Start-up grant Duration

Duration of the start-up grant

The start-up grant, once applied for and approved, is valid for a period of six months in the first phase. During these six months, founders receive the start-up subsidy in the amount of the unemployment benefit 1 received to date as well as a €300 social insurance subsidy.

Start-up grant: Duration depends on the respective phase

Not only does the application process change depending on the phase of the start-up grant, but also the duration.

In principle, the start-up grant is a state transfer payment that supports start-ups. The start-up takes place out of unemployment and, after successful approval, is supported with a six-month start-up subsidy (same amount as unemployment benefit) and an additional €300 social insurance subsidy in the first phase.

The difference between the phases
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    Bruno Schäfer

    Management consultant | Self-employment COACH | Business graduate

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    Step 1:

    Difference between 1st phase and 2nd phase of the grant

    At the end of the first funding phase, it is possible to submit a follow-up application. This follow-up application is aimed at the continued approval of the social insurance subsidy for a further 9 months.

    Overall, the maximum duration of the start-up grant is as follows:

    • Phase 1: Up to 6 months
    • Phase 2: Up to 9 months
    • So a maximum of 15 months
    • Only for ALG 1 recipients or entitled persons
    • Maximum of up to €18,000, depending on the amount of unemployment benefit
    • The subsidy does not promote success, but rather the attempt!

    But what exactly is the difference between the basis for approval of the first and second phase of the start-up grant?

    The start-up subsidy in the first phase serves to provide financial support or subsidize the private living costs of founders. It is assumed here that, especially at the beginning of self-employment in the so-called start-up phase, it is not yet possible to expect such high turnover or profits that founders can cover their entire living costs.

    The assumption is therefore that entrepreneurs who could run into financial difficulties in the first six months of their self-employment without the start-up grant will be supported.

    However, by the end of the six months of funding at the latest, your own business should be so stable or established that it is self-supporting and sufficient profits are generated to finance your own living costs.

    Phase two, and thus the continued granting of the social insurance subsidy for nine months, is a separate application that follows on from phase one.
    Bruno Schäfer
    Step 2:

    Phase two of the grant

    Phase two, and thus the continued granting of the social insurance subsidy for nine months, is a separate application that follows on from phase one. The conditions for granting the allowance are slightly different here compared to phase one:

    This is because the continuation of the social insurance subsidy is only granted if the self-employment covers the entrepreneur’s own living expenses as far as possible, i.e. sufficient profit is generated from the business to cover the entrepreneur’s living expenses in full. The benefits from phase two, on the other hand, are used to subsidize your own social expenses, e.g. costs for health insurance for a further 9 months. Consequently, you should not earn too much, but also not too little after 6 months. Experience has shown that the previous ALG 1 can serve as a guide. The two phases differ not only in terms of their duration, but also with regard to the formal requirements and framework conditions for submitting an application. You can find out exactly what these look like in a detailed overview in the chapter “The application” (click here).

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