The GmbH will often be the most suitable form for the startup itself, being an operative entity and (still) enjoying a higher reputation in the business world. Many startups also need more funds than EUR 25,000.00 anyway, even in the bootstrapping phase, so the GmbH can be founded right away. Even if the startup does not need this amount (simplified: share capital does not mean that the money may not be spent, it generally may simply not flow back to the shareholders), the financial burdens can be reduced during the incorporation: the share capital of the GmbH does not have to be paid-in in full when the company is founded. Thus, the hurdles to incorporating a GmbH are not necessarily as high as they seem at first glance.
The cost advantage that a UG may have over a GmbH when it is incorporated using the so called "simplified procedure" (Musterprotokoll) is rather limited. In addition, for many startups incorporation using the simplified procedure is not an option anyway because they are more than three founders, they want to install more than one managing director or need to include individual regulations in the founding deed and/or the company's articles of association (e.g., representation regulations that deviate from the law; regulations on the alienability of business shares; contribution of civil law partnership interests in a GbR, etc.).
Even if a UG is only rarely used as legal form for the startup itself in light of the above considerations, the UG is recommended to be used as the legal form for the establishment of the so-called "founder holding entities" due to the simplified incorporation process and reduced capital requirements.