Companies can apply to the Venture Capital fund for financing. The starting capital lies around €200,000, in exchange for shares. The average investment is between 1 and 3 million euros.
How it works
A Venture Capital fund receives hundreds of applications per year. It only selects the most promising proposals. The fund's main aim is to generate a return on investment (ROI) for its participants. To achieve this, they are looking for your company's shares to increase in value over time. And they will sell their shares on to companies or other financiers in 3 to 7 years' time, to realise the ROI. This is their exit strategy. The capital managed by Venture Capital funds is also called private equity.
Applying for funding from a Venture Capital fund
If you are planning to approach a Venture Capital fund, it is essentail that you learn how they assess and invest. Investors like to see that you can understand their position and view the proposal from their perspective too. Later in the process, negotiations and contractual agreements play an important role. It is wise to hire a professional to help you in this phase.
Do you want to know which Venture Capital funds are active in your sector or industry? Check the list on the website of the Netherlands Venture Capital Association (Nederlandse Vereniging van Participatiemaatschappijen, NVP) for an overview of all their members.
Increase your chances of success
Investors prefer to invest in companies that are financially sound. Here are some checks you can do to increase your chances of a successful application for funding:
- Check the viability of your company.
- Is your solvency ratio positive?
- Can you pay the bills? Draw up a liquidity budget to find out.
- Do you and your team have all the expertise you need to run a successful business?
- Is your financing application complete?
Help in finding financing
There are several organisations (in Dutch) that can help you find financing.