Sebi Relaxes Rules For Angel Funds to Boost Startup Funding

In an effort to boost startup funding, Sebi has amended some of its rules for investment by angel funds, including allowing them to invest in up to five-year-old entities. The board has also relaxed the lock-in requirement from the current three years to one year for angel funds and their minimum investment threshold has been slashed from Rs 50 lakh to Rs 25 lakh.

Accordingly, angel funds can invest in startups incorporated within five years, which was earlier three years. To diversify risks, Sebi has also allowed angel funds to make overseas investments, up to 25% of their investible corpus, in line with other AIFs.

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