Borderstep Institute’s Green Startup Monitor 2021 once again took a closer look at the state of green startups in Germany. According to the report, 30% of all startups in the country can be classified as ‘green’. While it is proven that these companies play an important role in Germany’s startup ecosystem and are one of the main drivers of a green(er) economy, they are struggling to secure early-stage financing and competing with ‘traditional’ growth-only focused startups.
How can early-stage accelerator programs such as the High-Tech SeedLab contribute towards the promotion of green startups and impart the necessary knowledge for startups that are not green yet, to holistically integrate sustainability into their business?
Definition of ‘green startups’
Key results of the Green Startup Monitor 2021
The Green Startup Monitor 2021 aims to identify specific challenges and needs of green start-ups and recommend concrete measures to improve the startup and market environment for green start-ups in Germany. The yearly report, published by Borderstep Institute, lists nine main learnings when it comes to the state of green startups in Germany:
- German startups are becoming increasingly greener and more impact-oriented
- Green startups are more closely related to hardware
Green startups see themselves as more innovative
- The quota of female founders is higher in green startups, but stagnating
- Green startups are looking for more VC and better early-stage financing
- Only half of the green founding teams are interested in an exit
- The satisfaction of green startups with their regional ecosystem varies
- The difficulties with raising capital are getting worse
- Green startups are in favor if a ‘Sustainability’ funding line and more state VC funding
Helping startups become green(er)
While the number of green startups in Germany continues to grow, many ‘traditional’ startups out there are looking to become greener but lack the knowledge necessary to integrate sustainability into their business. This is why early-stage accelerator programs in Germany such as the High-Tech SeedLab provide concrete action items to help startups along their way of becoming (more) sustainable. At the same time, these programs can be a great starting point for green startups to tackle imminent challenges of entering the market.
The pillars of High-Tech SeedLab’s accelerator program include:
- Workshops on sustainability: We offer knowledge transfer around the topic of sustainability in our ‘Sustainability Week’. It’s a full week of sustainability-related topics such as ESG frameworks, impact measurement, defining and measuring the right sustainability KPI’s as well as communication around sustainability. This workshop series preps our participants with the right knowledge and skills to implement sustainability into their business early on.
- Connecting with green or socially responsible investors: Green startups are companies like any other: they need capital. Seeing more and more successful green startups within the German startup ecosystem, investors are interested in sustainability-related investment opportunities. Today, there are quite a few business angels as well as green VC’s out there who are explicitly looking to invest in green startups. We are actively connecting the teams of our cohort with investors suitable for them.
- Community of green startups: While not all of our portfolio companies are active within the field of sustainability, we are all about building a network and safe space to meet, connect and learn from each other. Our regular alumni events connect our current cohort with participants from previous years, aiming to find an answer to the ever burning question of how to tackle the challenges of building and growing a green business.
Further actions to support green startups
Promoting sustainability in startups at an early stage is a central key to a sustainable environment. Early-stage accelerator programs can contribute towards a greener startup ecosystem by providing the necessary toolkit and connections around the topic of sustainability for founders.
Apart from knowledge transfer and connecting green startups with suitable investors, what other actions can be taken to help both traditional and green startups become more sustainable and grow into successful businesses? Leave a comment.
The High-Tech SeedLab’s acceleration program is designed to help early-stage teams with a focus on sustainability and/or women in tech to test their idea and business model, build or finalise a minimum viable product, and successfully launch their business.