NETHERLANDS Law and Practice Contributed by: Marc Habermehl, Jeroen Smits, David de Groot and Max de Heer, Stibbe
Offering to non-professional investors Additional requirements apply if an AIFM offers units to non-professional investors exclusively, or to both professional and non-professional investors, and manages (one or more) alterna - tive investment funds whose total assets under management: • are less than or equal to EUR100 million; or • are less than or equal to EUR500 million, in the case of a manager managing funds that do not use leverage and that are closed-end - ed for the first five years. To fall under the registration regime, these man - aged units can only: • be offered to fewer than 150 persons; and/or • be acquired for an equivalent value of at least EUR100,000 per participant, or have a nomi - nal value per right of at least EUR100,000. If these requirements are met, the AIFM is exempt from the licensing regime but is required to register under the registration regime. 2.4 Particularities See the Dutch Trends and Developments chap - ter in this guide. 3. Investments in Venture Capital Portfolio Companies 3.1 Due Diligence Due diligence is an essential element prior to committing to any investment, and this is also the case for VC investments. There is, however, a difference between the due diligence inves - tigation typically conducted in a mature com - pany’s buy-out transaction compared to such investigation into a start-up or growth company.
The due diligence conducted by VC funds is generally less extensive. An obvious reason for this is that young and growing companies gener - ally have a smaller workforce and less complex - ity compared to mature companies with a long history. In other words: there is less to investi - gate. Depending on the type of business, dili - gence typically focuses on key value drivers for the venture (eg, on intellectual property, permits/ licences or certain material commercial agree - ments). Another relevant element in the due diligence phase is that the investor will invest in the com - pany and – unless there is also a secondary ele - ment – the founder and other shareholders of the company will not yet take their money off the table. Although this does not remove the need for proper due diligence, it does provide comfort to new investors. In 2020 and 2021, the VC market was boom - ing, and investors were eager to allocate their money and anxious to not miss out on the next unicorn in town. This led to a highly competitive market that drove extremely short due diligence timelines (sometimes even a week or less). Also, presumably due to high interest rates, the uncertainty in the global economy and the geo - political landscape since 2022, this investment climate became less competitive, and investors have been able to take somewhat more time in conducting proper diligence of their potential targets. 3.2 Process See 3.1 Due Diligence .
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