High-Tech Gründerfonds (HTGF), a Germany-based public-private partnership funding seed-stage technology companies, is set to raise its investments to €600,000 ($655,000) in return for an equity stake of up to 15%.
HTGF will also make up to €1.4m available for follow-on funding for each portfolio company.
In future, HTGF will require each startup to secure additional investment that is equal to 10% of the fund’s initial commitment. At least 5% must be provided by the founders, while the remaining capital may be sought from external investors.
The 10% rule will apply to startups across all federal states, whereas the fund previously offered different terms depending on whether a company was based in the old or new federal states.
HTGF previously invested €500,000 and required a 10% interest rate on loans. As part of the overhauled rules, interest payments will be deferred for four years and the rate reduced to 6%.
The changes will come into effect on January 1, 2016. The decision to change its conditions was made in light of the specific requirements of the life sciences and mechanical engineering sectors, which often require larger sums to get their research ready for market entry.
Founded in 2005, HTGF focuses on investments that will help startups achieve commercialisation of their technology. The fund has invested in more than 420 startups across a wide range of sectors including the cleantech, software, robotics, chemistry and pharmaceutical industries.