Silent participation by the Mittelständische Beteiligungsgesellschaft Baden-Württemberg (MBG)

The MGB provides equity capital, typically in the form of silent participation, to investors for the foundation or takeover of a company or an active stakeholding in a company. In this way, the company’s equity can be increased while avoiding influence of the capital provider on the company’s business. Eligibility criteria for a silent participation are:

• The company is a small and medium-sized enterprise in the sense of the EU definition.
• The investment location is in Baden-Württemberg.

The participation is made on equal terms, i.e. in the amount of the existing equity. The minimum and maximum limits for business foundation are $ 50,000 and $ 250,000, and for company successions $ 50,000 and $ 750,000. The silent participation is repaid at the nominal value after 10 years. Interest payments consist of a fixed and an income-related rate. The silent participation does not participate in value increases beyond the income-related interest payments. Loss sharing is limited to the case of insolvency.

 
ERP capital for business startups (KfW)

With its ERP capital for business establishments, KfW offers investors a subordinated loan for the financing of business startups (new business starts, takeovers, active stakeholdings) and investments within two years after the start of self-employment. The loan does not require any collateral on the part of the co-lending bank and creates financing leeway. Preconditions for this investment grant are a minimum equity investment of 15% and the fulfillment of the EU's definition of a small and medium-sized enterprise. Mezzanine financing benefits from an interest discount during the first few years as well as seven amortization-free initial years. The maximum amount per applicant is $ 500,000.