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The highlight of the start year was: the COVID start-up relief fund. With € 50 million in government grants, it generated at least € 50 million more in private investment and was so coveted that the money was delivered much earlier than planned. Also with the effect that many young companies in Austria arrived too late and did not belong to the approximately 200 lucky companies that received the grants.
And even if the government said several times that there would be no new edition of the relief fund, it will soon be Christmas, and that is why the national startup sector can also make a wish. The wish is materialized in the demand for an additional 150 million euros for Part 2 of the financing instrument managed by the aws. Started Friday by business angels and startup founders, the online petition is now receiving strong support.
The new startup representative of the Chamber of Commerce, Kambis Kohansal Vajargah, also wants a new edition. To date, the petition has collected around 280 signatures.
Second block as reason
“The second lockdown and the associated prolongation of economic uncertainties necessitate additional support measures for financing sustainable capital for startups,” says AVCO (Austrian Private Equity and Venture Capital Organization). One would like to see 150 million euros in the second edition of the aid fund for the start of COVID. “Matching another 150 million euros of private funding would result in a volume of financing of 300 million euros for innovation and growth and thus creating jobs for the new Austria location,” he says.
The only question is whether the Treasury can even raise these 150 million euros: the startup sector is certainly not the only industry that is demanding new aid in the second lockdown. The other question is whether this is a smart investment for the state in the medium term. That is why it is argued that it is not money that is given away. “Designing as a reimbursable grant ensures that a large portion of the support money will flow back to the Republic of Austria,” says AVCO.
Refund in case of success
We remind: Grants that startups received from the COVID Startup Relief Fund must be repaid if they are successful. This is when the business is profitable or when it retires. Therefore, grants must be repaid if they are covered by an annual surplus for the next ten years. There is also a full refund obligation in case of sale (exit).
