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AngelList, the Silicon Valley angel investment firm has launched its Syndicates for India, offering high net-worth investors (HNIs) to pool in with like-minded individuals and fund entrepreneurs with seed funding for their startups. It has Utsav Somani leading the India initiative. AngelList has helped over 1,800 startups, which include online ride-hailing app Uber, raise more than $700 million through the Syndicates on the platform. These firms have raised over $6 billion in follow-on funding. The Silicon Valley platform comes to India at a time when Angel funding in the country has seen a three-year low in 2017 as investors shied away in an environment where exits have been low and regulatory policies around taxation linger.
Investors have sought from the government to scrap the so-called Angel Tax, a clause in the Income-Tax Act in the 2012 budget, which mandates startups to classify any consideration above the fair value of shares to be income from other sources.AngelList will also see angel funding as an established practice among Indian startups, with entrenched local player Indian Angel Network, having built a strong portfolio of members who have funded startups as a syndicate and mentored them over a period of time. As part of this launch, we’ve gathered the support of experienced entrepreneurs and investors in India like (FreeCharge founder) Kunal Shah, (Saama Capital co-founder) Ash Lilani and others. Approved backers will get access to syndicates from great investors like (FreeCharge co-founder) Sandeep Tandon, ( Venture Partner at 500 startups) Shalini Prakash, K-Start and others, "AngelList said in a blog post. In the past, AngelList has supported investments into Indian startups like ClearTax, DocTal, and Squad. Syndicates are private single-deal investment vehicles that let you invest in startup allocations shared by syndicate leads, enabling more angels to participate by getting access to top deals. Similar to a VC fund, syndicates provide experienced investors the opportunity to earn carried interest on their allocation, and the ability to write bigger checks by pooling capital from dozens of backers in the ecosystem, it said.