LfA Förderbank Bayern and the European Investment Fund (EIF) are expanding their joint funding The Bavarian government has allocated €120 million for startups. The goal is to provide young, innovative companies in Bavaria with better access to capital. By increasing the so-called LfA-EIF facilities, the total funding volume grows to approximately €445 million. The new funds will flow into technology-oriented startups via venture capital funds and are part of the "VC4Start-ups Bayern" initiative.
How the funding works
The collaboration between LfA and EIF has been in place since 2009. At that time, a fund-of-funds system was established, comprised of resources from both partners and managed by the EIF. These funds do not invest directly in startups, but rather in venture capital funds active in Bavaria. In this way, capital reaches technology-oriented, high-growth companies in their early stages of development.
To date, the LfA-EIF facilities have participated in approximately 60 venture capital funds. These funds, in turn, have invested around €1.7 billion in Bavarian startups. This latest increase will expand the resources available for new investments, providing young companies in their crucial growth phase with better access to financing.
Markus Schillo, Senior Regional Representative of the EIF in Germany, emphasizes:
“We are delighted that the successful collaboration between EIF and LfA continues. Bavaria is one of the leading lighthouse regions in Europe when it comes to promising startups. With our commitment, we are helping even more of them to achieve a breakthrough.”
Green light for Bavaria's startup scene
Capital is needed to accelerate product development, team growth, or expansion. However, traditional bank loans are often difficult to obtain, especially in the initial phase. Therefore, the provision of venture capital is often crucial for startups and, in the medium term, also contributes to the region's innovative strength.
Hubert Aiwanger, Bavaria's Minister of Economic Affairs and Chairman of the LfA Supervisory Board, says:
"Bavaria needs startups that drive innovation and growth. To ensure this continues, we are strengthening our commitment with the VC4 startup initiative. The increase in LfA-EIF facilities within this framework sends an important signal to the startup scene in Bavaria."
Also Bernhard Schwab, Chairman of the Board of LfA, emphasizes the importance of the cooperation:
“Our long-standing collaboration with the EIF is a real success story. The funds are reaching their intended recipients and strengthening the entire VC fund landscape in Bavaria. In doing so, we are promoting the high-tech sector and the startup scene here in the Free State.”
The LfA Development Bank Bavaria has been operating as a state-owned specialist bank since 1951 and supports small and medium-sized enterprises as well as infrastructure projects in the Free State. European Investment Funds It belongs to the European Investment Bank Group and facilitates access to financing for small and medium-sized enterprises (SMEs) in Europe through venture capital, guarantees, and microfinance products. Information on financing options is available from [website/organization name]. LfA funding advice.
