Every second startup in Germany is an “AI startup”

How is the advance of AI affecting and within German startups? The Startup Monitor 2025 provides some interesting figures.

Not just a feeling, but backed up by numbers: One in two startups is doing something with AI. 45 percent of the founders surveyed by the Startup Association stated that AI is a "core component of their product." This is stated in the Startup Monitor published earlier this week.

More and more "AI startups" are being founded in Germany, and investors are riding the same wave: Dealroom data shows an investment volume of 2.1 billion euros to date – this is the amount of money invested in AI startups so far, and by the end of the year, this could reach three billion euros – a significant increase over the previous year.

So many new opportunities in all the new AI startups? Not really. The Startup Monitor also shows that the number of jobs in the startup ecosystem is declining. In 2023, the number of employees reached a peak: On average, German startups employed 18.9 people.

By 2024, this figure had already fallen to 16.7. By 2025, only 15.8 people would be working in a startup on average—a decline of 16.4 percent in just two years.

The authors of the Startup Monitor cite several possible reasons. For example, the fact that, in the wake of the hype of the COVID-19 years, heavily funded companies hired extremely large numbers of people during the "hypergrowth." That labor-intensive business models, such as delivery services, are no longer as attractive.

But one reason is also obvious: the so-called "efficiency gains through AI." Young, digitally savvy companies in particular seem to be able to use AI in such a way that personnel expenses and costs can be reduced.

This is also supported by a continued decline in planned new hires: In 2023, startups planned to hire an average of eight new employees per year, in 2024 only six, and this year only 4.8. "This also means that things are becoming more difficult for career starters in the startup sector," the report states.

A problem that has always been loudly complained about is thus becoming somewhat smaller: the shortage of skilled workers is easing. In small startups, almost eight percent fewer founders report that they are unable to find enough skilled workers. In larger companies with 50 or more employees, the use of AI makes an even greater difference: In 2024, 56 percent of respondents still stated that the shortage of skilled workers was a major or very major problem. By 2025, just under 37 percent saw it this way.