Technology

In the era of digitalisation, the German technology sector is of particular importance. The sector not only represents an important branch of the economy with more than EUR 230 b in annual turnover, one million jobs and almost 7% of total economic output. In the context of digitalisation, the sector is above all a central driver of innovation and has a significant impact on other sectors.

LAST UPDATE

28/09/2022

TYPE

Executive Summary

CONTRIBUTORS

Dr. Nicholas Hanser

Current Developments

The software sector as the industry's driving force

The German technology sector finds itself in an ambivalent market environment. The segments of the technology sector are increasingly developing in different directions. While software and services are fundamental growth drivers for the entire sector, sales in the hardware segment are increasingly stagnating.

Growth Rates

2020

+4.6%

2021

+5.2%

2022

+5.3%

Trends

Analytics and Artificial Intelligence

The interplay of connectivity and new network infrastructures is generating huge, additional volumes of data. Analytics and AI assist in leveraging data effectively.

Transactions

Our Sector Transactions

0

Highlight Transaction

Habyt GmbH x Homefully GmbH

Number of M&A transactions - DACH region, 2021 (as of August)

1055

Significant Transactions

SAP SE X Signavio GmbH (2021)

AppLovin Corporation X adjust GmbH (2021)

Future Trends

Internet of Things and the implementation of the 5G network enable futuristic business models such as autonomous driving, telemedicine and the control of machines over the internet. As early as 2020, around 750 m network-enabled devices will be in operation in Germany alone. In addition, subscription business models (as-a-Service) are a rapidly growing field. Cloud-based models open up new sources of revenue while at the same time improving margins.

People & Voices

Saxenhammer has in-depth technical and industry knowledge and can leverage a broad network of industry experts who have gained many years of transaction experience.

" M&A activity in the tech sector continues to boom. The clear growth driver is the high demand for further investments and the large amount of dry powder, especially on the private equity side. The German market is also increasingly becoming the focus of international investors, which further increases demand and thus expands multiples."

Nicholas Hanser

Partner | Head of Technology

Our View

The technology sector in Germany plays an immensely important role, especially in terms of its innovative strength. Many other industries benefit from the technological achievements and business models that emerge from the sector. The software segment in particular has huge growth potential. But the high-margin special hardware segment also has extremely attractive prospects. The German technology sector can be seen as an important success factor for overall economic development.

Sector Update

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