High-Tech Gründerfonds (HTGF) is raising its seed investment to €600,000 and lowering interest rates by 4%, as a response to changing requirements in the European startup and venture capital scene, as well as current interest rate trends. Based on HTGF’s change of financing conditions for new investments, the maximum seed investment amount will be raised from €500,000 to €600,000. Additionally, the maximum amount of shares that HTGF will obtain will be 15%, with up to €1.5 million being available for subsequent rounds for every invested startup. As of the interest rate of the subordinated loans will be reduced from 10% to 6%, and interest payments will be deferred for 4 years to preserve the startup’s liquidity! The founders’ financial contributions will be adjusted to a uniform 10% of the initial HTGF seed investment across all old and new federal states. Investors (business angels, private, and public investors) may provide half of this amount.
It must be pointed out that since 2005, HTGF has been financing young technology startups that aim to take promising research outcomes to commercialization: from cleantech and robotics to developing active pharmaceutical ingredients, and from chemistry to software. Until today the fund has already financed something more than 420 startups. As commented by Dr. Michael Brandkamp and Dr. Alex von Frankenberg, High-Tech Gründerfonds Managing Directors: “We believe that a change to the financing conditions is necessary in order to continue offering attractive conditions in line with market requirements. The aim of increasing seed investment is to safeguard companies’ liquidity in the first 12 to 18 months.”