the financing instrument for innovative startups by the state of Baden-Württemberg
Funding needed at a very early stage? The financing requirement is between €50,000 and €200,000? Are you looking for a support partner for your startup?
Pre-Seed BW is a convertible loan for Innovative start-ups with a realtionship to Baden-Württemberg.
As a Startup you can apply via Campus Founders as one of the Accelerators, supported by the state of Baden-Württemberg.
With Pre-Seed BW Startup can apply for a maximum Loan Agreement of 400.000 €. The normal Convertible loans are 200.000 €. These exceptional cases with 400.000 €, which are a doubling of the usual Pre-Seed BW convertible loan is possible, but onlikely and needs well prepared reasons..
The 200.000 € convertible loan is financed by two parties. On the one hand side the Startup has to find an Investor (Co-Investor) by themselves, which is investing into the Startup. On the other side is L-Bank, which is financing 80% of the amount. They quadruple the investment of the Co-Investor to the maximum of 160.000 €. So the Investor has to bring at least 40.000 €.
Requirements for Pre-Seed BW
- Innovative Startup (Service or product)
- We will proof your innovative approach in the first meeting and with your pitch deck)
- Founded less than 5 years ago)
- You have to be supported by one of the Pre-Seed BW Accelerators)
- Reference and strong relationship to Baden-Württemberg)
- Co-Investor who invests at least 20 % of the total funding amount
In this example we think about a Startup, which is looking for a founding with the amount of 200.000 €
To achieve this funding the startup needs to find an investor, which is taking care, of at least 40.000 € (20 % of the investment). The L-Bank is taking care of the other 80 %, which is 160.000 €.
The Investor could be a Business Angel, a corporation or an other investment type.
It`s possible, that the investor expands the investment to a maximum of 50% of the investment. As the maximum limit of L-Bank is 160.000 €, the Investor can only raise his/her investment up to 160.000 €.
Is the investment Committee accepts the Funding request, the convertible loan gets paid to the startup. If they are performing well, there are several options what will happen with the convertible loan:
Option A: L-Bank is converting the loan into shares and becomes a shareholder of the company. (Experience shows, that this is an unlikely scenario)
Option B: Startup and L-Bank are defining the conditions, how the loan is paid back. Usually the startup has between two to five years to pay the loan and interests back. This is bases on the perfomance and liquidity of the startup.
If the venture is not going well or if there is no liquidity (insolvency), the loan expires.
- Information for Startups which are interested in Pre-Seed BW
- Information for Pre-Seed BW Investors
- Information about application process
- Information about the application to the investment Committee
- Information about the contracts and payments
- Information about the process after a successful Pre-Seed BW Application
- Information about duration and coversion
Startup fills out pre-seed contact form on CF website
INITIAL ADVISEMENT & EXAMINATION
Is BW Pre-Seed the right financing for startup? Does Startup meet the criteria for BW Pre-Seed?
Every Wednesday 3 slots of 45 min. 10 min. Startup Pitch 30 min. Q&A
Debriefing and decision/next steps
REGISTRATION FOR THE
Registration usually 10 days before the committee Support in the preparation of pitch deck and financial plan
PITCH TO THE DECISION-MAKING COMMITTEE
Fixed dates usually every 2 months 10 min. pitch 20 min. Q&A Support partners and co-investors can make recommendations if necessary Acceptance/rejection after 1 week (possibly with milestone)
APPLICATION & PAYMENT
Assistance with the preparation of applications Submission by support partners Contract Signing & Withdrawal Request Ongoing: Quarterly updates, interim proof of use, financing committees, contract renewals