Investment grant

INVEST – grant for business angel capital

In 2013, German government has launched a grant, specifically designed for Business Angel investments, called INVEST.

BAND accompanied the creation of the grant, which aims to support private investors providing seed funding for start-ups. The angel investors receive a grant of 20% of their investment when the following standards are met.

In 2017, the maximum investment sum was raised by 100% and an Exit Grant was introduced among other changes.

I. Purchase Grant

General framework of the grant:

  • Investment between 10,000€ and 500,000€
  • Maximum grant per year per investor of 100,000€
  • Maximum investment of 3m € per company per year
  • Lock-up period of three years

Requirements for the company:

  • Not older than 7 years
  • SME in the definition of EU: less than 50 employees, maximum revenue or gross assets of 10m €
  • Not to be listed on the stock exchange
  • Head office within the EEA, at least one branch in Germany
  • Carry on an innovative trade as defined by a list of the Federal Office of Statistics
    • or prove to be innovative through a patent of central importance to the business (max. 15 years old), the receipt of public funding for research and innovation up to two years prior or an independent assessment
  • Not to be dominated by another company

Requirements for the investor:

  • Natural person with permanent residence in the EEA or a GmbH or UG (limited company) with up to six shareholders
  • Investment needs to made on one’s own account
  • No credit financing
  • No prior shareholder of the investee company
  • Not associated with the company

Rules of the process:

  • Companies apply for eligibility at BAFA (Bundesamt für Wirtschaft und Ausfuhrkontrolle
  • Investor applies for the grant separately afterwards
  • Payment is due not until the verification of the investment

II. Exit Grant

The Exit Grant is 25% of the profit of a sale of shares, which were previously supported by the INVEST Purchase Grant

  • It can only be received by natural persons
  • The purchase of shares must have been supported by INVEST after January 1st, 2017
  • The profit of the sale must be at least 2,000€
  • The Exit Grant is limited to 80% of the issue price of shares, which were supported by INVEST

INVEST Guideline (German)

INVEST Directory

The Federal Ministry for Economic Affairs is hosting an online directory of those companies which are eligible in the framework of the “Investment Grant for Business Angels”. The online directory is only available in German.

Online directory of eligible companies (the directory is not exhaustive)