FAQs
A startup is traditionally defined as a newly established private company designed to scale quickly. Most startups start as small operations while they develop their initial idea, and then seek additional funding from venture capitalists and angel investors as they build their businesses.
Agility Ventures Partners offer investors to invest with a minimum amount of ₹2,00,000.
- Selling of shares to a new investor in the company.
- Mergers & Amalgamation of the company.
- A takeover of the company by big corporates.
No, a start-up does not offer any kind of dividend or share in profits to the investors. It is considered that startup investing is for net worth building not for monetary returns.
- Small investment amount
- High returns
- Diversification of portfolio
- Networking
- High risk
- Delay in returns
- Less liquidity
- Access to a periodical or annual financials of the company.
- Prerogative in every big decision making of the company.
- Legal remedies for any breach.
- All the rights of a shareholder.
- Understanding the terms and conditions before investing.
- Understanding the product and operational framework.
- Transfer funds to the startup’s bank account on time.
- Inform and educate yourself.
In case of any breach, investors have the legal right to sue a company in a competent court of law. The agreements being entered by a startup and the investors are admissible in the court.
Yes, It is risky to invest in startups. However, it can be mitigated.
The risk can be mitigated by diversifying the investment in more startups.
- Edutech
- Fintech
- Agritech
- Healthcare
- Automobile
- Technology
- Consumer Goods
- E-commerce
- Background of founders
- The idea of the business
- Level of innovation
- Team strength
- Future prospects
- Technical aspect
- Lead investor
- Mentors or advisors associated
- Idea Stage: Where there is just an idea and the execution hasn’t started for the same.
- Seed Stage: Where the idea is to be executed but with a small round of funding up to ₹50,00,000.
- Angel Round: Where there is a small background of the startup but it is withheld in growth due to lack of funds. Angel investors come and invest somewhere between ₹1 crore to ₹5 crores.
- Pre-Series A: Where investment round falls between ₹3 crores to ₹12 crores.
- Series A: Where investment round falls between ₹15 crores to ₹100 crores.
- Future rounds: Startups may also go for Series B, C and D.
Anyone can invest in an Indian startup through the usual banking channel using their bank account. In the case of an NRI, the person can also use their NRE/ FCNR (B) account maintained with an AD Category I bank.
The following instruments can be issued by an Indian Company for receiving the investment:
- Equity Shares
- Compulsory Convertible Preference Shares
- Optionally/ Partially Convertible Preference Shares
- Optionally/ Partially Convertible Debentures
- Lottery Business includes government or private lotteries, and online lotteries.
- Gambling and betting including casinos.
- Chit funds.
- Nidhi company.
- Manufacturing of cigars, cheroots, cigarillos and cigarettes, of tobacco or tobacco substitutes.
- Trading in Transferable Development Rights (TDRs).
- Real estate business or construction of farmhouses.
- Activities or sectors not open to private sector investment e.g. (I) Atomic energy and (II) Railway operations (other than permitted activities mentioned in entry 18 of Annex B).
Yes, the amount invested in Indian startups is repatriable, subject to applicable taxes, except in cases where the investment is made on a non-repatriation basis.
The Capital Gains Tax as per the Income Tax Act is applicable on the exit to the investors.
The company has to comply with the FDI regulations and make all the necessary filings with the Reserve Bank of India through its Authorised Dealer Bank. The type of filing depends upon the type of instrument issued by the company.
No, the investor is not required to make any compliance before investing in India, subject to the investment limits under FDI.