Start-ups and Germany’s ‘Mittelstand’ (SMEs): The Potential and the Challenges of Collaboration

In collaboration with their younger counterparts older firms can adopt new business models, jointly develop innovative products and potentially boost their own digitalisation processes. Thus could the decline in the growth potential of the German economy, largely put down to demographic factors but possibly also due to as yet hesitant digitalisation, be reversed. However, if this potential for cooperation is to be fully exploited, the cultural differences between the two types of company need to be overcome and new contacts between them facilitated despite their different regional concentrations. The present analysis uses the available studies and an econometric evaluation of a survey of Germany’s largest family-owned businesses conducted by the Federation of German Industries (BDI) to examine the level and intensity of cooperation. Further- more, Interviews with decision-makers from start-ups, SMEs and business associations identify opportunities for strengthening the cooperation between established SMEs and the growing start-up scene.