You need to meet one of the following requirements:
At the time of making an investment, the Angel Investor becomes part of an Angel Fund, which is registered with SEBI under the AIF Regulations. Under the (Indian) Income-tax Act, 1961. Angel Funds have been accorded pass through status in respect of all incomes (except business income), i.e. investors are subject to tax as if they had directly invested in the portfolio companies. There is a 10% withholding at the time of making payments to investors, which the investors can claim credit for, while filing their returns.
AngelList India is not qualified to provide tax advice and the above should not read as tax advice. There are many exceptions to the generalisation stated above, so please be sure to consult with your tax advisor and accountant before making an investment.
Yes, but the bar for accreditation for US syndicates is slightly higher. Individuals are required to have a net worth of at least $1,000,000, excluding the value of one’s primary residence, or have an income of at least $200,000 each year for the last two years.
Leads get carry for their syndicated investments. This allows them to leverage their deal flow by earning upto 15% carry on the allocation being shared with backing investors. Learn more about the economics of syndicates.
Investors can participate in syndicates with lower minimums. They get access to lead’s deals and benefit from their experience in picking and managing investments. These deals will be typically hard to access for someone who hasn’t spent considerable time in building deal flow.
Startups get more capital with a single cap-table entry.
Leads and Investors will be required to meet the minimum threshold of investing INR 25 Lakhs over a period of 5 years from the time of making their first investment with AngelList India. This can be in a single investment or over multiple investments.
Generally, it is recommended to make multiple investments to have a portfolio of startups that will help in diversifying risk associated with startup investing.
Companies and leads may or may not choose to provide any information about performance. Investors will be getting a statement of report on their unit holdings annually. This will be provided by a third party.
Startups don’t pay for syndicate investments. Investors usually pay 0-15% deal carry to the syndicate lead, and 5% deal carry to AngelList India.
Investors also pay the out-of-pocket costs for each deal—currently 2% of the deal size, up to a maximum of ₹5L. These costs are paid to third parties such as fund administrator, payment processors and accountants.
The Eligible Angel Investor should have considerable experience in matters related to startup investing (e.g. negotiating term sheets, closing investment rounds) and should have made at least a few notable startup investments. Contact firstname.lastname@example.org with specific details.
Generally, the opportunity should meet most, if not all, of these conditions:
In case of any doubts, contact email@example.com.
No syndicate will have more than 199 Eligible Angel Investors from India.
AngelList values privacy and by design, everything is private. Backers have to apply to back syndicates and see any deal that the lead wishes to share with them. This is the only way for top deals to attract value-add backers in a syndicate
The return from the carry will be realised only upon a successful liquidation event (e.g. secondary, sale, public offering) and will be shared as per the distribution guidelines mentioned in the investment documents.
Typically, 15% carry will be paid out to the Lead Investor and 5% carry will be paid out to AngelList India.
Raising through AngelList India's Angel Fund benefits the company since the company is exempt from the Indian "Angel Tax" which could otherwise apply in certain situations if the Angel Investor had invested directly into the company. The Indian "Angel Tax" is levied on the portfolio company on the capital invested, if it receives funding at a valuation, which is more than the fair market valuation derived as per the Indian Income tax rules and will be forcefully treated as income.
Unless otherwise permitted by SEBI under the AIF regulations, AngelList India syndicates can only invest in companies which:
Yes, select opportunities would be made available to foreign investors that will be structured as a US based special-purpose vehicle similar to other AngelList syndicates.
Non-Indian investors will be investing into a US based special-purpose vehicle. At the time of exit, the purchaser may withhold taxes on the amount of gains and the SPV will file taxes on its returns of income in India.
AngelList India is not qualified to provide tax advice and the above should not be read as tax advice. There are many important exceptions to the generalisation stated above, so please be sure to consult your tax advisor and relevant international tax treaties before making an investment.