Venture Capital Fund Registration

According to the Companies Act 2013, Venture Capital Fund Registration is mandatory. The registered entity is not allowed to invite the public to subscribe to its securities. The director of the registered entity should be a sound and proper person and should not be involved in litigations connected to the securities market.

What is a Venture Capital Company?

Venture Capital firm is a company that helps small enterprises, startups, emerging, early-stage ventures through financial support. They not only provide financial support but also technical and managerial expertise to these startups. Venture Capital firms usually invest in companies where there is a high potential of earning huge profits. At the same time, even the risk of investing in these companies is really high. Venture Capital firms invest in these high-growth startups in exchange for equity which allows them to have an ownership stake.

Venture Capital Fund Services in India

Venture Capital funds are a major part of the startup ecosystem in India. Many financial institutions have started their own venture capital subsidiaries. Apart from Indian companies, many international companies have also started their funds in India providing support to businesses. Some of the famous venture capital firms in India are Helion Venture Partners, Accel Partners, Sequoia Capital India, and Nexus Venture Partners.

Services provided by Venture Capital Funds in India:

  • Development of a business plan for startups and also providing them the resources for the same.
  • Providing financial aid to high growth potential startups.
  • Apart from financial support, they also provide technical, managerial, and entrepreneurial support.
  • Venture Capital firms have a huge network which can be useful for startups to increase and grow their network.

The process to register as a Venture Capital Fund:

  • The applicant will submit an application to SEBI in Form A along with Rs. 1,00,000 of application fees and the necessary documents. The applicant needs to comply with all the requirements.
  • After receipt of the application, the applicant will get a reply from SEBI in 21 working days.
  • Details of the investment manager/ investment advisor/ Asset Management company.
  • Disclosing the investment strategy of the fund in detail. It should disclose the investment style, preferred sectors, proposed corpus, the class of investors, the life cycle of funds, and so on.
  • The applicant also needs to submit the following declarations: An undertaking under Regulation 11(3) of SEBI (Venture Capital Funds) Regulations, 1996; Undertaking under Third Schedule to SEBI (Venture Capital Funds) Regulations, 1996; Declaration in respect of “Fit and Proper Person” criteria as per regulation 4 A of the SEBI (Venture Capital Funds) Regulation 1996 and as specified under Schedule II of SEBI regulation 2008.
  • The application and the documents are then evaluated by the board.
  • The applicant pays the mentioned fees after receiving an intimation from the board.
  • Grant of certificate is received in Form B.

Services of Venture Capital Fund Registration Consultant:

  • Preparation and submission of application and the necessary documents to SEBI for grant of registration as a Venture Capital Fund under SEBI.
  • Follow up with SEBI to ensure that all the requirements are complied with.
  • As A Venture Capital Fund Registration Consultant already is well versed with the whole process, he/she can help in checking the eligibility criteria and other details and can also speed up the entire process.

HBF Direct Ltd. is a renowned consultancy firm and can help you with the venture capital fund registration process. Contact us for a seamless and quick registration of your fund.

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December 10, 2020

This was an excellent blog post. I’ll be back to view more.

December 10, 2020

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December 12, 2020

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January 8, 2021

What is the cost for setting up a venture capital fund?

January 12, 2021

Thanks for comment
Normally – 20cr but you can start with 5cr Angel fund
for more query please connect on 9971337447

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