Lower Saxony invests 50 million euros in start-ups

The state is focusing in particular on start-ups in the so-called greentech sector.

The state of Lower Saxony wants to expand its startup funding and is investing a total of 50 million euros in five growth funds, each of which will be endowed with ten million euros. The money will come from the state-owned NBank, with additional capital to come from private investors, according to a statement from the Ministry of Economics.

The money is intended primarily to help start-ups in the expansion phase that have a high cash requirement. The first of what is expected to be five regional growth funds in Lower Saxony was founded in Osnabrück on August 09, 2022, with a high level of financial participation from the state. For this purpose, a contract was concluded with Scalehouse Capital Management GmbH from Osnabrück. The Osnabrück fund will start with a volume of around 23 million euros and will invest primarily in startups in the fields of nutrition, agriculture and digitalization.

Jesse Jeng, Managing Partner of Scalehouse Capital, explains that most capital in Germany would be located in large cities and would therefore also produce successful startups. He goes on to say, "However, it is not a law of nature that circa 90 percent of the funds invested in startups in Germany flow to a few large metropolitan areas."

Bernd Althusmann, Lower Saxony's Minister of Economic Affairs, is very pleased because the 50 million euros will be invested in the future of the economy. He also described the launch of the growth fund in Osnabrück as a milestone for Lower Saxony's start-up ecosystem and praised the cooperation to date: "The private-sector initiators around Jesse Jeng have succeeded here in attracting some of the most respected entrepreneurial personalities in western Lower Saxony to this joint venture between the state and the private sector. In the future, we will thus be able to offer Lower Saxony start-ups an attractive financing alternative to the growth funds from Berlin, Hamburg and Munich."