POLAND Trends and Developments Contributed by: Rafał Celej, Arkadiusz Klejnowski and Karolina Piotrowska-Andryszczyk, Kondracki Celej
May 2025 with a total capitalisation of EUR140 million. The initiative is a joint effort of Poland’s Ministry of Finance, the Polish Development Fund (PFR) and PFR Ventures. It is designed to support investment in advanced technologies such as robotics, cybersecurity, quantum and space technologies, with particular emphasis on dual-use applications. The capital will be allo - cated to three to five specialised VC funds, with the aim of financing 50–80 projects developing deep tech solutions. Transactional Trends and Structuring Transactional practice in Poland has evolved considerably, particularly at the later stages of the investment life cycle. Shareholders’ agreements (SHAs) have become increasingly detailed, reflecting both investor protections and founder alignment provisions. These agree - ments now incorporate a range of contractual tools to balance risk and incentives for all parties involved. Key features now typically include: • weighted-average anti-dilution protection, which adjusts the investor’s share price downward in future dilutive rounds, providing economic protection if shares are issued at a lower valuation; • 1x non-participating liquidation preference, granting investors the right to receive their original investment before any proceeds are distributed to common shareholders, without further participation in upside; • drag-along and tag-along rights, which respectively allow majority shareholders to compel minority holders to sell in an exit event and permit minority holders to join in a sale on the same terms; • reserved matters, requiring investor consent for critical corporate actions such as changes
to share capital, business scope, or M&A transactions; and • governance rights, including the right to appoint a supervisory board member or observer and receive regular financial and strategic reporting. Convertible instruments such as convertible loan agreements (CLAs) have gained popularity in early-stage and bridge financing transactions. These allow investors to inject capital on a short timeline while deferring valuation negotiation. VC rounds are still predominantly closed in the form of capital increases within lim - ited liability companies ( spółka z ograniczoną odpowiedzialnością ), which remain the most commonly used legal vehicle for start-ups. These transactions typically require notarial resolutions and subsequent registration with the National Court Register (KRS). Due diligence processes have also become more efficient. While still limited in scope com - pared to private equity transactions, they typi - cally cover key areas such as cap table struc - ture, intellectual property ownership, financing documents, and any public aid received. This phase of the process usually lasts between six and eight weeks and is conducted on a red-flag basis, enabling a faster path to signing while flagging key legal risks for negotiation. The Role of Public Capital One of the most defining characteristics of the Polish venture capital market is the active pres - ence of the public sector, not only as a passive backer but as a strategic architect of the local fund environment. Unlike in many Western juris - dictions where LP capital is primarily institutional or private, in Poland public actors remain critical to both fund formation and deployment.
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