Further capital for sustainable technology innovations in Hesse

bmh launches fourth fund in the "Technologiefonds Hessen" family. First bmh fund with BaFin approval as an alternative investment fund (AIF). Target volume of EUR 30 million, of which EUR 23 million already secured in the first closing. Consideration of ESG criteria as a central component.

Wiesbaden, October 17, 2023 - bmh Beteiligungs-Managementgesellschaft Hessen mbH has launched Technologiefonds Hessen IV (TFH IV) to finance innovative technology start-ups and smaller technology companies in Hesse. This expands the TFH fund family that has existed since 1998. TFH IV is the first fund to be approved by the German Federal Financial Supervisory Authority (BaFin) as an alternative investment fund (AIF). The target volume of this fund is EUR 30 million, of which EUR 23 million has already been secured in the first closing. The anchor investors include the State of Hesse, Helaba, WIBank and DZ Bank.

We want start-ups that focus their business idea on sustainability to receive the right financing. State funds amounting to 10 million euros will be increased by 13 million euros from the banks involved so far. Young companies can thus bring innovations to the market and also test unconventional approaches.

Michael Boddenberg, Hesse Minister of Finance

The Hessen IV Technology Fund will serve as an important source of financing for innovative technology companies in Hessen. These companies are characterized by sustainable business models and are at various stages of development, from the late seed phase to the Series A round. The fund aims to provide a total of EUR 30 million to the Hessian technology sector, with EUR 23 million already successfully raised in the first closing. This is the first time that bmh has managed an alternative investment fund with BaFin approval, which opens up the possibility of attracting additional private investors. The usual investment range of TFH IV is between EUR 500,000 and EUR 2 million, with the planned investment period generally being five years. The fund itself has a term of ten years, with an optional extension of a further two years.

The further development of our location in the direction of a sustainable and climate-friendly economy is our most important task.

Tarek Al-Wazir, Hesse Minister for Economic Affairs

The Technology Fund Hesse IV will take ESG criteria (environmental, social and governance) into account both in the investment process and in portfolio management. Each potential portfolio company will be examined for ESG risks during the due diligence phase, with the 17 Sustainable Development Goals serving as the basis for assessment. Companies that do not achieve the minimum score will not receive any investments from TFH IV. ESG workshops are planned during the investment period for start-ups that meet the defined criteria. These workshops will be conducted in cooperation with experienced sustainability consultants to promote the integration of ESG principles into the companies' business practices.#

We have been observing a trend towards ESG-oriented business models among technology start-ups in particular for some time now, and this trend has intensified significantly over the past year. With TFH IV, we are now adapting our support to the changing needs of the Hessian technology sector

Jürgen Zabel, Managing Director of bmh

Not exclusively according to ESG criteria

At the same time, however, Dr. Steffen Huth, Managing Director of bmh Beteiligungs-Managementgesellschaft Hessen mbH, emphasized that bmh will continue to support the broader technology sector. This means that the fund will not exclusively target companies that are directly focused on the "green transformation", but will also offer support to other conventional technology companies. This will enable bmh to meet the needs of a wide range of companies, including those that are not primarily focused on sustainability but still add value to the technology sector.

The launch of the Hessen IV Technology Fund underlines bmh's commitment to supporting sustainable technology innovation in Hessen and providing vital funding to the technology sector.