Technology + Software:

The technology sector has developed into an important pillar of the German economy and is an essential driver of growth and innovation in almost all industries. It encompasses a wide range of industries, including for example information and communication technology or the electrical industry.

Recent Developments and Trends

The software industry is an important growth driver in the technology sector. In Germany alone, the market volume in 2022 was an estimated EUR 32 billion, an increase of around 18% compared to 2020.1 The positive development depends significantly on both structural, cross-industry megatrends, such as digitalisation and sustainability, as well as industry-specific trends that have developed in the recent past. These include, in particular, topics such as artificial intelligence (AI), cloud computing, Internet of Things (IoT) or software as a service (SaaS).

Investors

The enormous growth and the outstanding economic importance of the industry ensure a correspondingly high level of M&A activity in the technology & software sector, with strategic and financial investors equally in focus. Strategists use acquisitions to strengthen their market position in the face of continuously increasing competition or to internalise know-how. For financial investors, technology and software companies are particularly attractive due to high growth rates and the scalability of business models (e.g. SaaS).

Evaluation

The unbroken high demand from investors continues to ensure a seller-friendly market with persistently high company valuations, even though the highs from 2021 are currently behind us.