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Start-ups are drivers of structural change. They realise innovative new ideas, create jobs and safeguard the foundations for future prosperity and growth in Germany and Europe. Entrepreneurs can be valuable innovators and are tremendously important for Germany’s economic development. The German venture capital market has developed strongly in the last few years. When it comes to early-phase finance for start-ups in particular, Germany is very well positioned thanks to its many public funding programmes at both federal and state level. Despite the international awareness of Germany’s start-up scene, the German venture capital market is too small – both in an international comparison and in relation to Germany’s economic strength. Other countries invest significantly more venture capital. Start-ups in Germany need more capital, especially in the 2nd and 3rd growth phases.

The Federal Government is therefore deploying a range of instruments to fund innovative start-ups. Support is provided indirectly through funds of funds, including the ERP/EIF Fund of Funds or the ERP Venture Capital Fund Investment Programme of KfW Capital, which are participating in private VC funds, and directly through public funds, including the High-tech Start-up Fund (HTGF) and coparion, which invest directly in start-ups. In spring 2020, the Federal Government launched a programme for start-ups at KfW worth €2 billion in order to help start-ups in the current COVID-19 pandemic. All of these instruments are rooted in the same principle: they require a substantial private-sector investment contribution, also for the sake of market principles and in compliance with European competition / State aid rules, thus broadening the basis of the German venture capital market.

The aim of the Future Fund is to expand in qualitative and quantitative terms the Federation’s support architecture and especially the financing options for start-ups going through the capital-intensive scale-up phase. An additional €10 billion has been earmarked for investments and costs of the Future Fund. Furthermore, the ERP Special Fund makes financial contributions to several components of the Future Fund.


The concept of the Future Fund comprises both the quantitative and qualitative expansion of existing funding programmes and the development of new instruments. This is to address all development phases of start-ups with a focus on the expansion of growth financing and to give greater consideration to market segments that have previously not been sufficiently covered. The Future Fund’s components are to substantially expand the established support architecture, which has so far primarily been based on the ERP Special Fund.

The concept, which provides for a 10-year funding period, aims to increase the available capital stock through successful investments and thus create the basis for a greater volume for re-investment without being a burden on the budget. Several components of the concept are already available, and additional elements are currently being developed and implemented. The various components are closely linked and serve as a toolbox. On the basis of regular evaluations, the financing instruments will be adjusted especially as regards the volume allocation, taking account of the changing market environment and new needs. Further public and private investors are to make available funds for the components of the Future Fund; they will bear the risks of these funds. The following components have already been launched:

  • ERP/Future Fund Growth Facility: The established fund investor KfW Capital will in future invest up to €50 million instead of a maximum of €25 million per fund. KfW Capital will thus contribute to increasing the fund volumes of venture capital funds in Germany and Europe and facilitate more frequent and larger financing rounds for start-ups. A total of €2.5 billion will be available for the period up to 2030. Further information can be found at:
  • GFF-EIF Growth Facility: In line with the existing ERP/EIF Growth Facility, a new growth facility with a volume of up to €3.5 billion will be established to invest in growth funds and in growth financing rounds of start-ups. Again, larger fund volumes can facilitate more frequent and larger financing rounds for start-ups. Further information can be found at:
  • DeepTech Future Fund: The DeepTech Future Fund is a new investment fund in the field of deep tech, which will be financed on a long-term basis by the Future Fund and the ERP Special Fund. Its aim is to help deep-tech companies with validated business models to grow sustainably while staying independent. To this end, the DeepTech Future Fund always invests together with private investors. The aim is to support deep-tech companies as an anchor investor on their way towards capital market maturity. The Fund is to further strengthen Germany as an innovation hub as it provides a long-term perspective and makes the country more attractive for high-tech companies. Up to €1 billion is expected to be available for the DeepTech Future Fund in the coming ten years. Further information can be found at:

Further components of the Future Fund will be launched in 2021. A fund of funds for growth capital, for example, is to begin with the fundraising phase in the next few months as soon as all regulatory requirements are met. It is currently being launched with the support of KfW Capital and aims in particular to mobilise capital of institutional investors for start-ups. Further components of the Future Fund are to be launched in 2022.