Private equity firms
A private equity firm is a business that invests in investment vehicles such as pension funds and insurance companies. In addition to money, they also influence the policies of these organisations. Read how private equity firms work.
The money that private equity firms invest is called Private Equity. Some firms invest in startups or fast-growing businesses. These firms are usually called Venture Capital funds. Some Dutch provinces have their own private equity firms, known as Regional Development Agencies (ROMs).
Investment size
Private equity firms usually have a minimum investment of €1 to €2 million. Over 80% of all investments by private equity firms are under the €5 million mark. This means private equity firms are also interested in larger SMEs.
Influence and control
When a private equity firm takes a stake in a business, they actively contribute their knowledge and money. They expect the company to increase in value over time and contribute their resources to make this happen. Working together with the business owner, they try to take the business to the next phase. Private equity firms usually specialise in one specific phase or sector.
Government checks investments with risk to national security
Under the Investments, Mergers and Acquisitions Security Screening Act, (Wet Vifo), the government checks investments that pose a risk to national security. The security check applies to 2 types of companies in the Netherlands:
- Vital providers. These are businesses in sectors such as energy, water, financial infrastructure, and telecommunications, which are crucial to Dutch society.
- Businesses that possess sensitive technology. These are technologies that could pose a risk to national security, such as military goods, semiconductors, or quantum technology.
The security assessment applies to investments from all countries. If a party with hostile intentions gains (joint) control over your business by lending you money, this poses a risk to national security. Such a loan can be assessed.
Does your business have sensitive information or technology? Read more about the Vifo Act (in Dutch) and how it may affect you.
Dutch Association for Private Equity and Venture Capital
The Nederlandse Vereniging van Participatiemaatschappijen (NVP, Dutch Association for Private Equity and Venture Capital) represents 90% of all private equity and venture capital assets under management in the Netherlands. The NVP has about 70 members and has a useful overview of all their funds.
Seeking investors
When you go looking for finance, make sure to look closely at the required criteria. Use the financing flowchart to select an alternative form of financing that fits your situation.
Help with financing
Getting help increases your chances of financing. The right adviser and a good financial basis are important for a successful financing application.