A 30 billion euro ($30.4 billion) fund is being planned by Germany to aid tech-related startups.
As part of a larger plan to make the nation more appealing for entrepreneurs and innovation, the German cabinet approved the fund on Wednesday.
To raise the “Future Fund,” the government stated it will engage with private investors and use 10 billion euros in public funds from the state-owned lender KfW. Companies that invest in cutting-edge technologies to combat climate change, such as artificial intelligence, hydrogen technology, quantum technology, and sustainable transportation, will be given priority.
Despite an increase in venture capital investment, Germany’s economy is still behind other developed nations, according to the government. According to the report, American investors fund the majority of Europe’s biggest “growth companies,” which attract many of the continent’s most prosperous entrepreneurs to relocate. Their long-term membership in the EU is the goal of the approach.
The government also plans to raise the employee stock option tax-exempt amount and eliminate barriers for foreigners who want to work in the country’s tech sector. It will examine remote work-related concerns, such as taxation and labor legislation, to enable businesses to hire talent abroad without having to relocate their employees.
The new strategy sends “a clear signal that venture capital can also be an interesting investment for public funds and that already a small share could have a big influence on the venture capital market,” according to Anna Christmann, the government’s special envoy on startups, who spoke with reporters on a video call on Wednesday.
The strategy was praised by the German Startup Association for emphasizing the value of startups to Germany’s long-term competitiveness, but it was criticized for falling short on the taxes front.
A strategy is only as good as its implementation, said Chairman Christian Miele in a statement. The German government must not hide behind commitments to review things. To make Germany the world market leader for startups, we need more courage and determination.