Sifted - Germany's fastest-growing startups

Good morning there,

We’re just 24 hours away from the start of this year’s Sifted Summit, our annual shindig bringing together the best of European tech for two days of panel conversations, intimate roundtables and heaps of networking. Founders, operators, investors, you can get yourself a last minute ticket here.  

Elsewhere, we’ve ranked the 50 fastest-growing startups in Germany in our newest Sifted Leaderboard. The list leaves few stones unturned — on there, you’ll find startups that are helping companies issue digital receipts and other useful things. You’ll also discover the company that uses AI to determine the sex of chicks before they hatch and a would-be SpaceX competitor that’s building a reusable rocket.

Elsewhere today:

• AI robots for warehouses: UK-based Dexory raises $80m to scale autonomous tech in the US
• Plural backs Oriole Networks in £17.5m round to develop tech to train LLMs 100 times faster

— Éanna Kelly, contributing editor

/A message from our sponsor Infobip

🦾 Autonomous robot startup Dexory has raised an $80m Series B round as it looks to expand in the US. The UK-based company is building autonomous robots for warehouses, and launched a commercial product in March last year after developing its tech for eight years. 

• The round was made up of 70% equity and 30% debt, and takes the startup’s total equity funding to $120m.
• DTCP, which spun out of Deutsche Telekom, led the round, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, alongside existing investors Atomico, Lakestar and Capnamic. DTCP partner Michael Rager joined Dexory’s board of directors.

🇬🇧 UK-based Oriole Networks, which says it has developed novel technology to help train AI faster, has raised £17.5m in a Series A round, according to Companies House filings. 

• Ian Hogarth, partner at London-based VC firm Plural, was appointed as a director of the company the same day in August as new shares were issued, indicating that the investor was involved in the round. 
• Oriole Networks and Plural did not respond to a request for comment.

🇬🇧 Newcleo, Europe’s best-funded nuclear energy startup, has raised a further €48m as it continues its mission to close a €1bn round. Since announcing it was setting out to raise the sum 18 months ago, it’s closed just €135m — which includes an €87m raise in May. The company, which is Europe’s only nuclear unicorn, also announced the relocation of its HQ from London to France, confirming Sifted reporting from August. 

• Investors in the round include Italian pension fund Inarcassa, Italian industrial plant equipment manufacturer Walter Tosto and French engineering consultancy Ingérop. Family offices and individual investors were also involved.

🇩🇪 One-time unicorn SellerX, a Berlin-based Amazon aggregator startup, has reached an agreement with its lenders and shareholders to reduce the leverage on its balance sheet, after one of its creditors put the company up for auction.   

• SellerX creditor BlackRock had marked the loan with non-accrual status in August, meaning the company had stopped making repayments on its debt. BlackRock and another creditor, Victory Park Capital, then set a date for the company to be auctioned off — but this agreement prevents a sale.

🇦🇹 Austria’s far-right Freedom Party (FPÖ) came first in the country’s election on Sunday — and local investors that Sifted has spoken to have mixed feelings. The pro-Kremlin, anti-Islam and anti-immigration FPÖ won 29.2% of votes, according to provisional results. The party will have to form a coalition with other parties to govern, but it’s likely to take a lead in forming new conservative policies. 

• “Just from the point of view of the investors, this is a good situation for us,” says Niki Futter, the president of Invest Austria, a trade body. “They don't want to raise taxes. They want to ease certain things in the economic sphere […] Both right parties [the FPÖ and the runner up People’s Party, the centre-right incumbent] are in favour of tax incentives for investors,” he adds. 
• On immigration issues, Andreas Riegler, founder and general partner of the deeptech VC fund Apex, adds that “there’s always the hope that even those parties that are pushing against immigration see a difference between controlled legal immigration and other immigration.
• “There's broad recognition that we do need talented people […] that we remain a very attractive location for top talent,” he adds. “There's obviously always some uncertainty with a new government.”
• Lisa-Marie Fassl, managing partner at Fund F by Female Founders, says: “Personally, I'm quite troubled to see the shift towards the right in Austria. It's frustrating to see that people think that the only hope to see tangible change in our country is to go for extremes. On the level of overall startup policies, I don't think that we're going to see significant impact—whether positive or negative. I think we're gonna have the same ‘stillstand’ that we've been used to for so long and which we can't afford from an economic and societal perspective.
• “What I'm worried about is that climate tech and impact probably won't be a big priority for the new government; same for increasing gender diversity, as the FPÖ is not necessarily known for caring about these topics," she adds. 
• A similar result in regional elections in neighbouring Germany — where the ultra right-wing Alternative Für Deutschland (AfD) came out on top in recent elections in the eastern state of Thuringia, and second in Saxony — rattled startup founders there, who are worried about the party’s plans to curb immigration and its lack of interest towards tech and entrepreneurship.

🇮🇹 Milan, Italy-based MITO Technology has announced the first close of its second fund, at €55m, which will focus on climate hardware and scientist founders. The European Investment Fund and CDP Venture Capital are among its LPs. 

• The firm says the fund is the first Italian VC fund classified as an Article 9 fund under the EU’s sustainable finance disclosure regulation. 
• It plans to make 25 investments into companies working on reducing carbon dioxide emissions in the energy, construction, mobility and heavy industry sectors. The fund has a target size of €90m and a hard cap of €120m.  

🇩🇪 German AI translation unicorn DeepL has appointed Sebastian Enderlein, who has cloud management and engineering experience at Uber, Salesforce and Personio, as its new chief technology officer. It has also hired Steve Rotter, who has more than 20 years of marketing experience with stints at Adobe, Motorola, FourKites, OutSystems and Acrolinx, as its new chief marketing officer.

🇵🇱 More than 700 Polish AI scientists, enthusiasts and founders have sent a petition to the Polish government asking it to explain its decision to appoint a new head of IDEAS NCBR, a governmental AI research and development centre, and to potentially reconsider its decision. The signatories include Bartek Pucek, the cofounder of Proofs and Aureliusz Górski, founder of Campus AI.

• Last week, the institution announced that Grzegorz Borowik, a professor from the state-owned Research and Academic Computer Network and a dean at Warsaw’s Helena Chodkowska University of Technology and Economics, had been chosen by its supervisory board to become its new CEO. In the process, he beat the current CEO, Piotr Sankowski, a computer science professor at the University of Warsaw who was declared by Stanford to be in the top 2% of AI researchers globally. Over his tenure, Sankowski managed to attract some of the world’s best AI experts — such as Aleksander Mądry, member of the technical staff at Open AI, and Marcin Żukowski, cofounder of Snowflake — to join the board of IDEAS NCBR. 
• After the decision to replace Sankowski was made, six board members of IDEAS NCBR resigned, including scholars from MIT and Open AI. 
• “The change in management, especially without real substantive justification, will result in a missed opportunity for this institution, will inhibit the development of AI research in Poland and will discourage many of the best scientists considering Poland as a place for their research and implementation work,” the petition says.

German tech: “painkillers or vitamins”

Germany’s tech folk aren’t asking for a lot. A lunch table at Berlin’s Klub Kitchen — “the chokehold that place has on VCs is absolutely insane to me,” says Berlin-based investor Amelie Bahr — and a juicy-but-not-obscene payday ought to do it. “If a German founder can make €20m from selling their company, they’re happy for the rest of their lives,” according to Boris Radke, chief commercial officer of solar energy company Enpal. Few, it seems, are ravenous to become billionaires. “The mentality here is not the US one,” Radke adds. 

But if you want to make German techies really happy, you’d probably do something about the lashings of red tape they regularly face. The requirement to have run-of-the-mill stuff like a change of office address handled by a notary drives plenty of people crazy. Faced with such finicky obligations, one beleaguered founder tells us: “I feel like I’m building a metalworking factory in the 1800s.” 

You'll find more healthy venting over bureaucracy in our newest leaderboard report, published today, which ranks the 50 fastest-growing companies in Germany by revenue. Annoying paperwork hasn't stopped the country from building a tech power that jockeys with France for second best in Europe (the UK remains the horse to beat). Germany hosts some major tech hubs and — in contrast to most other European countries, where basically everything happens in the capital — many minor ones too (our report examines Munich's claim on becoming Europe’s prime deeptech destination). 

German startups are emerging from a downturn like “the first spring flowers pushing through the snow,” says Jan Dzulko, founder and CEO of Everphone, which rents phones, tablets and laptops to businesses. But there’s a cold fog rolling over the wider economy. The all-important car industry is struggling to compete with Chinese electric vehicles and this is a huge drag on everything else. The economy is expected to shrink again in 2024. 

Companies are either “painkillers or vitamins”, says Dzulko. Everphone, which features in our top 50, is the former, he argues, because it helps offices to cut electronics costs. “But if you’re ‘a vitamin’ in Germany right now, it’s a problem: recessions are vitamin killers. When companies start cutting back, suddenly out go the office fruit baskets and mental health support apps.”

The companies on our leaderboard are a lively mix of both; they've all known hard times and may do so again soon. Somehow, through double-digit inflation and sharply rising interest rates, they’ve managed to grow (some rapidly).

Topping our leaderboard is Finn, the car subscription company, which has become a popular choice for people who are keen to try electric vehicles and other new models without committing big cash upfront. 

Cofounder and CEO Maximilian Wühr has some great business advice for anyone who wants to follow in his footsteps: listen to your mother. “We received a four-star review from her once,” says Wühr. “She knocked a star off because it took too long to reach one of our customer care operators. I appreciated that feedback.”

For the full ranking and insights into how they’ve grown so fast, click here.

— Éanna Kelly, contributing editor

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🇩🇪 Germany's fastest-growing startups by revenue.

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👀 Meet 11 early-stage founders currently scaling their innovations. (Sponsored by Morgan Stanley)

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Paris-based Lockall, which provides storage solutions for both individuals and businesses, raised €155m in funding. Starwood Capital Group led the round.

London-based Carmoola, which provides car financing solutions, raised £100m in debt funding from NatWest.

Vilnius-based Ovoko, an online marketplace to find, purchase and sell used automobile parts, raised €20m in Series B funding. Smash Capital led the round. 

Berlin-based Atlas Metrics, a platform for ESG compliance and sustainability performance management, raised €12.2m in Series A funding. MMC Ventures led the round and was joined by investors including b2ventures, Cherry Ventures and Redstone.

Brest, France-based Bluefins, which decarbonises ocean shipping with whale-inspired propulsion systems, raised €4m in funding from investors including GTT and BNP Paribas.

Cologne, Germany-based Foodforecast, which uses AI to enable stores to automate ordering and production processes and reduce food waste, raised €3m in funding. Scalehouse Capital and Future Food Fund led the round and were joined by investors including Blue Horizon Ventures and Aeronaut Invest.

Paris-based Luniwave, which enables hotels to reduce their water consumption by using a gameified shower device, raised €1m in funding from investors including Campus Fund, Climate Point, Inovexus, Insavalor, Side Angels, Super Capital and Bpifrance.

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