Federal government: "Start-up booster" for the Corona crisis

Start-ups are to receive two billion euros in tailor-made support during the Corona crisis.

This article is part of the special feature GründerNavi – for founders and young companies

Start-ups will now receive better protection against the consequences of the coronavirus pandemic . The initiative is a joint effort of the Federal Ministry for Economic Affairs and Energy and the Federal Ministry of Finance . Federal Minister for Economic Affairs and Energy Peter Altmaier stated : "We are creating a two-billion-euro start-up booster as coronavirus support for start-ups, young technology companies, and small and medium-sized enterprises (SMEs) . Traditional loan instruments are often unsuitable for these young, innovative companies. Therefore, we are offering a tailored support package . We are investing around two billion euros and expanding venture capital financing so that funding rounds for promising, innovative start-ups from Germany can continue. This will secure jobs and innovation in Germany."

Financing rounds should be able to continue

Federal Finance Minister Olaf Scholz : "Start-ups should be able to continue successfully developing their ideas even in the current crisis. That's why we will now provide rapid assistance to founders. With a two-billion-euro aid package, we are ensuring that this innovative growth sector, with its many thousands of employees, weathers the crisis well . This assistance will allow financing rounds to continue. This is crucial, because Germany needs innovative minds for a bright future."

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The German government is supplementing existing support programs with a package of measures specifically tailored to the needs of startups , i.e., young companies . Startups also generally have access to all support measures within the coronavirus aid package . However, traditional loan instruments often do not meet the needs of young startups.

Schrittweise Umsetzung

The package of measures includes in particular the following elements, which will be implemented gradually:

•  Public venture capital investors at the fund of funds and fund level (e.g. KfW Capital, European Investment Fund, High-Tech Gründerfonds, coparion) should be additional public funds provided within the framework of the Co-investment can be used together with private investors for financing rounds of start-ups.
• The fund of funds investors KfW Capital and European Investment Fund (EIF) are expected to additional public funds be able to take over shares from defaulting fund investors.
• For young start-ups without venture capitalists among their shareholders and for small and medium-sized enterprises, financing with venture capital and equity-substituting forms of financing should be made easier.

In parallel with the implementation of the package of measures, the Federal Government is continuing to coordinate the design of the Future Fund for Start-ups , which is intended to support the way out of the crisis in the medium term.