Germany’s largest pension fund Bayerische Versorgungskammer (BVK) is joining a group of experts and investors to fund technology start-up companies under the WIN-Initiative.
Other members taking part in the initiative include Deutsche Börse, Deutsche Bank, Allianz, BlackRock, and Dekabank, according to a report published by Handelsblatt newspaper.
Deutsche Börse confirmed taking part in the initiative, relying on years of experience supporting capital markets and growth financing. Dekabank also confirmed to IPE its participation.
“As a leading insurer and investor, we routinely contribute with our expertise to economic policy and government-related advisory committees at various levels,” a spokesperson for Allianz said, declining to comment specifically on the WIN-Initiative.
BlackRock did not reply to a request for comment. Deutsche Bank declined to comment.
With the WIN-Initiative for venture and growth capital, the German government plans to rework the framework conditions for investments in the tech and green tech sectors with the help of a group of experts, under the leadership of state development bank KfW, according to Handelsblatt.
Germany wants to create a framework akin to the Tibi-Initiative in France that is pulling institutional investors to invest €6bn over a three-year period to close funding gaps for tech start-ups.
“We have to think about the fact that, with the same European regulations, in France the capital collection agencies invest far more in asset classes such as private equity and venture capital,” said finance minister Christian Lindner explaining the WIN-Initiative plan.
“This cannot be due to European rules, but only to “specifically German framework conditions”, he added.
The plan to channel capital towards growth companies comes as German institutional investors increasingly opt to allocate in funds abroad.
Over the past few years institutional investors in Germany have opted to invest €600bn in funds abroad, according to figures published by the fund industry association BVI.
“We estimate that in the field of infrastructure financing, for every euro invested in projects in Germany, up to €99 are invested abroad,” said Sebastian Oys, head of tax policy at BVI, in a LinkedIn post.
Assets under management of German institutional investors in foreign funds have increased 3.35 times over the past 10 years, while assets in domestic funds have only grown 1.98 times over the period, he added.
“We need more investments and asset managers in Germany, that must become more competitive and attractive [for funds]. Germany has so far missed a trend. Other countries, such as Luxembourg and Ireland, are much further,” Oys said.