The latest EY Startup Barometer Germany for 2025 confirms Berlin’s position as the country’s leading startup hub. Even in a challenging economic environment, the capital continues to stand out as the most dynamic innovation center in Germany. Key drivers of this performance are the city’s high level of financing activity, the large number of funded startups, and the broad distribution of invested capital.
Investment Volume: Berlin Leads Among Cities
In 2025, Berlin ranked first among Germany’s cities and second among the federal states in total investment volume, with €2.68 billion invested. This represents a 23 percent increase compared to the previous year and accounts for 32 percent of all venture capital invested in German startups. In other words, nearly one-third of all venture capital invested in German startups in 2025 was directed to Berlin-based startups.
Berlin’s Broad-Based Financing Structure
In 2025, a total of 218 financing rounds were completed by startups based in Berlin, clearly outpacing other German regions. Bavaria followed with 149 rounds, while North Rhine-Westphalia accounted for 97. The financing rounds were distributed across 207 Berlin-based startups, far more than the 139 in Bavaria and 93 in North Rhine-Westphalia.
This contrast highlights differing financing structures: whereas Bavaria’s funding landscape is shaped by a small number of very large financing rounds, Berlin’s investment volume is distributed more evenly across startups, with the largest single round in 2025 amounting to €240 million. This pattern is further reflected in the composition of major deals, as only two of Germany’s ten highest-funded startups in 2025 were based in Berlin (AMBOSS and n8n), while most were located in Bavaria. As a result, Berlin’s competitive advantage stems less from individual mega-deals, but rather from the depth and continuity of its startup landscape.
Sector Focus Within Germany
Berlin stands out particularly in digital and data-driven business models. In software and analytics, Berlin-based startups raised nearly €1 billion, on par with Bavaria. In artificial intelligence, Bavaria leads with €781 million compared to Berlin’s €584 million, yet Berlin remains one of Germany’s leading AI hubs. Berlin holds a clear leading position in FinTech and InsurTech, with startups raising €334 million, well ahead of Bavaria (€159 million).
Other regions build on their specific strengths, for example Baden-Württemberg with its strong hardware startup ecosystem.
In summary, the EY Startup Barometer underscores Berlin’s leading role in Germany’s startup ecosystem, characterized by a high number of financing rounds, broad capital distribution, and a resilient, innovation-driven structure despite economic challenges. Rather than relying on a few large deals, Berlin benefits from a dense and dynamic founder community across all development stages, with a strong focus on digital business models, particularly in FinTech and InsurTech.
If you would like to learn more about Germany’s startup landscape, you can download the latest EY Startup Barometer Germany here.