VCVerträgen

VC-Verträge are the legal documents that govern equity investments by venture capital firms in startups. They define the terms of the investment, the protections afforded to investors, and the governance rights that accompany funding rounds.

A typical process begins with a term sheet outlining the main commercial terms, such as the investment amount, valuation, and type of shares. If agreed, binding documents are prepared, including a subscription agreement and a shareholders’ agreement.

Common terms include the share type (typically preferred), pre- or post-money valuation, liquidation preference, anti-dilution protection, and conversion mechanics. Governance provisions cover board composition, observer rights, and protective provisions for major actions, as well as drag-along and tag-along rights. Founders may face vesting and an option pool.

The documents set information rights, closing conditions, and warranties. Ongoing governance may require regular financial reporting and adherence to reserved matters. Transfer restrictions and planned exit pathways also shape liquidity events and secondary sales.

Regulatory considerations include securities laws and disclosure requirements, with EU and German rules adding minority-protection and corporate-governance requirements. Cross-border VC-Verträge must align with the chosen corporate form and applicable jurisdictional rules.