KfW Capital in financial year 2025
Fuelling innovation: Venture capitalStart-ups and early-stage tech companies are developing innovative solutions across various sectors to address the key challenges of our age. For their visions to become a reality, a number of factors are important, such as entrepreneurial courage, a strong network and, above all, sufficient capital in every phase of growth. Quick and sufficient access to venture capital (VC) is therefore a prerequisite for growth. KfW Capital, a wholly-owned subsidiary of KfW, has become one of the most important venture capital investors in Europe eight years after its launch.
A reliable partner for the VC ecosystem
KfW Capital acts as a reliable investor, enabler and partner with the goal of strengthening and advancing Germany’s venture capital ecosystem. Complying with market practice and applying the same terms as other private investors, KfW Capital invests
- in European VC funds that finance start-ups in Germany with at least the capital contributed by KfW Capital,
- in start-ups and scale-ups with a link to Germany,
- coordinates the Future Fund on behalf of the German Federal Government and implements the venture capital pillar of the Germany Fund, which is intended to strengthen Germany as a business location.
KfW Capital also acts as an investment adviser and intermediary for the Growth Fund Germany and is currently preparing to raise funds for Growth Fund II. Both umbrella funds are designed to mobilise substantial amounts of private capital and to invest it in a professional manner.
Investing in the future
As at the end of the year, KfW Capital has been invested in 153 venture capital funds with a total volume of around EUR 2.9 billion, with the support of the German Federal Government. As a result, around 2,900 start-ups and innovative technology companies have already been promoted. The VC fund portfolio is broadly diversified: ICT (Information and Communication Technology) 47%, Life Sciences 21%, Industrial Tech 9%, Generalist 23%. On average, the VC funds invest close to 4.8 times the capital contributed by KfW Capital in companies in Germany. All of the funds have their own ESG policy.
Financing growth
In 2025, KfW Capital made investment commitments amounting to EUR 748 million. KfW Capital invested a total of EUR 383 million at its own risk in 21 European VC funds (2024: EUR 381 million in 21 funds). KfW Capital invested a further EUR 363 million in a fiduciary capacity on behalf of the Federal Government as part of the Future Fund. This means that KfW Capital’s investment volume is above the previous year’s level: Without non-recurring effects under the Future Fund of EUR 930 million, it amounted to EUR 659.4 million in 2024.
Implementing the VC pillar
As part of the Federal Government’s Germany Fund, KfW is strengthening Germany as a centre of business and innovation with a wide range of promotional and financing measures. The VC pillar of the Germany Fund specifically addresses start-ups and scale-ups and is being implemented by KfW Capital. It consists of the VC fund investments, first-of-a-kind loans (FOAK) and scale-up direct modules. An initial investment under scale-up direct has already been committed: KfW Capital, together with the HV Capital VC fund, committed these funds to Quantum Systems, a start-up from the field of SDI/Dual Use.
Mobilising private capital
A good two years after the final closing of the Growth Fund Germany, it had been almost fully invested by the end of the year: Of the fund volume of around EUR 1 billion, around EUR 850 million has already been committed to 42 venture capital target funds, through which more than 400 innovative technology companies have in turn been reached. The Growth Fund Germany is one of the largest VC umbrella funds in Europe; close to 70% of the fund’s volume comes from private investors. A follow-up fund, Growth Fund II, is scheduled to launch in spring 2026. Substantial volumes of private capital are to be mobilised for this fund, too.
Increased safety and security
In 2025, KfW, as a shareholder of KfW Capital, decided to adjust the financing arrangements for companies in the security and defence industry (SDI) in view of the changing geopolitical situation. Its goal here was to strengthen Europe’s agency when it comes to security policy. Since May 2025, KfW Capital has been able to indirectly finance start-ups in the fields of weapons and ammunition. All exposures are in strict compliance with legal requirements and relevant sanctions.
Recognising excellence
Dr Carolin Gabor, Managing Partner at caesar., was named “Best Female Investor 2025”; Miki Yokoyama, Founding Partner at Aurum Impact, received the “Best Impact Investor 2025” award; the special prize “VC Game Changer” was presented to Professor Helmut Schönenberger, CEO of UnternehmerTUM and Vice President Entrepreneurship at TUM. With these awards, KfW Capital recognises outstanding people and deliberately puts the spotlight on topics that are important to the VC ecosystem.
Encouraging shared knowledge
The KfW Capital VC Academy is an advocate for the regular sharing of knowledge and networking among experts on the VC ecosystem. Since 2022, we have been organising regular “Academy” events at KfW’s offices in Berlin and inviting experts to speak on topics relevant to the VC market. In 2025, we focused on life sciences, VC impact investing, tools and ideas for strengthening the VC ecosystem and, last but not least, the success of investments, start-ups and VC funds and how venture education can influence this. The series will continue in 2026.
Strengthening VC investor expertise
KfW Capital supports the qualification of new and experienced investors in the German VC ecosystem. New certificate courses were developed in 2025 as part of the WIN initiative with the Frankfurt School of Finance & Management. In addition, KfW Capital once again awarded two “Women in VC” fellowships to participants in the VC professional development programme at BVK and the Technical University of Munich, in order to further encourage women to develop their professional skills. KfW Capital also offered ESG training courses for VC funds in cooperation with Reframe Ventures and the BMW Foundation Herbert Quandt.
Legal notice:
The information contained in this online Annual Report 2025 is based on KfW’s Financial Report 2025, which you can download here. Should this online Annual Report 2025, despite the great care taken in preparation of its content, contain any contradictions or errors compared to the Financial Report, the KfW Financial Report 2025 takes priority.
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