The 200M Fund is a Matching Fund that aims to foster Co-investment in high growth innovative startups in Portugal with qualified national or international private Co-investors.
Attract international entrepreneurs and startups to Portugal.
Attract qualified funds and corporations to invest in Portuguese market.
Promote cross-border investment between Portuguese and international investors.
Increase Venture Capital activity in Portugal through the mobilization of experienced investors which, in addition to the financial investment also allow companies to acquire technical, commercial and market know-how, thus enabling the development of better strategies to foster innovation, growth and internationalization.
Stimulate the incorporation or capitalization of companies, especially those in the early stages (seed, startup, later stage venture – series A and B).
Direct financial commitment of the 200M Fund in companies, with Co-investment and risk sharing with private Co-Investors.
The Investment by the 200M Fund and Co-Investors shall be made simultaneously and under the same terms and conditions. It requires a Shareholders Agreement/Investment Agreement between the Beneficiary Company, the Co-Investors and the 200M Fund, establishing the relationship framework between all parties.
Venture Capital investment in Portuguese companies in different stages (seed, start up, later stage venture – series A and B) for the development of new products/services or innovative projects regarding processes, products or marketing.
In companies certified as SME (as defined in Commission Recommendation no. 2003/361/EC of 6 May), to develop investment projects in the Northern, Central, Alentejo, Lisbon and Algarve regions.
Direct investment in SME via equity or quasi-equity (no in kind investments) and/or debt (up to 30% of total investment).
Minimum of € 500.000 and maximum of € 5.000.000 per company, and must be equal to or less than the total financial commitment from the Co-investors.
Eligible investments in SMEs shall be made by 31 December 2020. This deadline may be extended after authorization from each of the Fund’s public participating entities, together with each of the Operational Programs via the relevant ESIF.
Privileged sectors: Life Sciences, Biotechnology, IT and Digital, Tourism, Engineering and activities under the scope of the Industry 4.0 concept
See here the list of the eligible CAE.
Applications for co-investment shall be submitted by private Co-Investors in an open scheme, via an electronic form, being analyzed in order of reception.
National or international Venture Capital investors and other entities and persons legally accepted to invest in companies in Portugal.
A Co-Investor will act as the preferred contact for the Fund Manager, by submitting not only his own information, but also the information required for the beneficiary and other Co-investors, if applicable.
The Co-investor who acts as the preferred contact will also be responsible for reporting (financial statements, reporting templates, follow on meetings, etc.) to the Fund Manager on behalf of all Co-investors and Beneficiary Company, as well as any other issues that may arise in the future.
In order to invest in partnership with the 200M Fund, the co-investor may not have used other instruments of a public nature neither received funding from the European Structural and Investment Funds (FEEIs).
To apply to the 200M Fund, the Co-Investor should click “Apply Now” on the website, fill in and submit the online form. The application form can only be submitted after all required fields are filled in and all documents are uploaded.
In the following link you can find the forms which must be fully filled in to be able to submit the application.
All terms and conditions must be complied and able to be shown prove if required during the application analysis or while following the investment.The terms and conditions can be find here.
Applications shall be assessed based on the following criteria:
- Co-Investors’ experience and track record in venture capital activities and in the 200M Fund’s preferred areas;
- The project’s target/sector;
- Volume of investment in companies;
- Weight of private investment regarding the total proposed Operation;
- Number of jobs created;
- Number of partners involved in the Investment Operation (incubators, accelerators, other investors);
- Project’s ARR;
- Introduction of innovative products / services;
- Project’s expected IRR.
In the following link you can find more details about the 200M Fund Eligibility and Selection Criteria for Co-Investors and Beneficiary Companies.
The 200M Fund Investment Committee will assess the Co-Investors and Beneficiary Company, evaluating its merit, positively or negatively, based on the analysis made by the Fund Manager.
Only applications that the Investment Committee considers to have merit regarding both Co-investors and Beneficiaries/Investment Projects (cumulatively) will be approved for Co-investment by the 200M Fund.
See here the indicative check list of documents.
In respect of corporate legal persons, beneficial owners are the natural persons who hold a significant control of or interest in said entities, when the latter are not listed in a regulated market exchange with information disclosures similar to the ones of the European Union Regulations, or subject to similar international regulations which ensure sufficient information transparency regarding its property structure, in particular, the following:
- Individual or individuals which are the ultimate owners or have direct or indirect control over sufficient percentage of stocks, voting rights or any stake in a corporation;
- Individual or individuals which have control, by any other means, of that corporate entity;
- Individual or individuals who hold top management positions, if, after all other possible means have been used, and on the condition that the transaction or entity’s activity is not deemed suspicious:
- No other individual was identified by any of the previous means; or
- There are still doubts that the identified individual or individuals are in fact the actual beneficial owners.
Please note that for the purpose of assessing the quality of beneficial owner, when the client is a corporate entity:
- It should be considered as a sign of direct property when an individual holds a stake of more than 25% of the clients’ equity;
- It should be considered as a sign of indirect property when there is a stake of more than 25% of the clients equity hold by:
- A corporate which is controlled by one or several individuals; or
- Several corporates which are under control by the same individual or individuals.
In respect of trusts, non corporate legal persons (such as foundations) or legal arrangements similar to trusts (such as venture capital funds), the beneficial owners of such entities are:
- The settlor, when applicable;
- The trustees, when applicable;
- The protector, if any;
- The beneficiaries, or where the individuals benefiting from the legal arrangement or entity have yet to be determined, the class of persons in whose main interest the legal arrangement or entity is set up or operates;
- Any other natural person exercising ultimate control over the trust, legal person or legal arrangement by means of direct or indirect ownership or by other means.
200M Fund grants a call option to Co-Investors that can be exercised during the first four years from the date of the investment:
- If the call option is exercised by the end of the 2nd year, an IRR of 4% must be ensured for the investment made by the Fund;
- If the call option is exercised between the 3rd and 4th year, an IRR of 6% must be ensured for the investment made by the Fund; or
- If the Investment Operation is made in the Life Sciences sector indicated in subparagraph (h) above, the call option may be exercised until the end of the 4th year, ensuring a 4% IRR to the Fund, or between the beginning of the 5th and end of the 6th year, in which case an IRR of 6% must be ensured.
The aforementioned IRR shall be calculated as follows:
The Co-Investor who acts as the preferred contact will receive a notification justifying why the application was not approved and the application process is concluded.
It is possible to re-submit the application with the issues that did not allowed for its approval amended. This will begin a new assessment and, hence, it will be treated as if it is a new application.
After the application approval and, the Co-Investor who acts as the preferred contact is notified, the Investment Agreement and the Shareholders’ Agreement are signed.
In case the Beneficiary Company is not yet created, the 200M Fund Manager will notify the Co-Investor who acts as the preferred contact to let him know that they should create it and submit the following information:
- Declaration of beginning of activity;
- Declaration from the Tax Authority and Social Security mentioning there are no debts outstanding; and
- SME certificate.
In order for the 200M Fund Manager to transfer the funds to the Beneficiary Company, it will have to receive an evidence of the Co-Investors transfer (bank statement of the Beneficiary Company).
In the modern day world, financial entities are called upon to ensure that proceeds arising from or in connection with or destined to criminal or suspicious activities are not placed, circulated in or integrated the financial system, for the purpose of avoiding that the executors of such criminal activities from benefiting of or continuing their unlawful operations.
For this reason, and even though neither Co-investors nor the Beneficiary Companies are clients of PME Investimentos (the company managing the 200M Fund), it has been established that failure to comply with the market and legal standards applicable in this respect shall entail the immediate rejection of the respective application.
In view of this, it is of the utmost importance that the KYC forms provided with the application form are duly filled in and signed and are uploaded to the application platform together with the requested documentation.
Should you have any additional query in what concerns this issue, please feel free to contact us at PME Investimentos.
See here the KYC forms which must be fully filled in to be able to submit the application.