Germany Sets up $12 Billion Fund to Finance Technology Startups
(Bloomberg) -- Germany is unlocking 10 billion euros ($12 billion) to support technology startups in their growth phase, bolstering a sector that’s key for job creation in Europe’s biggest economy.
The money is to be distributed via an investment fund meant to address the difficulties startups face when trying to raise venture capital, Finance Minister Olaf Scholz and Economy Minister Peter Altmaier told reporters in Berlin Tuesday.
“Startups are motors of structural change,” Altmaier said. “They create jobs and secure the basis for future prosperity and growth in Germany and Europe.”
German startups including financial technology firm N26, air-taxi maker Lilium and travel platform Omio raised about $4.5 billion last year, with the largest rounds still led by foreign investors, according to a study by consultancy EY.
While access to private capital has improved in recent years, female founders remain a minority in the German startup ecosystem -- an under-representation that needs to be tackled swiftly, said Scholz, who is running for the Social Democrats to succeed Chancellor Angela Merkel after September’s election.
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