KfW Capital: Invested in 100 venture capital funds with more than 1,900 start-ups in the last five years

• KfW Capital financed more than 1,900 start-ups with 100 venture capital (VC) fund investments
• More than EUR 1.9 billion has already been made available to the VC ecosystem
• Around half the start-ups reached are active in the field of technology, and more than one third are working on sustainable innovations
• KfW Capital contributes to the sustainable and digital transformation and to the development of a competitive VC ecosystem

KfW Capital will celebrate its fifth anniversary this Saturday, 15 October 2023. Since its launch in the VC market, KfW Capital has invested more than EUR 1.9 billion in over 100 VC funds with support from the ERP Special Fund, the Future Fund and resources from KfW. That makes it one of the largest VC fund investors in Europe. Under its federal mandate it boosts the VC ecosystem in Germany on a sustainable basis by giving start-ups and innovative technology firms greater access to capital through financially stronger VC funds. The VC funds in which KfW Capital participates invest around four times the capital brought in by KfW Capital in start-ups and innovative tech companies in Germany. They have already financed more than 1,900 start-ups in total. Around half of the businesses reached operate in the field of technology, while more than one third are working on particularly ‘sustainable’ innovations in the fields of mobility, medicine, hydrogen, bioeconomics, circular economy, climate technology, AI (artificial intelligence) and quantum technology.

“We live in the decade of decisions in which we need to act to successfully manage the transition to a sustainable, digital and resilient economy and society. In KfW Capital we have had a highly professional fund investor on hand for the past five years, one that specialises in venture capital and is working to greatly improve the funding conditions for start-ups and innovative technology firms. Investments in more than 100 VC funds, and thus indirectly in more than 1,900 start-ups, are a stupendous success. In this way, with the support of the Federal Government, we are helping to enhance innovative capability, which is so important for Germany as a business location”

, said Stefan Wintels, Chief Executive Officer of KfW and Chair of the Supervisory Board of KfW Capital.

“In hindsight, there could not have been a better time to establish KfW Capital. The urgency of the sustainable and digital transformation has become increasingly more obvious since 2018, and with it the need to strengthen the venture capital market accordingly in order to improve the funding situation of innovative start-ups. As an important investor in VC funds, we are a reliable and professional partner of the entire VC ecosystem in good economic times and in bad ones”

, said Dr Jörg Goschin, Senior Managing Director at KfW Capital.

“KfW Capital, too, has grown strongly as a company by taking on more tasks in the past years. Only in this way have we been able to successfully fulfil our mandate to strengthen the VC ecosystem on a sustainable basis. In doing so, we are also keen to ensure diversity, since we believe it is the foundation of a strong team. For example, our interdisciplinary team is now almost 50% female”

, said Alexander Thees, Senior Managing Director at KfW Capital.

When KfW Capital entered the market, it aimed for a commitment volume of EUR 200 million . Its tasks have grown continually since then, and this year KfW Capital plans to invest around EUR 500 million in VC funds with support from the ERP Special Fund and the Future Fund and with resources from KfW. KfW Capital is not just an investor but a 'product and market developer'. During the pandemic it structured the two billion euro package for start-ups for the Federal Government within a very short period of time and subsequently implemented the first pillar known as the Corona Matching Facility jointly with the European Investment Fund (EIF). On behalf of the Federal Government, and in close cooperation with the German Federal Ministry for Economic Affairs and Climate Action and the Federal Ministry of Finance, KfW Capital is coordinating the Future Fund, which has grown to more than EUR 10 billion and whose individual building blocks will significantly strengthen the VC ecosystem and additionally leverage substantial amounts of private capital. Six building blocks have already been successfully introduced into the market The “Zukunftsfonds” (Future Fund) (kfw-capital.de).

KfW Capital invests irrespective of the business cycle, in line with the market and across all sectors through the two flagship programmes “ERP-VC fund investments” and “ERP/Future Fund-Growth Facility”. Under the Climate Transition Facility that has been on offer since June, the fund investor is also making targeted investments in a specific sector (climate tech) pari passu with further investors in order to give climate technologies, which are so important for Germany, a boost. The portfolio is accordingly diverse. Around 44% of the VC funds in which KfW Capital is invested focus on ICT, 22% on life sciences and 5% on industrial tech, while 29% invest across multiple sectors. Nearly all VC funds in which KfW Capital is invested have an ESG policy.

Further information on KfW Capital, the investment programmes and KfW Capital’s VC fund portfolio is available at
www.kfw-capital.de.

You will find a detailed interviews with Robert Habeck, Federal Minister for Economic Affairs, Christian Lindner, Federal Minister of Finance, and Jörg Goschin and Alexander Thees, the two Managing Directors of KfW Capital, at Dossier about KfW Capital | KfW Stories.