Germany’s Aim is “The Best Start-up Ecosystem in Europe”

Thomas Jarzombek is the German Commissioner for the Digital Industry and Start-ups and the Government Coordinator of German Aerospace Policy. It’s a combination that says a lot about the directions Germany wants to take in the coming years, and we got the chance to ask some questions about the country’s future strategies.
August 2021

Germany has historically not been known for start-ups, but this seems to be changing. Why is that?

Jarzombek: I think you’re totally wrong because so many things have been invented in Germany. The first car was built in Germany more than a hundred years ago. But you’re right that afterwards we were more successful in evolution than in disruption. We have a very strong economy and corporate players, for instance, when it comes to building cars, to machines and chemicals and so on. Maybe this is the reason Germany wasn’t as focused on digital or tech start-ups as other parts of the world. But fifteen years ago we came up with a strategy. We wanted to attract founders in the tech ecosystem here. And I think we’re quite good in the meantime. We’re spending around 20 billion euros in government money to invest in start-ups, and we have really good engineers. Our aim is to foster the best start-up ecosystem in Europe.

The €20 billion refers to the Future Fund. Could you tell us about that? Can international companies that set up shop in Germany access that money as well?

Absolutely. When we talk about the Future Fund, it consists of ten different modules. We have one very large pillar that’s going to invest as a limited partner in VC funds. These have to be European VC funds, and they have to invest German or European companies, but in the end, if you have a viable part of your start-up here in Germany, you’re fine for accessing this money. We also have direct investment tools like the High-Tech-Gründer-Fond, which is very successful. It’s in the fourth funding round with 900 million euros. And we’re starting with our new Deep Tech Fund with one billion euros. The aim is to invest in tech companies that don’t have a concrete business case right now. We want to partner with them for a long period of time, 10 to 20 years, so further on we have modules in this Future Fund. There are huge opportunities for international people coming here and founding a company and even for international start-ups to come here and build up subsidiaries in Germany.

You’re also Germany’s point man on aerospace. Is the German aerospace sector more focused on airplanes or future oriented things like drones, drone infrastructure and the like?

We’re doing both. If you look at the most successful airplane in the world, the Airbus single-aisle A 320 series, most of them are completed here in Germany. We’re a center of expertise for single-aisle and have been successful in this for a very long time. We have more than 100,000 people here constructing planes. On the other side, we’re focusing very much on new technologies, for instance, drones. We have a drone strategy. And we support drone companies with several programs from the Ministry for Economic Affairs and the Ministry of Transportation. We’re also focusing very much on eVTOLs, flight taxis. We believe this will be a huge market in the future. We have at least two players who are quite big globally: Volocopter and Lilium. They have strong funding, and we believe that this is also a future technology. We don’t focus on a single one. We focus on the technologies that are quite mature and successful. And for the future. Therefore, we are also aiming to build an electric plane by the mid-2030s. We believe this is realistic, and we’ve invested in a lot of companies to make that happen.

Thomas Jarzombek © BMWi/Tobias Koch

You’ve been adamant that Germany needs a location of its own to launch satellites into space. Why is that?

TJ: We see an era starting right now in which more satellites are being launched than ever before in history. They getting even more and more and more. We can build a start-up to send up lots of tiny satellites and do fantastic things with that. So we’ve focused very much on launch vehicles over the past few years. We held a competition for launch companies, and a private start-up, Isar Aerospace won a tender, so we’ll launch at least two satellites with them. And there are further start-ups upcoming. We want to create and build up a new space launcher business right here. We also have the debate about spaceports in Europe. I don’t believe it’s necessary to have a spaceport specifically in Germany. If there’s an opportunity, we’re open for it, that’s true. But on the other hand, if we start from Norway, Sweden, Portugal or the UK, we’re open-minded about that. I believe that to be quick and agile, it’s important to be able to start somewhere near Europe.

Back to start-ups generally, which sectors do you think could be interesting for international companies expanding to Germany?

We’re not focused on a single technology. We’re agnostic on that. I believe in a portfolio approach. Nobody knows what will be successful in 10 or 20 years, what it will be possible to create, or where it will be possible to get costs down and make new technologies accessible for a broad audience. Therefore, our aim is to focus on as many new technologies as possible. I believe our advantage here in Germany is that we are very good engineers. We have a lot of talented people, and they are very loyal. They’re not switching from one start-up to the next every six weeks. I think this is a huge advantage. We’re also supporting start-ups with a lot of financial investments in the whole ecosystem. So I believe we are a strong place for creating technologies.

Give us your one-minute elevator pitch to someone who’s thinking of investing money somewhere in Europe. Why Germany?

TJ: Come to Germany because we’re the world’s tech place. We invented the automobile. We’re very good at building big machines, and we’re now pretty good at building start-ups. We’re a very talented people. We have a good environment and infrastructure. And it’s a good place for you and your family to live. We have good social systems. It’s safe. We have freedom of speech and democracy and, I believe, some very nice and good-looking places here for you to spend your time.

Interview: Jefferson Chase