Seed / Pre Seed

Capital is a prerequisite for growth. Unfortunately, many startups start raising capital too late, and many do not raise enough to take the company from startup to growth business.

At Deloitte, we are experts in advising on capital raising and have in-depth knowledge of the various forms of investment that can be included in the overall capital structure. We assist with:

• Liquidity overview
• Timing of capital contributions
• Composition of capital
• Assessment of alternative financing options such as soft funding, tax credit schemes, venture debts, etc.

Once the capital structure has been determined, we will help you lay out the strategy for how the capital is raised in the most appropriate way.

Together, we review every element of the capital structure and help with everything from material preparation to the actual capital raising.

Dilution of the founding team is a major challenge for companies that raise capital at the seed stage. At Deloitte, we can help you keep as large an ownership stake in your company as possible. Therefore, we offer advice in the following areas:

• Optimal distribution between equity financing and debt financing
• Start-up loans, growth loans, BA matching loans and venture debt
• Operating and liquidity budgets
• Negotiation meetings.

At Deloitte, we have extensive experience with developing budget models that match your business. When we help with budgeting at the seed stage, we have a special focus on the company’s liquidity needs, because this helps you manage the need based on the growth goals you have set.

We prepare the budget model in accordance with the taxonomy from The Danish Financial Statements Act, so that it can be compared with the official annual accounts. This is not just good budget practice. It also facilitates reporting for the company’s other stakeholders.

At the seed stage, we help to prepare a shareholder or founder agreement that describes the division of roles and responsibilities between the founder and the other company management. The agreement may also contain rules on:

• transfer of relevant property rights
• transfer of shares
• non-compete, drag-along and tag-along clauses
• clarification of earnings models: How are shares earned? Is the founder obliged to sell their shares if they leave the company? And if so, at what price? Exit scenarios and buy-outs are taken into account here.

At Deloitte, we have a team of legal professionals with special expertise in advising startups and growth companies. Here we use our broad experience and deep business understanding to help fast-growing companies in all phases of their life cycle – all the way from startup to IPO to exit.

Among other things, we provide legal advice on:

• Funding strategies
• Assessing financial options
• Drafting and negotiating term sheets for growth financial deals
• Investment agreements
• Shareholders’ agreements
• Security documents
• Exit strategies
• Loan agreements
• Venture capital financing
• Venture debt agreements
• IPOs and other transaction documents
• GDPR compliance.

Even if your business is at an early stage, it is important that you focus on your tax position at this point. We help you establish the optimal tax strategy and advise on how, as a founder, you can handle your personal tax matters so as to pay the right amount of tax – but not more.

In relation to the annual tax return, we advise on the option of benefiting from the tax credit scheme or the so-called section 8 X of the Tax Assessment Act. The scheme is often relevant for many companies in the start-up phase.

The tax credit scheme gives companies with expenses for research and development the opportunity to apply for payout of the expenses’ tax value. However, this is assuming that, in terms of tax, the joint taxation entities have had a deficit in the current income year.

Is your startup or scale-up unable to pay attractive salaries on normal market terms? Then a warrant program is your opportunity to attract, retain and motivate key employees with a decisive influence on the continued growth of the company.

A warrant is a security that gives the employee the right to purchase a certain number of shares in the company – at a certain price – within a certain period.

By creating a warrant pool, traditionally set to 10% of the fully diluted share capital, it is possible to implement a warrant programme and grant warrants, which are subsequently allocated to key employees.

The creation of a warrant programme is a complex exercise because the legal area of the programme is regulated by the Danish Stock Options Act, and because important considerations related to tax and employment law must be taken into account.

At Deloitte, we are ready to help design, prepare and implement both Danish and international incentive schemes and warrant programmes. We also advise on valuation and optimisation of warrant programmes.

Financial overview is the way to motivation and increased focus on the company’s growth goals. That is why we offer a solution where we deliver a report every month, providing insight into your financial results and key metrics such as MRR, Churn, LtV, CAC, Cash in hand and Runway.

The solution is linked to e-conomic and thus delivers real-time data based on the company’s financial system, while input to the company’s metrics is provided every month.

With just a single click, you get a monthly report that contributes to important insights and gives rise to valuable dialogues with stakeholders.