Corona aid for start-ups: only a quarter paid out so far

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The corona crisis did not hit the start-ups as badly as feared at the beginning.

Larger companies in particular benefited from the full accounts of the VC funds, which continued to look for lucrative investment opportunities.

At the beginning of the crisis this was not foreseeable, the federal government wanted to help young companies and - with some delay - launched a large support program: a total of two billion euros should benefit start-ups.

But how much of it has ended up with you so far?

According to the calculations by “Gründerszene”, only around a quarter of the aid has actually been paid out to date.

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The Corona aid measures are divided into various programs and responsibilities: On the one hand, there is the so-called Pillar 1 for VC-financed start-ups.

This is taken care of by KfW Capital, which has been commissioned by the responsible ministries to manage the funds.

The second pillar is aimed at smaller start-ups.

Here, the allocation is different from pillar 1, a matter of the country.

The funds are awarded through the respective funding institutions of the federal states.

How this works exactly differs greatly from state to state.

In Berlin, for example, the Investitionsbank Berlin (IBB) commissions so-called intermediaries to pass on the funds.

This could be business angels, for example, who invest in the respective start-ups themselves.

Only 500 million start-up aid paid out

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“Gründerszene” has asked various offices to find out how much money has actually flowed so far.

In Pillar 1, KfW Capital has so far contractually promised 743 million euros, but only less than half of this has actually been paid out, a total of 316 million euros (as of 02/18/2021).

The VCs who have received the aid for their start-ups can decide for themselves whether and when to call up the money that has been approved.

In Pillar 2, the state development bank KfW has again concluded contracts with the federal states' promotional institutions for a total of around 619 million euros.

According to KfW, the state development institutes have currently called up EUR 176.5 million from this.

This amount does not exactly correspond to the amount that was actually passed on to the start-ups, sometimes the funding agencies have supplemented the aid with their own funds.

Nevertheless, the number gives a rough guide.

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If you add up the funds previously spent from pillars 1 and 2, you get around 500 million euros - just a quarter of the originally announced two billion euros.

Is it a positive sign for the start-up scene?

KfW sees this as a positive sign for the start-up scene, especially for venture capital-financed companies: “Since the VC market proved to be more robust overall in the pandemic year than initially feared, some VC players were able to draw on the already approved replenishment of liquidity renounce ", so a spokesman.

In fact, the start-up dying feared at the beginning did not materialize.

Larger start-ups in particular benefited from the willingness to invest on the part of many VC funds.

Smaller start-ups and their investors are also positive about the federal government's aid program.

Like Oliver Pabst, CEO of the outdoor company Mammut.

He is a business angel and has been a so-called intermediary in Berlin since October, i.e. someone who takes over the examination of start-ups for the IBB responsible there.

He thinks this division of tasks is clever.

“It makes total sense to outsource the due diligence to motivated intermediaries.” Participation also benefits him: he can easily raise new investor money for his own portfolio companies via the program.

IBB participates in such investments with up to 800,000 euros - provided that private investors like Pabst invest at least 200,000 euros themselves.

As is already the case with the support program for VC-financed start-ups, intermediaries such as Pabst do not receive any additional management fees for their mediation role.

Application deadline for Corona aid extended

Pabst became aware of the program through media reports and through the president of the start-up association Christian Miele, who drummed up publicity for support measures for start-ups in the Corona crisis.

Pabst had to prove a connection to Berlin and that he was already active as an investor.

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But then everything went quickly, he says.

It took about six to eight weeks from the first contact to the first investment.

Together with IBB, he has made four investments so far.

One of them was the Berlin cargo bike manufacturer Sblocs Bikes.

So far, he had already been involved in all the start-ups in which he invested with IBB.

In the coming months, however, two new investments should follow, according to Pabst.

According to the IBB, Berlin has already approved almost 72 million euros for a total of 134 start-ups with its program.

The Berlin pot is actually double that, a total of around 140 million euros.

This is why the application deadline has been extended: applications can still be submitted until the end of April this year.

In this context, IBB is also looking for new intermediaries.