KfW Capital in 2022
Responsible VC fund investor
As a wholly-owned subsidiary of KfW, KfW Capital aims to improve the provision of venture and growth capital to innovative technology companies in Germany. KfW Capital invests in German and European venture capital funds (VC funds) with support from the ERP Special Fund and the Federal Government's Future Fund (“Zukunftsfonds”), thereby indirectly improving access to growth capital via larger VC funds and boosting Germany as an innovation hub. KfW Capital is also invested in all four generations of the High-Tech Start-Up Fund and in coparion.
Developing the venture capital market
Promotion for young, innovative technology companies was considerably expanded in 2022 as planned. KfW Capital committed around EUR 1.3 billion – an increase of 151% compared to the previous year.
Reviving the VC landscape
KfW Capital has already invested more than EUR 1.7 billion in 85 VC funds, thereby indirectly improving access to growth capital in Germany by strengthening the funds' capital base.
Fostering a culture of innovation
In total, more than 1,600 young, innovative tech companies have been financed to date through VC funds in which KfW Capital has invested. They develop and implement solutions that reinforce Germany’s future viability.
Around one third of the start-ups and growth companies financed through VC funds in which KfW Capital is invested are working on sustainable solutions in areas such as: mobility, bioeconomy, circular economy, climate technology, medicine, hydrogen, AI and quantum technology.
Boosting Germany as a hub
KfW Capital’s invested capital has a 4.6. multiplier for Germany. Around half of the VC funds in which KfW Capital is invested are based in Germany.
Expanding the VC ecosystem
KfW Capital coordinates the Future Fund for Germany with a volume of EUR 10 billion on behalf of the Federal Government. This primarily benefits start-ups in the growth phase that require substantial capital.
Responsible VC fund investor
- The VC funds in which KfW Capital invests are obliged to at least match the amount of capital provided by KfW Capital to finance innovative technology companies in Germany.
- On behalf of the German Federal Government, KfW Capital coordinates the Future Fund, the investment fund for forward-looking technologies, which supports the capital-intensive growth phase of start-ups in particular through several components. More on the Federal Government’s Future Fund at the Federal Ministry for Economic Affairs and Climate Action BMWK and the Federal Ministry of Finance BMF.
- As a responsible VC fund investor, KfW Capital attaches particular importance to sustainability. Fund investors apply KfW Capital’s sustainability guidelines and exclusion list to their investments. VC fund investors attach great importance to the inclusion of ESG criteria for the target funds.
2022: Significant increase in commitment volume in challenging environment
Commitment volume in the business sector KfW Capital totalled around EUR 1.3 billion in 2022 (2021: around EUR 502 billion). The significant increase of 151% is due to various factors:
- firstly, KfW Capital was able to expand the commitment volume to the ERP VC Fund Investments and ERP/Future Fund – Growth Facility programmes further than planned (to EUR 432 million, of which ERP VC Fund Investments: EUR 187 million and ERP/Future Fund – Growth Facility: EUR 245 million). In the previous year, the commitment volume to these two programmes was EUR 298 million.
- Secondly, the commitments to the GFF-EIF Growth Facility implemented by the European Investment Funds with funds held in trust by KfW from the Future Fund have also risen considerably: whereas around EUR 183 million was provided for this in 2021, around EUR 473.6 million was committed in 2022.
- In addition, EUR 312 million was committed within the Future Fund.
- KfW Capital also invested EUR 40 million in High-Tech Start-Up Fund IV.
VC fund investor and market developer
The information contained in this online Annual Report 2022 is based on KfW’s Financial Report 2022, which you can download Should this online Annual Report 2022, despite the great care taken in preparation of its content, contain any contradictions or errors compared to the Financial Report, the KfW Financial Report 2022 takes priority.