INVEST — Venture Capital Grant (Zuschuss für Wagniskapital)

INVEST — Venture Capital Grant for Business Angels

Supports business angels investing in innovative German startups during early growth.

INVEST (Zuschuss für Wagniskapital) is a rolling federal grant programme administered by BAFA on behalf of the German Federal Ministry of Economic Affairs and Climate Action. Its purpose is to improve access to private venture capital for young innovative companies in Germany by reducing the effective cost of angel investing. The grant is paid to the investor — a business angel — rather than to the startup receiving the investment.

The programme operates in two components. The acquisition grant (Erwerbszuschuss) reimburses 20% of the direct equity investment amount, paid tax-free to the angel after proof of share purchase and payment are submitted to BAFA. For convertible loan investments the rate is 10%. Upon a profitable exit, an additional exit grant (Exitzuschuss) of approximately 25% compensates the investor for the capital-gains tax burden, bringing the combined incentive to roughly 40% of the invested amount. The maximum acquisition grant is €100,000 per investor per calendar year, with a cumulative cap of €3 million per company across all investors. The target startup must be fewer than seven years old, employ fewer than 50 people, have its headquarters or a permanent establishment in Germany, and operate in an innovative sector demonstrated via patent, R&D expenditure, or recognised funding. The investor must be a natural person resident in the EU or EEA; corporate angel vehicles do not qualify.

Both the startup and the investor must register with BAFA and receive a confirmation of eligibility before the investment transaction takes place — post-investment applications are not accepted. Founders using INVEST as a fundraising signal should confirm that their prospective angel qualifies as a natural person EU/EEA resident and that both parties complete the pre-registration step through the BAFA online portal before any funds change hands.