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Business Angels unite!

July 14, 2017
Early May this year the Dutch minister for economic affairs Henk Kamp announced plans for the subsidy scheme for the benefit of early stage (techno) start-ups. The scheme came into effect on July the 1st as the SEED Business Angel regulation’.

As of Monday the 3th of July it is possible for SEED Business Angel Funds’ to request an interest free loan of up to a maximum of EUR 1,000,000 from the NEA (Netherlands Enterprise Agency or Rijksdienst voor Ondernemend Nederland) to match their own investment.

The scheme is meant to help finance early stage (techno) start-ups by subsidising the investment of selected angel investors in early stage (techno) start-ups. Traditionally these risky early stage investments have been the territory of angel investors. The SEED Business Angel regulation hopes to stimulate (and enable) angel investors to provide more money to early stage (techno)start-ups by sharing the risk while offering the angel investors very favourable repayment conditions.

Initially the angel investors are entitled to 80% of the revenue up until the moment that the business angels’ contribution to the investment has been fully repaid. After this period the business angels and the NEA are both entitled to 50% of the revenue until the total investment has been repaid. Thereafter, 80% of the revenue goes to the angel investors once more.

The regulation also hopes to help professionalize the Dutch angel investors market. Qualifying SEED Business Angel Funds consist of two angel investors (no more and no less) that have an equal interest in the fund. While the specifics of the subsidy conditions are different in some ways its technicalities are in many ways comparable to the existing SEED Capital regulation.

One important difference is that the SEED Capital regulation is tender based, whereas the SEED Business Angel regulation is open to applications until its EUR 10,000,000 budget has been spent or until the 31st of December 2017, whichever comes first.

As the maximum budget per grant is EUR 1,000,000 per Angel Fund there are at least 10 grants available. Already have a business partner in mind and interested to know more? Contact us for more information on the regulation or for assistance in setting up your Angel Fund.