Private Equity & Venture Capital
Debt Advisory also includes all activities related to raising risk bearing capital: Private Equity and Venture Capital. Private Equity (PE) firms seek existing enterprises requiring funds to invest or to expand. Venture Capital (VC) firms provide investment capital for start-ups and young companies.
In exchange for the investments PE and VC make in your company, the investors demand a return matching the risk they take, which will be higher than the average rate on bank loans. Their objective is to create more value than the company would when developing standalone.
An important difference with regular loans is that providers of PE/VC capital will gain a certain amount of control of the company, because they invest in exchange for company shares or convertible loans. The PE/VC investment leads to a temporary (5-10 years) collaboration for which the agreements are formally written down in a shareholders’ agreement. A number of specific agreements include an exit arrangement, drag and tag along clauses, and good and bad leaver situations that may have a financial impact on your position as an entrepreneur.
An important question is whether collaborating with a Private Equity firm suits your company’s culture and you as an entrepreneur. In addition to the economic rationale of a possible deal, we believe this is an important part of the decision.
Aeternus knows all Dutch PE/VC firms. We have created a large database with the following information for each PE/VC firm;
- Minimum and maximum investment amount
- Sectors in which is invested
- Investment phase (type of fund: VC or PE)
- Majority or minority participation
- Investment region
- Short-term and/or long-term investors
In addition, Aeternus has an extensive database of foreign, often sector-specialized funds, as well as access to international PE/VC firms through our partners in M&A Worldwide. This makes
us able to generate effective selections of suitable PE/VC firms for your particular deal.