US-based investment crowdfunding platform AngelList has launched its syndicate programme in India.
The syndicates allow experienced technology investors to create a single VC fund that raises money from institutions and leading angel investors.
The company has already roped in a number of syndicate leads including Freecharge founders Kunal Shah and Sandeep Tandon; Ash Lilani, co-founder and managing partner of Saama Capital; KStart Capital, the seed investment platform of venture capital firm Kalaari Capital; and Shalini Prakash, venture partner at 500 Startups.
“The launch of syndicates for India broadens the range of investors startups can raise funds from in the ecosystem. Traditionally, an angel investor with conviction may write a single ₹10 lakh cheque to a startup. With syndicates, that same investor can lead a syndicate and pool more capital from dozens of backers who can help the company,” AngelList said on its blog post.
In August 2016, the group had appointed Utsav Somani, former Delhi chapter lead of LetsVenture and a member of the Indian Angel Network, to lead its operations in India.
AngelList has supported investments into Indian startups like ClearTax, DocTalk and Squad in the past.
San Francisco-based AngelList was founded in 2010 by India-origin serial entrepreneur Naval Ravikant along with Babak Nivi, and the syndicate programme was launched in 2013. The network claims to have facilitated $700 million in investments through syndicates for over 1800 startups since then.
Any Indian resident meeting certain eligibility requirements—including having net tangible assets of at least Rs 2 crore, prior experience as an early stage investor or serial entrepreneur, or an AIF (Alternative Investment Fund) registered under SEBI AIF Regulations—can become an investor through the syndicate programme.
Any angel investor with considerable experience in matters related to startup investing (such as negotiating term sheets, closing investment rounds) and who have made at least a few notable startup investments can lead a syndicate on AngelList.
A syndicate pools capital from a variety of investors into a limited liability company that invests in the startup alongside the syndicate lead. AngelList handles the whole process of a syndicate including taxes, documents, accounting, legal and liquidity events. It charges 5% carry on deals done through the platform.