In December 2025, the German government launched a massive investment fund called "Deutschlandfonds." The fund's goal is to mobilize private investment in key economic sectors. Deutschlandfonds is managed by KfW, Germany's state-owned development bank. The government in Berlin has allocated approximately 30 billion euros for this purpose, mainly in the form of guarantees, with the aim of stimulating total investment of 130 billion euros. The funds come from a 500-billion-euro public infrastructure fund.
For startups, the fund offers financing options such as "Scale-up Direct" — direct equity investments of up to 50 million euros per company, with a total value of 1 billion euros through 2030 — as well as "First-of-a-kind loans."
In the industrial sector, the new fund is investing in transformative technologies, offering a total of 8 billion euros in guarantees for projects involving battery storage, hydrogen, and CCU/S. Meanwhile, the existing raw materials fund, with a pool of 1 billion euros for 2024–2028, will support the extraction and recycling of critical raw materials.
For utilities, the fund provides loans for geothermal projects, "Renewable Energies Plus loans," and investment/syndicated credit facilities for renewable energy sources, grids, and heating. Priority sectors include renewable energy, storage, grid infrastructure, automotive, deeptech, AI, biotech, cleantech, and defense. The government is also considering a module for the construction sector.
Deutsche Bank Research considers Deutschlandfonds a boon for current investment, transformation, and startups. However, its structure is complex. The key challenge now is attracting private capital.
The Association of German Chambers of Commerce and Industry (DIHK) views the fund as an important stimulus but emphasizes that money alone is not enough. DIHK President Peter Adrian points to a problem beyond capital: there is still a lack of confidence in Germany as a business location. According to a DIHK survey, only one-fifth of companies plan new investments in Germany. Equipment investment remains at 2015 levels. Helena Melnikov of DIHK adds that the government must treat private investors as partners, not adversaries. The priorities should be reducing labor and energy costs, cutting red tape, and accelerating the approval of applications and permits.
Vice Chancellor and Finance Minister Klingbeil (SPD) emphasizes that this is not a state fund. In his view, it is a platform of guarantees and loans that mobilizes private capital. In media appearances, Klingbeil has stressed that 10 billion euros from the federal budget could unlock as much as 100 billion euros in private investment, with a focus on startups, critical raw materials, and energy.
