The german venture capital market

Abstract

German venture capitalists are facing challenges due to macroeconomic factors and current geopolitical dynamics. Through a systematic analysis of the literature and interviews with German venture investors, this paper investigates how investment instruments and valuation methods of German venture capitalists are adapting to macroeconomic factors in an uncertain market environment. Results indicate that convertibles are favored over other instruments in the current environment in Germany. The influence of these macroeconomic factors varies for valuation methods and portfolio valuations. The results suggest that past crises have also affected venture capital firms' investment instruments, portfolio valuations and valuation methods.