Venture Debt for young companies: as part of the “Tech Growth Fund Initiative,” KfW and the Federal Government are expanding the range of growth financing options in Germany with a new financing instrument.
Technologically innovative and fast-growing companies with a promising business model now have the opportunity to obtain loans to finance their further growth thanks to the KfW Venture Tech Growth Financing program.
The program is designed to last at least five years. KfW A total of 50 million euros is available annually. In the first five years, the federal budget will cover 95 percent of the resulting risks.
Prerequisite for venture debt: venture capitalists and financing partners
The involvement of a private lender as a financing partner is a prerequisite for financing from the KfW program. The financing share should generally be 50 percent, and on the same terms ("pari passu"). Another prerequisite is that private venture capitalists already have a stake in the company. The funds are provided directly to the company at market conditions.
