US instruments and their Dutch equivalents
- SAFE → convertible loan: the discount, the cap and the conversion triggers are written into a loan. The loan is converted into shares at the next round. Investors can sign it quickly and know how to price it.
- Priced round → notarial share issue: the new shares are issued by notarial deed. The shareholders’ agreement contains the preferences, vesting, drag-along and tag-along rights, and information rights.
- Option pool → plan plus certificates: with Dutch certification, the economic rights and the voting rights are held separately. See stock options for US founders.
What US funds check on a Dutch target
US funds check three things. First, a simple cap table in the shareholder register, which the board of the BV keeps at the company’s address (the registers). Second, intellectual property that the company can prove it owns (the IP position). Third, a structure that suits their exit. Under the participation exemption, the gain is tax-free when a Dutch holding sells a subsidiary (how a holding company works).
Cross-border dividends and exits
Dividends and exit proceeds paid to US investors are taxed under the tax treaty. Portfolio investors pay 15%, and qualifying corporate investors pay less. See the treaty guide. Funds that prefer a US top company can invest after a flip, or invest directly in the BV before a flip. See the reverse flip. Both options are common.
Does your company want its European entity in the Netherlands? See setting up a Dutch subsidiary for the steps, the costs and a comparison with other countries.
Your own position as a founder
As a founder, you fall under the rules for a director and major shareholder (DGA). This is the standard position of a founder who manages their own BV. You pay yourself a salary at the benchmark level and choose when to pay dividends. If the BV is just starting and still has too little money for that salary, a lower salary is allowed for up to three years. See DGA salary for US owners.