s startup funding, despite a drop from late 2025. AI, healthcare, and fintech remained key sectors for investment. With foreign capital driving most deals, the market’s future will depend on economic conditions and investor confidence.
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