POLAND Law and Practice Contributed by: Rafał Celej, Arkadiusz Klejnowski and Karolina Piotrowska-Andryszczyk, Kondracki Celej
Publicly-backed funds are bound by geographic and SME allocation mandates, as well as R&D alignment criteria. Funds that successfully com - plete these programmes often subsequently go on to raise fully private vehicles, relying on their existing track record and management infra - structure. Finally, the launch of FENG-backed funds in 2025 is expected to drive a new wave of early- stage activity, particularly in the AI, healthtech and industrial automation verticals, contributing to greater sectoral specialisation within the Pol - ish fund landscape. 3. Investments in Venture Capital Portfolio Companies 3.1 Due Diligence Due diligence conducted in Polish VC transac - tions is typically limited in scope and oriented towards identifying material risks rather than producing a full-scale audit of the target com - pany. The process usually results in “red flag report” focused on deal breakers, ie, issues that could significantly affect valuation, enforceability or post-investment stability. Key areas of the limited legal due diligence include: • confirmation of the title to shares and the cap table, including prior issuances, transfers and compliance with pre-emption rights; • confirmation of intellectual property owner - ship, including proper assignments from founders and key employees, which is par - ticularly critical in technology-driven targets; • review of public aid and grant funding, espe - cially where the company has benefited from NCBR or EU programmes – investors typi -
cally verify potential claw-back obligations, compliance with funding conditions or use restrictions; and • examination of existing contractual arrange - ments, with particular focus on key commer - cial agreements and employment structures. The due diligence phase is usually initiated fol - lowing the signing of a term sheet and can extend up to two months, depending on the company’s development stage, investor requirements and complexity of funding history. 3.2 Process A new financing round in a Polish growth com - pany typically begins with the negotiation of a term sheet. Once the term sheet is agreed, due diligence is conducted in parallel with the prepa - ration of investment documents. Most Polish start-ups are incorporated as lim - ited liability companies ( spółka z ograniczoną odpowiedzialnością ), and new financings are usually structured through the issuance of new shares offered to the investors. This requires a corporate resolution on the capital increase and adoption of the new AoA, with attention paid to anti-dilution rights, pre-emption rights and con - • investors subscribe for newly issued shares through a share subscription agreement (in a joint-stock company) or a declaration on join - ing the company and subscription of shares (in a limited liability company); • funds are transferred directly to the com - pany’s account, after the shares were sub - scribed by the investors; and • registration of the updated capital in the KRS must be filed following the shareholders’ sents of existing shareholders. From a procedural standpoint:
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