Blockchain startups need more venture capital

Blockchain start-ups are young and small and need one thing above all: venture capital. According to a series of studies, however, this still fails too often.

275 start-ups in Germany are working with blockchain - in absolute terms, more than in any other country in the EU. But in relation to the working-age population, that's only 4.4 startups per 100,000 employees, again putting Germany far down the list. Estonia and Malta, for example, are particularly start-up-friendly. These are the results of a series of studies by the Institute of the German Economy (IW) based on the data provider Crunchbase.

According to the study, the majority of start-ups that integrate blockchain technology into their products are young and small. 70 percent are less than five years old, 60 percent have fewer than ten employees. "Many of the companies don't have finished products yet, only prototypes or beta versions," says study author Vera Demary. But she also sees movement in the startup industry, which is closely linked to the establishment of blockchain. "If you want to promote blockchain, you also have to promote startups," Vera Demary concludes.

According to the IW, the sluggish development in Germany is also due to the lack of venture capital: "When it comes to start-ups and venture capital, Germany should learn from Israel and Estonia in order not to lose out in this important technology," says IW financial market expert Markus Demary.