German Government Unveils Billion-Euro Funding Package for Start-Ups
The German Government Launches 12-Billion Euro WIN Initiative to Support Start-Ups
Berlin Introduces WIN Funding for Start-Ups
The German government, along with state-owned investment bank KfW and private investors including Deutsche Bank, Commerzbank, and Allianz, has announced the launch of a new 12-billion euro funding programme for start-ups operating in Germany.
The programme, called the "WIN Initiative" (Wachstums- und Innovationskapital für Deutschland or Development and Innovation Capital for Germany), aims to provide financial support to start-ups in their early stages. According to the Friedrich-Ebert-Stiftung, a start-up is generally defined as a company that has been operating for less than 10 years.
The government hopes the WIN Initiative will prevent German-founded companies from relocating to competing markets, such as the United States. Chancellor Olaf Scholz emphasized that the initiative will "further strengthen the German venture capital market and the overall business landscape" and noted the importance of growth financing in boosting Germany's innovation and competitiveness.
Berlin's Start-Up Boom
Germany, particularly Berlin, has experienced significant growth in the start-up sector in recent years. In 2012, approximately 10,000 to 30,000 employees were working in 2,500 Berlin-based start-ups, a figure that grew to 80,000 employees across 4,500 start-ups by 2022, according to the Berlin Senate for Economy, Energy, and Services. Berlin is now the second most popular start-up hub in Europe after London.
The city’s start-ups attract a diverse, international workforce, with non-EU citizens accounting for 50 percent of start-up employees in Berlin by 2018 and 30 percent nationwide.
Encouraging Works Councils in Start-Ups
As start-ups grow in importance in the German job market, unions like ver.di and IG Metall have raised concerns about working conditions, especially for employees unfamiliar with German labour laws.
The German government, as outlined in a paper by the Friedrich-Ebert-Stiftung, aims to encourage the formation of works councils (Betriebsräte) in start-ups. Companies with works councils generally offer better benefits, such as more holiday leave, higher wages, and shorter working hours, while also boosting productivity and profits. However, only 38 percent of employees in Germany are part of a works council, and in Berlin start-ups, only about 5 percent are represented by a Betriebsrat."