Private equity and venture capital in The Netherlands

Written on 31 Jan 2017

Brexit effect – outlook for 2017

The Dutch M&A market was impacted by the Brexit decision in June 2016. However, Q4 2016 was quite strong in terms of M&A and compensated for some of the effects of Brexit. According to several studies, the number of transactions in the Dutch market for 2016 dropped with 10% compared to 2015. It is not yet clear whether the strong Q4 will continue into Q1 2017 or whether the negative impact of Brexit and/or unexpected outcomes of elections in Germany, France or the Netherlands will cause unrest again. Putting aside the potential for unrest, the two ingredients supporting M&A activity are: cheap capital and a lot of available cash for PE funds.

Dutch Seed Capital Scheme exceeds expectations

In 2016 the Dutch Ministry of Economic Affairs and private risk capital funds have provided EUR 65 million to support start-ups in innovative sectors such as IT, Energy, Healthcare, Food & Agriculture through using the so-called Seed Capital Scheme (Seed Capital Regeling). The Seed Capital Scheme has been established since 2005. Closed-end participation funds can qualify themselves if they invest in tech start-ups that meet certain conditions under the Seed Capital Scheme.  If qualified, the government will grant a loan under attractive terms (up to the maximum amount of EUR 6 million). The Seed Capital Scheme is hence highly interesting for both investors and start-ups.

The Dutch Ministry has opened a new tender period from 1 January 2017 through 31 March 2017 for another EUR 24 million for funds investing in start-ups and innovative companies in the Netherlands. A special budget of EUR 6 million will be available for investors in e-health tech start-ups.

Start-up trends in the Dutch market

According to market data, Dutch start-ups raised at least EUR 263 million of funding which is slightly less than 2015. It is worth mentioning that med-tech start-ups were well represented in the top 15 Dutch start-up investments of 2016. Fintech is also growing, particularly cyber security companies.

OC team in Amsterdam

In 2016 the team has been regularly involved in VC/PE transactions, both in the Dutch market and cross border transactions. The team advised PE/VC investors and strategic buyers, as well as targets and their selling shareholders, mainly in the sectors of digital business and life sciences and healthcare. We also saw a lot of interest in fintech and expect the fintech sector to further grow in 2017.

The OC corporate team in Amsterdam continues to expand rapidly. In 2016 seven lawyers joined the team, including Geoffrey Beurskens (a senior associate with extensive experience in advising start-ups/growth companies in respect of VC deals and M&A transactions) and Johannes de Jong (who previously worked at the Dutch regulator, Authority for the Financial Markets).  Johannes joined as head of Amsterdam’s Financial Regulatory practice and broughthis extensive experience in payment services, fintech and crowd funding as well as funds and infrastructures.

The team is able to offer clients full services on all legal aspect of their deals. In 2016, the Amsterdam corporate team has been able to add an impressive number of well-known investors, ‘start-ups’ and ‘grow ups’ to its existing client data base in a limited period of time.