India: Venture Capital

India’s startup definition has long been tied to two basic limits: the age of the business and its annual turnover. The test was easy to apply, but it did not always reflect the reality of ventures whose growth does not follow a conventional timeline. Deep tech businesses may spend years on scientific research, product testing and technology development before earning meaningful revenue. Cooperative enterprises may also build innovative and scalable solutions, even though their ownership structure differs from that of a company or an LLP. As India’s startup ecosystem became more diverse, the earlier framework began to leave some genuine innovators outside its scope.

Compulsorily Convertible Preference Shares (CCPS) remain one of the most widely used instruments for venture capital and private equity investments in Indian companies. Their appeal lies in the ability to combine equity classification with negotiated economic and governance protections. But CCPS are not governed by a single, standalone statutory framework. Their legal treatment is instead shaped by the Companies Act, FEMA and foreign investment rules, tax law, and, where applicable, SEBI regulations.

Over the years, Securities and Exchange Board of India (“SEBI”) has introduced a series of reforms to refine the winding-up framework governing Alternative Investment Funds (“AIFs”). Through these changes, SEBI has sought to make the winding-up process more practical and comprehensive, addressing the various issues that arise at the end of a fund’s tenure and improving the overall framework for closure of AIFs.

Key Amendments to the FDI Framework for Investments from Land-Bordering Countries

The problem surfaces during legal due diligence for a follow-on transaction. A new lead investor issues a term sheet with conditions. The conditions require simplifying the cap table first.

Every aspiring entrepreneur begins with an idea. It may feel innovative, profitable, or even disruptive. However, the reality of entrepreneurship quickly reveals one important truth.

On October 3, 2025, a circular was issued by the International Financial Services Centres Authority (IFSCA) to all financial institutions in GIFT IFSC...

In a strategic move set to transform the real estate and infrastructure investment landscape in India, the Securities and Exchange Board of India (SEBI) released a consultation paper on August 1, 2025 , suggesting major amendments to the definition of "strategic investor" within the REIT and InvIT regulations.

During AY 2021-22, the Assessee1 purchased 5.92 Cr. shares of IG3 Infra Limited(‘IG3') at INR 12.43 per share and 18.43 Cr. shares of ETL Power Services Limited (‘ETL') at the price of INR 14.30 per share on 08.08.2020.