How hard the pandemic has hit founders

The crisis has put people off starting a business, and men in particular have shied away. Women, on the other hand, are more crisis-resistant and have adapted their business model. In addition, twice as many start-ups gave up than in 2019.

The coronavirus pandemic is costing Germany many start-ups: 68,000 fewer people started their own business in 2020 than in 2019, while the number of full-time start-ups fell by 12% to a record low. These are the results of the KfW Start-up Monitor for 2020. The outlook for 2021 is positive: the study assumes that start-ups that were postponed in 2020 will catch up and that the economic forecasts are positive.

According to the study, there were 537,000 start-ups in 2020. This corresponds to a start-up rate of 104 start-ups per 10,000 people aged 18-64, compared to 117 start-ups in 2019. The pandemic primarily deterred men from starting a business: 58,000 fewer of them started a business in 2020, while the number of women only fell by 10,000 start-ups. Women also reacted more quickly to the crisis: they made changes to their business model due to the coronavirus pandemic in 52% of cases, but only 39% of male founders adapted their business. In total, 38% of start-ups were founded by women.

Financially, it was primarily the founders themselves who raised the money: 55% of start-ups used their own funds, while external funds from investors were only used in 12% of cases.

Where the pandemic is particularly evident: The number of start-ups that were less than five years old that were aborted has doubled compared to 2019. The pandemic was cited as the reason for 56% of abortions, with inefficiency being the main reason given.