Are you wondering how to get funding for your Berlin-based social business? Then hopefully you’ll find some answers here!
When starting a social business, emotions can run high. Not only because you really feel that your idea could change the world, but also because it is often difficult to identify how you can even fulfill your vision without having at least a little bit of financial support. Change is often not cheap. You might have to design and build a website, a prototype, employ a team, get marketing going and maybe even rent an office space. But how with little to no money?
Don’t worry! Even though Germany still lags behind the U.S and UK when it comes to social investment, there are a few good possibilities to get funding for your idea.
1. Friends and Family:
If you are lucky enough to have friends and family that might be able to support your idea financially, you should definitely talk to them.
Social entrepreneurs often forget to ask their closest network to support them financially. It is not shameful, if you believe in your idea - which you should, if you are thinking about starting a company - to ask your loved ones if they would like to invest in you. There are many different ways for this to be done professionally. Write up a contract covering everything both parties agreed on e.g. form of investment (loan, donation etc.) so you both have the security for later.
There are a couple of standard contracts out here, here is one for a start.
Beuth Hochschule/ Business Innovation Center
The Business Innovation Center (Gründerwerkstatt) offers 12-18 month long scholarships for tech-oriented ideas. This includes 4000 Euro/Month for two team members and free office space in Schöneberg.
- Have an idea with a highly technical aspect
- Write a complete business plan (20 pages)
- Fluency in German (the pitch will be in German)
- Willingness to take on a full-time commitment
Usually there is a call for applications in October and March. For more information, please visit the Beuth website.
Exist offers three different forms of scholarships: a monthly stipend of up to 2,500 EUR; up to 5,000 EUR in coaching; or material expenses of up to 17,000 EUR for teams.
- An innovative, technical idea/ innovative education-based service
- A team of not more than three people
- A university “mentor”, who applies on your behalf or matriculation at a university yourself
- You cannot have founded your business already
Applications are accepted at all times. For more information, please visit the Exist website.
PEP offers part-time and full-time programs. The full-time program is a one year scholarship that supports young people to develop their social businesses with max. 1200 Euros/month, as well as offering coaching through Ashoka, mentoring and further education.
- You should be between 16 and 27 years old
- Your idea needs to be non-profit oriented
- You should be living in Germany
Check out their website for current application opportunities. You can also read our interview with PEP fellow Ekaterina.
Social Impact Start (No financial support)
Although it doesn’t offer funding directly, social impact start is an incubation program for social entrepreneurs in the early start-up phase. The program covers a period up to eight months and includes:
- Access to networks;
- Intros and matching with potential financing partners;
- Professional assistance in writing applications for financial support
- Mentoring by SAP employees;
- Desks in their co-working space in Kreuzberg.
- You have a socially innovative idea that has not yet entered the market
- You can offer a full-time commitment
- You have an entrepreneurial spirit
For more information, please visit their website.
3. Social Investors:
Bon Venture supports projects in the areas of social services, products, ecology and societal education and development. There are different financing models, but they will usually only invest above 200,000 EUR.
- The idea should solve a social/environmental problem
- The project should be projected to be self-financing after the investment
See the full checklist here (German only).
Social Venture Fund
Social Venture Fund supports social businesses that have already proven to be successful in their market and aim to expand.
- The ideas should have a clear social impact
- There should be a sustainable business model in place
- The business model should be scalable
For more detailed information, visit their website.
Climate- KIC Accelerator
Climate- KIC Accelerator accelerates development to help create investable business start-ups, with products or services delivered to the first client in about 12-18 months. The Climate- KIC Accelerator enables entrepreneurs to move through three stages: starting with an idea and finishing with a clean tech venture.
Stage 1: Fundamentals (takes up to six months)
- Needed: a breakthrough idea related to new technology with a substantial climate impact.
- Team is working on business model
- Climate-KIC provides a business coach, access to a master class and up to 20,000 EUR
Stage 2: Validation
- Needed: Proof of concept- meeting 50 potential clients to verify business model
- Climate- KIC provides access to master classes, up to 25,000 EUR and the opportunity to enter venture competition.
- Coach will still be available
- Result: comprehensive business plan, financial model and customer research.
Stage 3: Delivery
- Secure customers
- Look into scaling
- Meet investors
- Climate- KIC provides you with pitch training sessions and the opportunity to enter venture competition, as well as up to 50,000 EUR.
For more detailed information, visit their website.
Tengelmann Social Ventures
Tengelmann Social Ventures GmbH is a seed investor, investing in social businesses that are in the early stages. At the same time, growth investors maintain the possibility to support these social startups at a later phase, and continue to help them grow successfully. The focus lies on e-commerce and internet technologies that work with education, disability, and improving quality of life. They are also interested in offline social technology models.
- Idea should have a clear social impact
- Business model in the fields of education, disability and/or improving quality of life
- Full commitment by founders
- Business model should be sustainable and not based on donations or CSR contributions
For more detailed information, please visit their website.
Startnext is one of the most used crowdfunding platforms for social startups in Germany. It's also the largest crowdfunding community for creative projects in the German speaking area. Filmmakers, musicians, journalists, designers, artists, inventors, founders, and other creative people present their ideas on Startnext in order to fund them through the direct support of the crowd.
- Clear project goal
- Funding goal
- Crowdfunding video
- Gifts for supporters
There are LOTS of crowdfunding platforms out there, we recommend finding the one that best suits your industry. This is a great list of crowdfunding platforms, both in Germany and internationally. Visit this Crowdfunding website to find out more.
Depending on when you look, there are also quite a lot of competitions happening that might be relevant for your endeavor.
Here is one that happens on an annual basis:
Act for Impact
Act for Impact is one of Germany’s largest funding competitions for social entrepreneurs in the area of education and integration. The Social Entrepreneurship Akademie and Vodafone Stiftung offer 51.000 Euros to get your social project started.
- Have an idea that has a clear social impact
- Project should address the topic of education and integration of young people up to 25 years.
The call for applications is usually around February. I
In order to stay informed about upcoming competitions, please visit our “resources” page.
Originally published June 20, 2014