Danube Angels for investors
What is the Danube Angels investor network?
The Danube Angels investor network was founded in 2017 with the mission to give everyone access to exciting investment opportunities in start-ups with moderate amounts starting from € 1.000 and thus support innovative business models and teams in Central Europe.
The basic idea of the network is simple: investments in early-stage companies are usually reserved for business angels or individual investors, as they make higher investments and thus have access to them. Through the Danube Angels investor network, several investors with manageable amounts join forces, gain access to promising companies and invest in these companies together, whereby each investor decides for himself in which company he would like to invest and which amount.
This means that demanding and risky projects can be implemented that a single investor would not support.
Why should you invest?
Without realising it, investors with balances in bank accounts/savings accounts/building society savings are slowly losing their wealth due to low interest rates coupled with current inflation. Therefore, it makes sense to consider other forms of investment with higher returns. Investments in company shares, such as those offered to the Danube Angels investor network, entail a number of risks that the investor must be prepared to bear. In any case, only a small part of the total assets should be invested. In addition, it is of particular importance to diversify the investment: five investments of EUR 1,000 are better than one of EUR 5,000!
Internationally, the expected return for this asset class is at least 25 to 35 percent per year. However, such a return can only be achieved with a diversified portfolio; the number of investments should not be less than ten.
The investor must also be able to cope with a total loss of the invested capital. Accordingly, the investment amounts should be chosen carefully and adjusted to the investor’s own financial situation.
Invest successfully even with small amounts!
In the past, only large investment funds and large investors had the opportunity to invest in forward-looking companies and multiply their invested capital.
Through Danube Angels, investors can also invest manageable amounts in business models that are otherwise not available at comparable conditions. With a minimum investment of EUR 1,000, everyone has the opportunity to build up an investment portfolio with promising companies and participate in their success.
Which companies are offered?
Danube Angels receives up to 100 applications per month from growth companies in the DACH region (Germany, Austria, Switzerland), Czech Republic, Slovakia, Hungary, Slovenia and Croatia.
From these applications, Danube Angels selects the most interesting and promising companies in a multi-stage selection process. In a first step, 85% of all financing requests are eliminated because they do not meet our basic criteria. We invite the remaining 15% to a non-public presentation to meet the founding teams and get to know their plans and to answer questions from our team. After this presentation, we only enter into negotiations with a few on minimum or maximum investment, company valuation, extensive investor rights, etc. in order to obtain the best conditions for our investor network.
As a rule, we do not present more than one percent of the applied companies to our Danube Angels network for investment.
How can you invest?
Select an investment opportunity
Discover our actual investment opportunities on our community platformand select a growth company in which you would like to invest.
Sign the investment documents
Sign the investment documents electronically, which will be sent to you by e-mail.
Transfer the investment amount
Transfer your investment amount.
Closing of the transaction
We complete the rest of the investment process and you benefit in the future from profits and increases in value of the growth companies.
Profit chance through investments in companies
- Through shares in growth companies in Central Europe
- Participation in current profits and/or
- Profit share when the company is sold (exit)
- Build up exit opportunities in 5to 7 years and increase the value of the investment
- Promising but risky investment opportunities
- Lower minimum investment than usual in this asset class: EUR 1,000 minimum investment
The Danube Angels Participation Model
Once the negotiations with the founders have been concluded and all contracts have been drawn up, we present the investment opportunity to our investor network.
Subsequently, everyone has the opportunity to participate in the financing round from an minimum amount of € 1,000. Danube Angels’ 100% subsidiary and trustee company “Danube Angels Treuhand GmbH” bundles all investments and invests the pooled funds in the target company, provided that the minimum investment amount has been reached by the end of the financing round. Over the duration of the investment, it is held by the trustee and managed together with the Danube Angels – you do not have to spend time on this.
As soon as the company distributes profits, these are transferred to you by the trustee. In the event of a sale of the investment (exit), the proceeds will also be paid out to you. Danube Angels provides you with information about the development of the investment as well as the course of business and the implementation of the growth strategy during the entire term of the investment.
The most important characteristics of the Danube Angels investment model summarized
- Danube Angels does not offer fund solutions. You decide whether you want to invest in a company and if so, what amount.
- The investments of all investors are pooled by the trustee, who invests this money in the company if the financing was successful. The trustee and Danube Angels take care of the investment for all investors, participate in general meetings of the company and exercise voting rights for all investors.
- Investors receive quarterly information on the company’s business performance and the implementation of the growth strategy. And if something in the company does not go according to plan, you will be informed immediately. Should it be necessary, the trustee will hold a vote among the investors on the exercise of certain investor rights, in which the majority of the votes cast will decide.
- If the company distributes profits or sells shares in the company, these will be transferred to you minus a service and success-related fee.
Pre-selected and interesting companies from Central Europe
Danube Angels receives continuously financing requests and checks them in advance for investors. Only around one percent of the companies meet our quality standards in terms of team, business model, scalability, market volume and USP and are introduced to our investor network.
Each investment contract with the companies is negotiated personally by Danube Angels for our investor network. Therefore, you will always find the most important investor protection rights in the agreements.
Participation by a trustee
The trustee “Danube Angels Treuhand GmbH”, a 100% subsidiary of Danube Angels GmbH, manages and takes care of the investment together with Danube Angels. The trustee becomes a direct shareholder in the target company and exercises the shareholder rights on your behalf and protects the interests of all investors.
You will not find a fixed interest rate with countless payout clauses in our contracts. If business is going well, you will receive a distribution. If the entire company is sold (exit), you receive your share of the sales proceeds
Transparency and reporting
For your investment decision, you will find all information and documents in the investment description. Through the support of the trustee or Danube Angels, you will receive quarterly reports on the company’s development and other important events.
Frequently asked questions
In 2017 Danube Angels GmbH was founded as a company with limited liability of three partners, who already own successful companies, to make use of the legal possibilities of crowd financing (“crowd-investing”) in Austria. The partners are Mag. Peter Helesic MBA (Helecom s.r.o.), Mag. Jakob Hütthaler-Brandauer (Rechtsanwaltskanzlei Hütthaler-Brandauer) and Paul G. Putz MBA (Paul Putz & Partner Management Consultants GmbH). Danube Angels selects and analyses participation possibilities in start-ups and growth companies in Austria, Germany, Switzerland and the CEE-region (“danube region”). After a positive outcome of the analysis, the investment project will be presented to the network investors of the Danube Angels, whereby the Danube Angels partner themselves always act as co-investors to express their commitment and belief in the target companies. Danube Angels has made it their goal to combine their partners’ expertise to increase the shareholder value for both investors as well as the target companies
In crowd-investing potential investors purchase shares of a company and provide capital to support it (typically in a new, young company with an innovative concept). This means that the investor – depending on the model of participation – is proportionally involved in profits and losses and in a possible future increase of the shareholder value. The individual investments are usually relatively small and allow the investor, to keep his risk per project in a financially manageable framework.
Best case scenario: The idea is accepted and converted into marketable products or marketable services. After reaching the break-even point and making up any start-up losses, the company achieves profits, in which the investor is involved. In the case of existing companies, this capital allows further growth. Dividends/interest payments are paid, the company grows, creates many jobs and flourishes. The value of the company increases and investors also profit from that effect. In case of an exit the investor receives a multiple of his initial investment, depending on the amount of participation of the company.
Worst case scenario: The idea fails to achieve the objective and is not accepted. The established or existing company becomes insolvent and the entire invested amount is lost. Margin obligation does not apply.
If crowd-investing is successful, attractive returns are possible. However, no reliable forecasts of future returns can be made. In particular income earned in the past are no indicator of future revenues. Each investment can lead to a total loss of the invested capital. So, notably the following risks become important:
- Insolvency risk: This means the risk of insolvency of the issuer and regularly leads to a total loss.
- Malversation risk: This means the risk of criminal offences by employees/organs in the company of the issuer. This can never be excluded entirely. Misconduct can directly or indirectly harm the issuer and lead to an insolvency.
- Risk concentration: This means the risk that arises if an investor makes no or only a small diversification of his portfolio. An investment in only a few companies is therefore strongly advised against.
- Difficult transferability of assets: This means that investments in accordance with § 1 (1) Z 3 KMG are only transferable under certain conditions and that there is generally no market value. Investment sums must be chosen so low that even a longer holding period will cause no liquidity problems.
General criteria for the choice and approval as issuer:
- The seat of the issuer is in Austria, Germany, Switzerland, Czech Republic, Slovakia or Hungary
- The legal form of the issuer is a corporation
- The corporation uses the capital of the investors for its operative business
- The company is profit- and growth-orientated
Because of the high complexity of companies and their projects no specific selection criteria can be developed. Therefore, Danube Angels is free to select or reject companies after their own judgement. Danube Angels receives up to eighty applications per month for crowd-investment from growth companies from the DACH region (Germany, Austria, Switzerland) and the CEE region (Czech Republic, Slovakia, Hungary). Danube Angels filters out the most interesting and promising companies from these applications. Nearly one percent of the applying companies are given the opportunity to present themselves on our platform.
Both natural persons and legal entities can invest in Danube Angels projects.
According to the Austrian Alternative Investments Act the investment sum per person and project may not be more than 5.000 Euros within 12 months. This limit can only be exceeded if the person or entity does not invest more than double of their average monthly income over 12 months or 10 percent of their financial fixed assets. This means, the investor must earn more than 2.500 Euros on a monthly average or have a financial fixed asset of at least 50.000 Euros to be allowed to invest more than 5.000 Euros per project and year. There is no maximum investment amount for legal entities.
The yields can be different depending on the project. However, no reliable forecasts of future returns can be made. In particular income earned in the past are no indicator of future revenues. Information to yield possibilities can be found in the investor-information sheets and the trust agreement of the projects.
Funding limit means the amount of money which will be maximally raised for a project. This amount can not be exceeded. The funding threshold lies under the funding limit and is the minimum amount that must be raised to realise the project. Only after reaching the funding threshold the trust agreement becomes valid.
If the funding threshold is not achieved during the allotted time, you receive your money (plus any interest which may have been accrued during this timeframe) back within 14 days.
The invested capital will be held in trust by Danube Angels Treuhand GmbH. If the funding threshold is not achieved during the allotted time, you receive your money back within 14 days. If the threshold is reached, Danube Angels Treuhand GmbH will transfer the collected capital to the target company and will hold the participation for all investors in trust.
- Discover our projects and select a growth company in which you would like to invest.
- Fill in our investment questionnaire.
- Transfer your investment amount.
- Benefit from the profits and increases in value of growth companies.
The investment duration can vary according to the project. Information to durations can be found in the investor-information sheets and the trust agreement of the projects.
- Pre-selected and interesting projects: Danube Angels receives continuously applications for crowd-investing projects and check them in advance for investors. Only around one percent of the applications meet our quality standards in terms of team, business model, scalability, market volume and USP and are approved for a campaign on our platform.
- Investor protection: Each investment contract with the companies is negotiated personally by Danube Angels for our investors. Therefore, you will always find the most important investor protection rights in these agreements.
- Participation by a trustee: You do not have to spend a lot of time looking after your investment. The trustee of your investment manages and takes care of your investment together with Danube Angels.
- Profit participation: You will not find a fixed interest rate with countless payout clauses in our contracts. If business is going well, you will receive a distribution. If the entire company is sold (exit), you receive your share of the sales proceeds.
- Transparency and reporting: You will find all information and documents for your investment decision on our project page. Through the support of the trustee or Danube Angels, you will receive half-yearly reports on the development of the company and other important events. And should you still have any questions, our team will be happy to assist you.
Commitment of Danube Angels: During the duration, the investor will be regularly informed about the development of his participation. This is done in three stages:
- Annual updates about the investment/investments
- Semi-annual updates about the investment/investments with information about the business development and the status of the implementation of the growth strategy
- Individual information about important (extraordinary) incidents (per email)
If specific questions arise, you also have the possibility to contact Danube Angels under email@example.com at any time.
The assignment of rights of the trust agreement by the trustor is permitted. However, a partial assignment of rights of the trust agreement by the trustor is not allowed. Further information to the assignments of rights of the trust agreement can be found in the investor-information sheets and the trust agreement of the projects.
Participation in a limited liability company
The limited liability company must deduct 27,5% capital gains tax (KESt) from dividends and pay them to the Austrian tax office. Austrian citizens must no longer pay tax on these profits (final taxation). If you have little income, a “standard taxation” can be requested and you will get back a part of the capital gains tax.
If the participation is sold with capital gain, you have to inform your tax office and pay 27,5% capital gains tax to it.
Foreign investors must indicate dividends and interest in their home country and will credit the Austrian capital gains tax. Capital gains are not subject to tax in some countries, therefore more favourable tax rates can arise for foreign investors.
If there is specific interest, we recommend to contact a tax advisor.
Please note: If the participation is held via a corporation, these regulations do not apply.
What our investors say
“The investment opportunities are clearly structured and contain all the documents for my investment decision.
This way investing is fun.”
„I appreciate the professional, regular and clear communication to the individual investments.”
Answers to frequently asked questions from our investors can be found here.
We will also be glad to answer your questions personally in a call or by e-mail.