Venture capital companies
Venture capital companies normally have a fund that is supplied with capital from institutional and private investors. The fund volumes extend from 20 to 250 million euros, in exceptional cases even more. VCs invest this capital in startups and get a shareholding in the start-up for this. The amount of this share is determined by the company. In general, investors receive between 15% and 50% of the company shares in the seed financing phase. Risk capital investors take precisely calculated risks, always with an eye on the return on investment of their investors (pension funds, insurance companies, funds-in-funds, wealthy entrepreneurial families). They therefore call for control and participation rights as well as a high level of commitment by the founders and managers.
No less important than the level of the participation are the special rights of the investors associated with this. Thus there are numerous typical regulatory units in a shareholding agreement: Drag and Tag along rights, liquidation preferences, dilution protection, milestones, guarantees, liability regulations and many more. Max Planck Innovation is closely familiar with the legal and economic regulatory units as well as the market standards thanks to numerous negotiated shareholding and investment agreements. We are not entitled to give any legal advice, but we can accompany the negotiations with knowledge of the contract regulations typical in the market.
Max Planck Innovation has worked together with a large number of nationally and internationally prestigious VCs and keeps in regular exchange with them, amongst other connections.