Venture capital in Germany

Abstract

The financing of entrepreneurial activity in Germany has a long tradition, and at least reaches back to medieval times, when vast trading empires, such as those associated with the Hanse and Fugger, blossomed in regions that are now part of Germany. The advent of modern venture capital firms is a much more recent phenomenon in Germany, though. Only by the mid-1960s the first Kapitalbeteiligungsgesellschaften (KBGs - equity stock companies), which can loosely be regarded as the German counterpart to the U.S.’ SBICs, were founded. Finally, nearly another two decades later, in 1983, the first independent, U.S.-style venture capital firms came into being in Germany.