German Investors Turning To Social Networks

    June 19, 2008

Private investors and venture capital firms in Germany are looking to social networks when they make investments according to a study.

Angel investors, who usually invest their own funds, said about 41percent of their capital goes towards social networks, a study of 539 investments in 2008 of 49 investors, and venture capital firms revealed.

Venture capital firms on average put 30 percent of their money into social networks, according to the study done by German online magazine deutsche-startups and trade publisher iBusiness.

A spokeswoman said the investors did not reveal the amount of money they invested in social networks.

Both venture capital firms and angel investors put around 20 percent of their funds into ecommerce and service providers, but used different strategies for mobile technology and games.

Venture capital firms used about 7 percent of their funds to invest in mobile and games, while angle investors used 1 percent of their capital.

The study found, Holtzbrinck Ventures and its subsidiaries along with Burda Digital and the European Founders Fund to be Germany’s major venture capitol investors.

Olver Jung, who started IT company Entory AG, and Lukasz Gadoski, founder of online t-shirt company Spreadshirt, was the top angel investors.