15 Critical Questions: Your Portugal Golden Visa Fund Due Diligence Checklist (2026)

Look for established managers with years (ideally 10+) of experience specifically in Portugal and in the fund's asset class (e.g., Private Equity, Venture Capital). Ask for audited track records of previous funds, including successful exits (IRR, CoC). Explorer Investments, for instance, has over 20 years in the Portuguese PE market.

This is MANDATORY for Golden Visa eligibility. Ask for the CMVM registration number and verify it directly on the CMVM website . Lack of regulation is an immediate disqualifier.

Understand their backgrounds, specific expertise in the target sectors, and how long they've worked together. Stability and relevant, hands-on experience in the team are crucial for executing the strategy.

A significant 'General Partner' (GP) commitment (typically 1-5% of fund size) demonstrates alignment of interest ('skin in the game') and the manager's own confidence in the strategy. Ask for the percentage and confirmation it's cash, not deferred fees.

Verify the fund's official documents (Regulation/PPM/Prospectus) explicitly state its eligibility and compliance mechanisms. Key points: minimum 60% investment in Portuguese-domiciled commercial entities, appropriate fund maturity (e.g., 8-10 years), and confirmed CMVM regulation.

[Learn more about CMVM funds]

Most qualifying funds are Portuguese FCRs (Fundos de Capital de Risco) or sometimes SCRs (Sociedades de Capital de Risco), ensuring they meet local investment and regulatory requirements.

This is CRITICAL for US tax compliance. Failure to get these detailed statements annually can lead to punitive US tax rates under PFIC rules. Confirm the manager's experience with US investors and their commitment to providing timely, accurate PFIC statements allowing a QEF election. Explorer Investments provides this standardly.

[Learn about PFIC/FATCA]

Assets MUST be held by a reputable, independent custodian bank (confirm identity). The fund MUST be audited annually by a recognized, independent auditing firm (e.g., Big Four). This ensures segregation of assets and external verification of financials.

Understand precisely where and how your money will be invested (e.g., buyouts of mature SMEs via PE, seed funding for tech startups via VC, specific sectors like renewable energy, hospitality). How does the manager find investment opportunities? Assess if the strategy aligns with your risk tolerance. PE generally targets established businesses with cash flows, offering potentially more stability than early-stage VC.

[Explorer's PE Approach]

All investments carry risk. Ask for a clear explanation beyond the boilerplate text in the PPM. Key risks include: market downturns affecting exits, execution risk (manager's ability to improve companies), illiquidity risk (inability to sell your units easily), and potential regulatory changes. The manager should articulate how they mitigate these risks.

Understand the valuation methodology (e.g., IPEV guidelines are standard for PE/VC) and reporting frequency (e.g., quarterly). How are valuations audited? Consistent, conservative valuation is key for accurate performance tracking.

Demand a complete, transparent breakdown. Common fees: annual management fee (e.g., 1.5-2.5% on committed or invested capital), performance fee/carried interest (e.g., 20% of profits above a hurdle rate, typically 6-8%), potential one-off subscription fees, and ongoing fund administration costs. Understand the total expense ratio and how fees impact your net return.

Be highly skeptical of guaranteed or overly high projected returns, especially in PE/VC. Ask for the basis of the projection (comparable deals, past performance - audited). Understand the difference between Gross and Net IRR/CoC (Cash-on-Cash multiple). Focus on realistic, achievable net returns based on the strategy and manager's proven ability.

Ensure the fund's legal term (e.g., 8 years + potential extensions) provides ample buffer beyond your minimum 5-year Golden Visa holding period. Understand the manager's typical holding period for portfolio companies and their strategy for realizing value (e.g., trade sale, IPO, secondary buyout).

PE/VC funds are illiquid. Clarify the exact mechanisms: Are there specific redemption windows defined in the regulation? Is there an established secondary market for fund units (often difficult)? What are the manager's obligations regarding returning capital upon fund termination? Understand potential delays and costs associated with exit.