Austria’s defeat in the Seven Weeks War actually lead to the formation of Austria-Hungry, as Austria alone had declined in power and was no longer the principal German nation. The German Confederation was dissolved, and Prussia annexed the territories of Bavaria, Hanover , Holstein, Schleswig, Nassau, and Frankfurt, parts of Hesse-Darmstadt, and also Hesse-Kassel. Italy had taken part in the war on Prussia’s side and annexed Venetia.
This lead to the Formation of the North German Confederation. Prussia began to rise as a major power, in which in came to defeat France in the Franco-Prussia war in 1870–1871 and annexed Alsace -Lorraine, in which following this, Germany was unified, with Wilhelm I as Emperor of Germany. And after this, Germany would become one of the key players that lead to the First World War in 1914.