Business 4 min read By Callum Montgomery
Thiel says Germany's 'fear of success' holds back global scale-ups
Peter Thiel argues that German entrepreneurs are too quick to sell successful companies rather than scale them globally, as the UK overtakes Germany on the Fortune 500 Europe list and German automakers struggle.
Germany's entrepreneurial culture suffers from a «fear of success» that prevents founders from building the kind of global giants created by Elon Musk or Mark Zuckerberg, billionaire investor Peter Thiel has said. Speaking on the MDMEETS podcast to fellow German billionaire Mathias Döpfner, Thiel argued that the country's risk aversion is only part of the problem. «If you have something that works—you're not going to scale it to this extreme degree like an Elon Musk or Mark Zuckerberg,» he said. Instead, German entrepreneurs are more likely to sell or exit their companies before they become truly global businesses.
Thiel's comments come as the UK overtook Germany for the first time in the four-year history of the Fortune 500 Europe list, with 76 British companies compared with 73 German ones. He described the shift as part of a broader problem facing his birth country, noting that «what's very striking is how few great new companies have been built in Germany in the last number of decades.» Germany has a fraction of the unicorns found in the US and China, and its innovation performance now lags behind several European neighbours. In the European Union's 2026 Innovation Scoreboard, Germany ranked tenth, behind Austria, Luxembourg and Ireland.
Thiel, who was born in Frankfurt in 1967 and moved to the US as a one-year-old, built his reputation as a co-founder of PayPal and Palantir and an early outside investor in Facebook. His net worth is estimated at $37.2 billion. He pointed to stark differences in how wealth is accumulated among the richest people in the US and Germany. Among the 50 wealthiest Americans, he estimated about a dozen are Gen X or younger, and most built their fortunes themselves. In Germany, he counted roughly 20 people in that age group, all of whom inherited their wealth. «Not a single person did something new, made some new money, built a large new scalable company,» he said. «For each of those people [in the US], they created thousands of millionaires in their companies, tens of thousands of other jobs, they added to the economy in lots of different ways.»
The warning lands as Germany's traditional industrial engine shows signs of strain. For decades the automobile industry was a cornerstone of the country's economic success, with Volkswagen long ranking as Europe's largest company by revenue. The 89-year-old automaker reached its highest position on the Fortune Global 500 in 2017, ranking sixth with revenue surpassing Shell, Berkshire Hathaway and Apple. It now sits at 13th.
Volkswagen has faced fallout from its emissions scandal and mounting competition from Chinese automakers as the global industry shifts toward electric vehicles. Earlier this month it adopted a major restructuring plan that includes cutting the number of models it offers by roughly half and reducing its workforce by 50,000 positions, on top of roughly 50,000 cuts already agreed over the past two years. The company's stock is down more than 35% year to date.
Fellow German auto giants BMW and Mercedes-Benz, ranked 50th and 51st on the Global 500 respectively, have also seen their shares fall more than 20% over the past year, adding to concerns about the country's economic competitiveness. Thiel's critique suggests that without a cultural shift toward scaling and company-building, Germany risks falling further behind in the industries that will define the next decade.
4
