©iStock / alvarez
Venture capital and business angels: a range of funding options for businesses in North Rhine-Westphalia
Financial resources are one of the things innovative entrepreneurs need to make their ideas a reality. And venture capital investments in North Rhine-Westphalia start-ups are set to keep growing into 2022.
Technology and knowledge-based start-ups often need more capital in the start and growth phase. Alongside traditional loan financing, acquiring additional equity is an important factor for the success of these companies. Venture capital investments like this often provide access to investors’ network and know-how as well as the financing itself. The federal state aims to strengthen North Rhine-Westphalia’s status as a hotspot for venture capital and thereby a top location for technology and science start-ups.
The federal state already offers a range of financing options for start-ups and new businesses. With NRW.BANK, North Rhine-Westphalia has by far the most active state funding institute in Germany and provides a wide range of start-up and growth financing measures.
The state’s equity options in detail:
NRW.Venture enables young, fast-growing businesses in North Rhine-Westphalia to get up and running. On the website specially dedicated to start-ups you will find information and offers of support for innovative and often tech-oriented businesses that cannot self-finance through loans. Up to ten million euros of equity is invested per start-up over the course of several rounds of funding. This takes place in conjunction with private sector investors. In addition to financial support, the team at NRW.Venture and other investors also bring their expertise and network.
NRW.BANK win Business Angels Initiative
The win Business Angels Initiative of NRW.BANK (information in German only) brings business angels and innovative growth companies together to make private investments in promising start-ups.
The NRW.SeedCap programme (information in German only) doubles venture capital provided by business angels at the same conditions. NRW.BANK contributes up to 200,000 euros to the financing.
Regional start-up funds
Venture capital engagement at the regional level is also important. Venture capital funds such as the Gründerfonds Ruhr, Neoteq ventures Rheinland or the Aachener Tech Vision Fonds I offer a wide range of financing solutions. With a capital endowment of 30 to 40 million euros each, they set important trends in their region. In addition to providing equity capital, the regional funds provide strategic knowledge and an extensive network that brings together business angels, venture capital investors and entrepreneurs.
And the latest fund is:
During the ongoing pandemic, North Rhine-Westphalia has assumed a pioneering role in start-up support. As early as April 2020, the federal state government developed the NRW.Start-up akut programme in cooperation with NRW.BANK. It provides emergency funds to start-ups which are less than three years old to get through corona-related financial problems.
The NRW.Start-up akut programme (information in German only) is aimed at technology-oriented stock corporations in the seed or start-up phase which have been affected by the corona pandemic. NRW.BANK supports these businesses with federal and state funds with the aim of bridging financial bottlenecks. It provides up to 200,000 euro in the first round of funding and a further 300,000 euro (maximum) as part of a potential second round of funding.
Alongside the support offered by the federal state, North Rhine-Westphalia’s start-ups can access nationwide support too:
High-Tech Gründerfonds and Coparion
The two national venture capital funds High-Tech Gründerfonds and Coparion are based in North Rhine-Westphalia. Numerous private venture capital companies which can also be found on our start-up state map of North Rhine-Westphalia also provide support.
Business Angels Netzwerk Deutschland (German Business Angels Network)
The Business Angels Netzwerk Deutschland (German Business Angels Network) is a group of experts who can offer new forms of financing as well as classic venture capital funds to start-up founders.
INVEST – venture capital subsidy
The INVEST – venture capital subsidy is a scheme run by the German Ministry for Economic Affairs and Climate Action which bolsters investments by private investors, particularly business angels, in young innovative businesses with an acquisition subsidy in the amount of 20%.