1. Form of funding
In consultation with the enterprise and any other investors, DOEN Participaties decides which form (loan, convertible loan, equity investment or guarantee) best suits the phase in which the company is operating. For example, a loan could be chosen to prevent DOEN from gaining an over-dominant position as a shareholder in the company and thereby demotivating the founders.
a. Which form of funding fits best?
b. Under what conditions?
2. Shareholders and other investors
In principle, DOEN Participaties requires a co-investor in order to spread the risk and validate the business model. The commitment of existing shareholders is also important. In this respect, DOEN Participaties looks at whether they also endorse the sustainable and/or socially inclusive mission. If there were sufficient other funders willing to invest in a company, an investment by DOEN would not be logical (point 3.a). DOEN Participaties focuses mainly on those initiatives that are relatively difficult to fund due to a high-risk profile. Follow-on investments are an exception to this.
a. Who are the current shareholders, and what importance do they attach to the sustainable and/or socially inclusive mission?
b. Is there a co-investor? Who is the co-investor? How much is invested and for what purpose?
c. How much do other investors contribute and under what conditions?
d. What are the supervisory, decision-making and controlling roles of shareholders?
3. Valuation and DOEN’s stake
DOEN Participaties also looks at whether the valuation (if applicable) is realistic and what stake DOEN acquires through an investment. In principle, DOEN strives for a minority stake, but may depart from this if it serves DOEN’s objectives. DOEN is a funder and does not intend to manage equity investments itself. In order to protect its minority stake, DOEN will define in shareholder agreements how its interests as a minority shareholder are adequately protected. This may be in the form of blocking rights and appointing a member of the Supervisory Board.
a. What valuation is realistic and under what valuation will investments be made?
b. What stake will DOEN Participaties get?
c. How will our stake be protected in the future?
d. Does DOEN have a decisive say on issues that are important to it, such as social commitment and/or mission, the joining of new shareholders and financial sustainability?