Fractional CFO services in Germany

INVEST grant for venture capital

Federal angel scheme run by BAFA. Refunds private investors 25% of their ticket (up to €500k of investment per year) when they back qualifying young, innovative companies. The closest German equivalent of the UK SEIS/EIS regime and a meaningful driver of structured angel rounds.

Forschungszulage (R&D allowance)

Federal R&D tax allowance, introduced in 2020 and expanded in 2024. Refunds 25% (35% for SMEs) of qualifying R&D personnel costs and contract R&D, capped at €2.5M of base per year for most companies. Paid out as a credit against tax liability or refunded if loss-making.

High-Tech Gründerfonds

High-Tech Gründerfonds is Germany's largest seed investor, backed by the federal government, KfW and a consortium of corporates. Typical ticket €600k–€1M at seed, with strong follow-on participation. Most German tech seed rounds either feature HTGF directly or compete with HTGF terms.

KfW Capital and ERP-backed loans

KfW is the federal investment bank. KfW Capital invests in German and European VC funds as an anchor LP; the ERP-Startfonds and ERP-Gründerkredit provide subsidised loans to early-stage companies. Most active German VC funds carry KfW Capital in the LP base.

Venture debt

Less developed than the UK or US market but functional. Deutsche Handelsbank, HSBC Innovation Banking, Kreos and Claret Capital Partners are the main providers active in Germany. Typically deployed post-Series A against ARR or contracted revenue.

EXIST and university spinout grants

The federal EXIST programme funds research-stage university spinouts with stipends (EXIST-Gründerstipendium) and grants for tech transfer (EXIST Forschungstransfer). Used heavily by deeptech and biotech founders coming out of TUM, RWTH and Fraunhofer-affiliated research groups.

VSOPs (virtual stock options)

Virtual Stock Option Plans - phantom equity that pays the employee a cash bonus on a liquidity event equal to the value of a notional option. Dominant in German startups because they avoid the tax-on-exercise problem entirely. The employee is taxed as employment income at the exit event, not at grant or vesting.

§ 19a EStG real stock options

The Zukunftsfinanzierungsgesetz (in force from 2024) expanded § 19a EStG, allowing real options in qualifying SMEs to defer taxation until sale (or up to 15 years post-grant). Available to companies under 1,000 employees and €100M turnover. Still less prevalent than VSOPs but the gap is closing for newer companies.

Direct equity (real shares)

Direct grants of GmbH shares are technically possible but rarely used at scale - every transfer of a GmbH interest requires notarisation, which is slow and expensive. Stock corporations (AGs) handle this more cleanly, which is one reason later-stage German startups sometimes convert from GmbH to AG ahead of major equity programmes.

Hurdle shares (Hurdle-Modelle)

Separate share class with a hurdle value, structured so the holder only participates in returns above that hurdle. Used selectively for senior hires at later stages where the ordinary option strike would be punitively high. Requires careful drafting under German company law.

ESOP valuation

Most German startups peg option or VSOP strike values to the price of the most recent funding round. For § 19a real options, an independent valuation may be required to set the tax-relevant fair market value at grant. Standard practice is to refresh the valuation at each priced round.

Reporting and payroll integration

VSOP payouts run through the regular payroll (Lohnsteuer) at exit and require coordination with the Steuerberater. § 19a deferred options need annual reporting until the tax event triggers. Both are areas where founders routinely miss filings unless the CFO and payroll provider are aligned.

Accounting

• •DATEV - the universal German standard; every Steuerberater works with it.
• •sevDesk or Lexware - modern alternatives for small SMEs and freelancers.
• •NetSuite - for late-stage companies needing multi-entity consolidation.

Payroll

• •DATEV Lohn - the default, especially when the Steuerberater runs payroll alongside accounting.
• •Personio - German HR platform with integrated payroll; common at 30+ headcount.
• •Deel or Remote - for hiring contractors and staff outside Germany.

Business banking

• •Qonto - for VC-backed startups (Qonto acquired Penta in 2022).
• •N26 Business - for early-stage simplicity.
• •Commerzbank, Deutsche Bank or Sparkasse - for traditional debt facilities and treasury.
• •HSBC Innovation Banking - for venture debt and growth lending.

Cap table & equity admin

• •Ledgy - strong DACH coverage; handles VSOP and § 19a workflows.
• •Pulley - used by German companies with US investors or entities.
• •Carta - common at later stage and for international cap tables.

Expenses & corporate cards

• •Pleo - European default; clean DATEV sync.
• •Moss - German-built, strong German tax and accounting integrations.
• •Circula - alternative with deeper travel and per-diem features.