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How can IPOs be facilitated for start-ups in Germany?

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Dr Alexander Gaigl

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Oxera, in collaboration with Professor Christoph Kaserer, recently prepared a study for the German ministry of economics and energy (BMWi) on the topic ‘How can IPOs be facilitated for start-ups in Germany? International comparison and recommendations for action’.

In this study, the team led by Alexander Gaigl produced insights on capital markets, stock markets and initial public offerings (IPOs) in Germany, and specifically on how to facilitate German start-up IPOs. We show that, relative to the size of its economy, Germany’s capital market is small compared to other countries. Accounting for this, the number of IPOs is comparable with other countries.

Our study discusses structural causes for a different number of start-up IPOs in several countries as well as the legal framework for IPOs, including possibilities for public listing via special acquisition vehicles (SPACs). We conclude by deriving twelve concrete policy recommendations on how IPOs of start-ups could be facilitated in Germany, covering aspects like the pension system (that is instrumental for the size of the capital market), taxation, and various aspects on the regulation of shares and shareholding.

Our recommendations are designed to inform the new German government’s policy by providing concrete options on how to facilitate start-up IPOs in Germany.

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