MUNICH Good news for the Bavarian start-up scene. The LfA-EIF Facility – a fund of funds that invests in Bavarian venture capital funds – has today been increased to EUR 150 million. Bavaria's Minister of Economic Affairs, Ilse Aigner: “Young, innovative companies often have a hard time finding an investor to help them turn their great ideas into business success. This fund aims to help with exactly that, and stimulate the Bavarian venture capital market.”
The fund is in high demand with investors. 18 venture capital funds based in Bavaria have so far been promised assistance from the fund – EUR 99.6 million in total. Because this tied up almost all of the original volume of EUR 100 million, another EUR 50 million needed to be added to the fund. Around EUR 33 million of the money pledged has already been paid to the funds being financed – 50 per cent each from the LfA and EIF. The funds had already invested around EUR 85 million in 30 Bavarian companies over the same period, meaning that every euro from the LfA initiates EUR 5 in investment.
Aigner again: “Start-ups and young companies drive progress, create jobs and are crucial for the competitiveness of our economy. In order to kick-start investment here, we demanded an improvement in conditions for venture capital and entrepreneurs in the Bundesrat already last year. The fund is therefore an integral part of our overall concept for making Bavaria the top German state for entrepreneurs.”
The fund was created on the initiative of the Bavarian Ministry of Economic Affairs, LfA Förderbank Bayern and the European Investment Fund (EIF) and has been investing in venture capital funds in Bavaria since 2009. It is funded in equal parts by the LfA and EIF. The aim is to expand the range of venture capital available for small and medium-sized companies in Bavaria.