The Bavarian Investment Company (BayBG) invested approximately €45 million in medium-sized companies and startups in Bavaria in the 2023/24 financial year. Compared to the previous year, with an investment volume of approximately €75 million, this represents a significant decline. Nevertheless, a net profit of €9.4 million was achieved – a significant increase over the previous year's result of €5.1 million.
Loud Peter Pauli, Managing Director of BayBG, considers the investment level a "solid result" given the current economic and geopolitical conditions. He explains:
"The structural crisis Germany is currently experiencing is causing medium-sized companies to act very cautiously and postpone major investments. This is leading to a decline in the need for venture capital."
The SME/Growth division, traditionally the investment company's strongest area, was particularly affected. Here, the investment volume fell from €43.7 million in the previous year to €22 million in the current fiscal year.
Succession, startups and turnaround areas stable
While investment in SMEs declined, other areas remained relatively stable. Investment solutions in the context of business successions accounted for €10.2 million. BayBG invested €7.6 million in startups, young companies, and start-ups. Venture CapitalA further 2.7 million euros went to small and young companies, and 2.5 million euros to companies in special situations within the turnaround area.
With new investments of EUR 45 million, BayBG remained below its planned EUR 58 million for the 2023/24 financial year. Peter Herreiner, also Managing Director of BayBG, says:
"More new business would have been easily possible in the past fiscal year, but we apply very strict standards to our investments in order to fulfill our responsibility to entrepreneurs."
BayBG is optimistic about the future
The balance sheet volume of Bayerische Beteiligungsgesellschaft grew to EUR 453.5 million in the 2023/24 financial year, and equity rose to EUR 278.7 million (as of September 30, 2024). In total, BayBG holds investments in 457 Bavarian companies with over 40,000 jobs. Pauli looks optimistically into the future:
"Despite the current tense situation, we are quite confident about the future in the medium term. Bavaria is an economically and technologically strong region and continues to offer many entrepreneurial opportunities."
Herreiner added:
"In the medium term, high-growth and innovative companies need equity capital to realize even larger development steps and to be able to implement them on a solidly financed basis. Through our minority investments and mezzanine capital, medium-sized companies receive optimal offers to strengthen their equity base and realize growth."
