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INDEX

1 INTRO

2 HISTORY

3 CHARACTERISTICS

4 ADVANTAGES AND DISADVANTAGES

5 TYPES OF FUNDING

6 HOW DOES VC WORK?

7 DIFFERENCE BETWEEN VC,ANGEL INVESTOR & PRIVATE EQUITY FIRMS.

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Introduction to venture capital

Meaning of venture capital

Venture capital (VC) is money provided to seed, early-stage, emerging and emerging growth companies. The venture capital funds invest in companies in exchange for equity in the companies it invests in.

It is money provided by an outside investor to finance a new, growing, or troubled business.

Definition- Start up companies with a potential to grow need a certain amount of investment. Wealthy investors like to invest their capital in such businesses with a long-term growth perspective. This capital is known as venture capital and the investors are called venture capitalists.

According to bank of England quarterly bulletin of 1984,”venture capital investment is defined as an activity by which investors support entrepreneurial talent with finance and business skills to exploit market opportunities and thus obtain long-term capital gains.”

The venture capitalist provides the funding knowing that there’s a significant risk associated with the company’s future profits and cash flow. Capital is invested in exchange for an equity stake in the business rather than given as a loan, and the investor hopes the investment will yield a better-than-average return.

Venture capital is an important source of funding for start-up and other companies that have a limited operating history and don’t have access to capital markets. A venture capital firm (VC) typically looks for new and small businesses with a perceived long-term growth potential that will result in a large payout for investors. A venture capitalist is not necessarily just one wealthy financier. Most VCs are limited partnerships that have a fund of pooled investment capital with which to invest in a number of companies. They vary in size from firms that manage just a few million dollars worth of investments to much larger VCs that may have billions of dollars invested in companies all over the world. VCs may be a small group of investors or an affiliate or subsidiary of a large commercial bank, investment bank, or insurance company that makes investments on behalf clients

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of the parent company or outside investors. In any case, the VC aims to use its business knowledge, experience and expertise to fund and nurture companies that will yield a substantial return on the VC’s investment, generally within three to seven years.

FEATURES OF VENTURE CAPITAL.

New ventures: venture capital investment is generally made in new enterprises that use new technology to produce new products, in expectation of high gains or sometimes, spectacular returns.

Illiquidity: Easy liquidity by cashing out in the short-term is not an option for venture capital funding. An IPO or buyout of a venture is how venture capitalists disinvest. A premature IPO could undermine an otherwise successful company. Alternatively an IPO released in a poor IPO market could also stall possibilities of cash out.

Long-term commitment: Venture capital funds need to be latched in for a period of few years before disinvestment. Investors who do not prefer illiquidity will attach a premium to their funds, also known as liquidity risk premium. Therefore an investor who can wait out the time horizon will benefit from this premium. University endowments who seek VC funds to invest in are an example of such investors.

Difficulty in determining current market values: It is difficult to evaluate the current market value of the portfolio of a VC.

Limited historical risk and return data and limited information: Venture capital funds more often than not invest in new and cutting edge industries of a sector, where there is little historical data or continuous trading data. It is also difficult to estimate cash flows or the probability of success.

Entrepreneurial/management mismatches: Entrepreneurs may face difficulties when there is dilution of ownership and control. Bad

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management choices may scuttle a good venture. Entrepreneurs sometimes find it difficult to step up as the venture gains size.

Fund manager incentive mismatches: Investors interested in well performing rather than large sized funds need to find managers who match their investment objectives.

Knowledge of competition: As we discussed earlier since most business’ that are funded are from nascent industries it is difficult to assess the competition, than say in established industries. A complete competitive analysis is therefore difficult to undertake for a VC fund.

Vintage Cycles: Economic conditions vary from year to year. During some years venture capital funding is plenty and therefore returns for them low. In poor or stressed market condition, even good firms find it difficult to find VC funding.

Extensive Operation Analysis and Advice: Venture capital funds that plan to invest in technology companies may not have the required expertise to assess them. Financial investment knowledge alone is not sufficient. Good fund managers therefore require both operating and financial analysis and advising skills. A fund manager who does not understand the business will impede rather than improve it.

HISTORY

Background on the Venture Capital Industry

Venture capital is private money to fund early-stage, high-potential/high-risk, growth companies. The provider of the money

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generally wants an equity stake and a return of capital within five to ten years through:

i) An initial public offering (IPO) of the company, or

ii) A sale of the company to a strategic investor, usually a large and well-established technology company.

Long-term harvesting through dividends and share buybacks are generally not used by venture capital firms, for reasons discussed below.

Most venture capital is invested in high technology industries such as software, computer hardware, biotechnology, clean energy, and so forth. Yet some venture capital firms invest in scalable low-tech business ideas like consumer products and retail. Venture capital is directed toward new companies with a limited operating history, which are too small to raise capital in the public markets, secure a bank loan, or complete a debt offering. In exchange for the high risk that venture capital firms assume by investing in smaller and less mature companies, they get significant control over a company’s decisions (through board seats), plus a large portion of the company’s equity (so large that founders sometimes call them “vulture capitalists”).

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The startup game goes like this: An aspiring entrepreneur starts with a team, an idea, and some artificial currency (stock). Her goal is simple: to increase the value of the business and so the stock, so she and her team can cash out. The trick is to swap portions of the stock for resources that make the business more valuable: people, more and better ideas, and money. The initial people want stock and they bring their ideas, or intellectual property (designs, patents, contacts, trade secrets, etc.). The venture capital firms give cash in stages for the team to hit milestones to prove the business. Yet at any point, the team can pull the plug, or the business can die if the milestones aren’t met and the venture capitalists don’t give more capital. Game over. Alternatively, the company can make a promising product and so sell itself to a corporate acquirer or to the public markets in an IPO. The entrepreneur and her team can cash in and leave. Or they can double down and try to be corporate managers. Success.

Venture capital firms are typically comprised of small teams with technology backgrounds (scientists, researchers), with business training from investment banks or consulting firms, or with deep industry experience. Venture capitalists bring managerial, governance, and technical expertise, as well as capital, to their investments. [Note: Confusingly, both a venture capital firm and a partner/associate of a venture firm, a “venture capitalist,” are both referred to as a “VC”] Venture capitalists pool together funds for their investments from institutional investors (pension funds, foundations, endowments) and high net worth individuals, through creating a partnership (most commonly a limited partnership, where the venture firm is the general partner, or “GP,” and the outside investor is the limited partner, or “LP”).

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Venture capital and startup generation are often associated with job creation, the knowledge economy, and business or technological innovation. One stunning fact comes from Robert Litan, who directs research at the Kauffman Foundation, which specializes in promoting entrepreneurship and innovation in America: “Between 1980 and 2005, virtually all net new jobs created in the U.S. were created by firms that were 5 years old or less . . . That is about 40 million jobs. That means the established firms created no new net jobs during that period.”[12] The National Venture Capital Association estimates there were 12.1 million jobs at venture-backed companies in the US as of 2009, and those companies accounted for 21% of US GDP.

Some of the themes from the history of venture capital include:

Origins with family offices of very wealthy families such as the Phipps, Rockefellers, and Whitneys;

The influence of one man, George Doriot, in single-handedly creating much of the modern venture capital industry;

Early informal partnerships in Silicon Valley due to a confluence of factors, most importantly the high-tech semiconductor industry and offshoots of Fairchild Semiconductor;

Great venture firms like KPCB, Sequoia, and NEA refining the partnership-based model of investing with institutional capital;

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The loosening of ERISA rules and the boom and busts of the 1980s and 1990s, in which success mixed with excess;

An industry somewhat lost in the 2000s and searching for a viable model again.

One of the most insightful sayings about the Valley has been repeated by Don Valentine and John Doerr, two of the most successful venture capitalists: “Silicon Valley is a state of mind.”

ADVANTAGES OF VENTURE CAPITAL FUNDING

Business expertise. Aside from the financial backing, obtaining venture capital financing can provide a start-up or young business with a valuable source of guidance and consultation. This can help with a variety of business decisions, including financial management and human resource management. Making better decisions in these key areas can be vitally important as your business grows.

Additional resources. In a number of critical areas, including legal, tax and personnel matters, a VC firm can provide active support, all the more important at a key stage in the growth of a young company. Faster growth and greater success are two potential key benefits.

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Connections. Venture capitalists are typically well connected in the business community. Tapping into these connections could have tremendous benefits.

Because VC firms are under strict supervision by regulatory bodies, there are very few or no unscrupulous VCs.

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DISADVANTAGES OF VENTURE CAPITAL FUNDING

Loss of control. The drawbacks associated with equity financing in general can be compounded with venture capital financing. You could think of it as equity financing on steroids. With a large injection of cash and professional—and possibly aggressive—investors, it is likely that your VC partners will want to be involved. The size of their stake could determine how much say they have in shaping your company’s direction.

Minority ownership status. Depending on the size of the VC firm’s stake in your company, which could be more than 50%, you could lose management control. Essentially, you could be giving up ownership of your own business.

Bottom line: Would you rather own your own business or partner in a larger, potentially more successful one?

Most VC firms do not release all the needed funds up front. Rather, they usually release funds in stages with an eye on the expansion of the business. This approach may not be suitable for the business plan and might ruin the business.

Usually, VC firms want to close the deal and get their investment back within three to five years. If your business plan contemplates a longer timetable before providing liquidity, VC funding may not be suitable for you.

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TYPES OF FUNDING

The first professional investor to a deal at the start-up stage is referred to as the Series A investor. This investment is followed by middle and later stage funding – the Series B, C,and D rounds. The final rounds include mezzanine, late stage and pre-IPO funding. AVC may specialize in provide just one of these series of funding, or may offer funding for all stages of the business life cycle. It’s important to know the preferences of the VC you’re approaching, and to clearly articulate what type of funding you’re seeking:

1. Seed Capital. If you’re just starting out and have no product or organized company yet, you would be seeking seed capital. Few VCs fund at this stage and the amount invested would probably be small. Investment capital may be used to create a sample product, fund market research, or cover administrative set-up costs.

2. Startup Capital. At this stage, your company would have a sample product available with at least one principal working full-time. Funding at this stage is also rare. It tends to cover recruitment of other key management, additional market research, and finalizing of the product or service for introduction to the marketplace.

3. Early Stage Capital. Two to three years into your venture, you’ve gotten your company off the ground, a management team is in place, and sales are increasing. At this stage, VC funding could help you increase sales to the break-even point, improve your productivity, or increase your company’s efficiency.

4. Expansion Capital. Your company is well established, and now you are looking to a VC to help take your business to the next level of

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growth. Funding at this stage may help you enter new markets or increase your marketing efforts. You should seek out VCs that specialize in later stage investing.

5. Late Stage Capital. At this stage, your company has achieved impressive sales and revenue and you have a second level of management in place. You may be looking for funds to increase capacity, ramp up marketing, or increase working capital.

You may also be looking for a partner to help you find a merger or acquisition opportunity, or attract public financing through a stock offering. There are VCs that focus on this end of the business spectrum, specializing in initial public offerings (IPOs), buyouts, or recapitalizations. If you are planning an IPO, a VC may also assist with mezzanine or bridge financing – short-term financing that allows you to pay for the costs associated with going public.

A key factor for the VC will be risk versus return. The earlier a VC invests, the greater are the inherent risks and the longer is the time period until the VC’s exit. It follows that the VC will expect a higher return for investing at this early stage, typically a 10 times multiple return in four to seven years. A later stage VC may be seeking a two to four times multiple return within two years.

VCs would be more interested in listening to entrepreneurs who have a perfect exit strategy planned for investors. There are various exit option for VC to cash out their investment:

1) Initial Public Offering (IPO) : IPO is about offering company shares in the market for public to buy or sell. IPO constitutes the most preferred route for VC exit as it offers flexibility to investors in

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terms of time, price and quantity. Through this route, investors can decide when to sell, at what price to sell and in what quantity to sell depending upon the market scenario. IPO gives a perfect opportunity to reap benefits for their investment.

2) Mergers & Acquisition: M&A offers an opportunity to investors to sell company shares (partially /fully) to another company. In this case, investors doesn’t have enough flexibility since pricing,timing and quantity are decided simultaneously during the process and thereby investors don’t have control over the exit.

Entrepreneurs and investors can sale the business to either strategic partner for a stake or allow bigger players in the same industry to acquire.

3) Shares buyback: Company promoters or entrepreneur can buy back the company’s shares from Investors on a fixed price after negotiation. For investors, this is the least preferred route since ROI in this case is capped. However, investors would like to go for this VC exit option only when IPO & M&A route is not available to them and company is not doing well in terms of meeting expectations of investors.

4) Sale to Other Strategic Investor/Venture Capital Fund: It is quite possible that VC prefer to offload their shares to other strategic investors which could be either bigger angel investors or venture capital funds who are ready to put more money into the business.

Venture Capital partners always prefer exit option which not only gives them their investment back but also offer minimum protected return which they could have earned easily by putting money into the open market investment opportunities.

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HOW DOES VC WORK?

From a company's standpoint, here is how the whole transaction looks. The company starts up and needs money to grow. The company seeks venture capital firms to invest in the company. The founders of the company create a business plan that shows what they plan to do and what they think will happen to the company over time (how fast it will grow, how much money it will make, etc.). The VCs look at the plan, and if they like what they see they invest money in the company. The first round of money is called a seed round. Over time a company will typically receive 3 or 4 rounds of funding before going public or getting acquired.

In return for the money it receives, the company gives the VCs stock in the company as well as some control over the decisions the company makes. The company, for example, might give the VC firm a seat on its board of directors. The company might agree not to spend more than $X without the VC's approval. The VCs might also need to approve certain people who are hired, loans, etc.

In many cases, a VC firm offers more than just money. For example, it might have good contacts in the industry or it might have a lot of experience it can provide to the company.

One big negotiating point that is discussed when a VC invests money in a company is, "How much stock should the VC firm get in return for the money it invests?" This question is answered by choosing a valuation for the company. The VC firm and the people in the company have to agree how much the company is worth. This is the pre-money valuation of the company. Then the VC firm invests the

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money and this creates a post-money valuation. The percentage increase in the value determines how much stock the VC firm receives. A VC firm might typically receive anywhere from 10% to 50% of the company in return for its investment. More or less is possible, but that's a typical range. The original shareholders are diluted in the process. The shareholders own 100% of the company prior to the VC's investment. If the VC firm gets 50% of the company, then the original shareholders own the remaining 50%.

Dot Coms typically use Venture Capital to start up because they need lots of cash for advertising, equipment, and employees. They need to advertise in order to attract visitors, and they need equipment and employees to create the site. The amount of advertising money needed and the speed of change in the Internet can make bootstrapping impossible. For example, many of the eCommerce Dot Coms typically consume $50 million to $100 million to get to the point where they can go public. Up to half of that money can be spent on advertising!

DIFFERENCE BETWEEN VC,ANGEL INVESTORS,PRIVATE EQUITY

FUNDS.

ANGEL INVESTORS

Angels are often retired entrepreneurs or executives who want to optimize their experiences and networks and who like to keep abreast of business developments. But they are motivated beyond the pure money return – they desire to serve as mentors for the next generation of entrepreneurs.

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An increasing number of angels are forming angel groups or networks so they can pool their resources of wisdom and capital and make bigger and better investments. Top business sectors favored by angel investors in 2013 included software, media, healthcare services, biotech, retail, and financial services.

Angel investors usually provide funding at the seed stage, but they don’t like to invest until the business owner has shown initiative by placing his or her own capital at risk. According to Jeffrey Sohl of the UNH Center for Venture Research, angel investments totaled $24.8 billion in 2013. That money benefited 70,730 entrepreneurial enterprises and reflected an 8.3% increase from 2012.

VENTURE CAPITALISTS

Like angels, venture capitalists (VCs) invest in people, products, and ideas. While the media is full of stories about venture capitalists investing in startups, the truth is that VCs seldom actually do. Typically, their role comes at a later stage after seed-funding has been satisfied.

VCs often invest as a group and are typically willing to invest in higher risk ventures than either angels or private equity firms. This makes them very attractive to a diverse mix of enterprises and to businesses that are too small to raise capital in the public markets. According to Geri Stengel’s Forbes article, “Want Venture Capital? Here are 10 Must-Haves,” VCs like innovative market disruptors that

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are capable of catapulting a venture into a $100 million company, one that will capture an impressive slice of markets worth $1 billion or more.

Brian DeChesare’s article, “Private Equity vs. Venture Capital,” explains that VCs are willing to take high risks because they generate huge returns. They often stake less than $10 million for early stage companies, but they invest in dozens of them. Peter Cohan’s January, 2014 Forbes article explains the math. Only one out of ten of VC portfolio companies become big winners. Of the rest, three will succeed enough to recoup investments, and the rest go out of business.

The National Venture Capital Association reports that their investors have a history of interest in high technology companies, but if a product is disruptive and promising, they will also invest in more traditional industries like consumer and business products, manufacturing, and healthcare services.

PRIVATE EQUITY FIRMS

Private equity (PE) firms raise funds sourced from high net-worth individuals and institutional investors such as pension funds, insurance companies, and endowments. They invest these funds in a large cross-section of industries. Their investments are fewer in number than those made by angels and VCs but much larger in value. If one investment fails, the whole PE fund could fail. Marv

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Dumon in “What is Private Equity,” reports that most PE firms deal with middle market transactions ($50 million to $500 million) and lower market transactions ($10 million to $50 million). They seek out existing companies that are ripe for expansion or are under-optimized. They purport to help a healthy enterprise fulfill their business vision or expand their products and services by providing the needed funds.

Big PE firms like The Carlyle Group, Kohlberg Kravis Roberts, and The Blackstone Group are known for investing in leveraged buyout (LBO) transactions in mature companies. In an LBO the PE firm uses its own equity plus a large amount of debt (leverage) that they raise at the time of the deal to acquire a company or a business unit. The target company is supposed to have stable cash flows. The PE firms claim they make the companies more efficient. Through higher efficiencies and the power of leverage they hope to earn a high return on their equity investment.

If your business is in the position to seek funding from a private equity firm, quantify the PE firm’s capabilities, confirm their connections, and be sure their expertise is compatible with your business sector. This due diligence can help lead to a very positive experience.

Sebi and venture capital funding

Regulations of Venture Capital:

VCF are regulated by the SEBI (Venture Capital Fund) Regulations, 1996. The regulation clearly states that any company or trust proposing to carry on activity of a VCF shall get a grant of certificate from SEBI. Section 12 (1B) of the SEBI Act also makes it mandatory

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for every domestic VCF to obtain certificate of registration from SEBI in accordance with the regulations. Hence there is no way that an Indian Venture Capital Fund can exist outside SEBI Regulations. However registration of Foreign Venture Capital Investors (FVCI) is not mandatory under the FVCI regulations.

A VCF and registered FVCI enjoy several benefits:

• No prior approval required from the Foreign Investment Promotion Board (FIPB)

for making investments into Indian Venture Capital Undertakings (VCUs).

• As per the Reserve Bank of India Notification No. FEMA 32 /2000-RB dated

December 26, 2000, an FVCI can purchase/ sell securities/ investments at a price

that is mutually acceptable to the parties and there is no ceiling or floor restriction

applicable to them.

• A registered FVCI has been granted the status of Qualified Institutional Buyer

(QIB), so they can subscribe to the share capital of a VCU at the time of intial

public offer. A lock-in of one year is applicable to the shares subscribed in an IPO.

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• The lock-in period applicable for the pre-issue share capital from the date of

allotment, under the SEBI (Disclosure and Investor Protection) Guidelines, 2000

is not applicable in case of a registered FVCI and VCF.

• Under the SEBI (Substantial Acquisition of Shares and Takeover) Regulations,

1997 if the promoters want to buy back the shares from FVCIs, it would not come

under the public offer requirements.

SEBI regulations

Main requirements under SEBI (Venture Capital Funds) Regulations, 1996:

The following are the eligibility criteria for grant of a certificate of registration as per regulation 4 of SEBI (Venture Capital Funds) Regulations 1996.

For the purpose of grant of a certificate of registration, the applicant has to fulfil the following, namely:-

(a) if the application is made by a company, -

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(i) memorandum of association has as its main objective, the carrying on of the activity of a venture capital fund;

(ii) it is prohibited by its memorandum and articles of association from making an invitation to the public to subscribe to its securities;

(iii) its director or principal officer or employee is not involved in any litigation connected with the securities market which may have an adverse bearing on the business of the applicant;

(iv) its director, principal officer or employee has not at any time been convicted of any offence involving moral turpitude or any economic offence.

(v) it is a fit and proper person.

(b) if the application is made by a trust, -

(i) the instrument of trust is in the form of a deed and has been duly registered under the provisions of the Indian Registration Act, 1908 (16 of 1908);

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(ii) the main object of the trust is to carry on the activity of a venture capital fund;

(iii) the directors of its trustee company, if any, or any trustee is not involved in any litigation connected with the securities market which may have an adverse bearing on the business of the applicant;

(iv) the directors of its trustee company, if any, or a trustee has not at any time, been convicted of any offence involving moral turpitude or of any economic offence;

(v) the applicant is a fit and proper person.

(c) if the application is made by a body corporate

(i ) it is set up or established under the laws of the Central or State Legislature.

(ii) the applicant is permitted to carry on the activities of a venture capital fund.

(iii) the applicant is a fit and proper person.

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(iv) the directors or the trustees, as the case may be, of such body corporate have not been convicted of any offence involving moral turpitude or of any economic offence.

(v) the directors or the trustees, as the case may be, of such body corporate, if any, is not involved in any litigation connected with the securities market which may have an adverse bearing on the business of the applicant.

(d) the applicant has not been refused a certificate by the Board or its certificate has not been suspended under regulation 30 or cancelled under regulation 31.

Application for Registration:

An applicant should apply for registration in form A prescribed under First Schedule of SEBI (Venture Capital Funds) Regulations 1996 along with requisite fees. All documents should be enclosed as specified in the form.

While applying, please ensure that the main object clause of the memorandum of the applicant company/ trust deed, etc., as the case may be, permits you to carry on venture capital fund activities. While applying, please also submit the following additional information:

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A complete list of your associate companies registered with SEBI , and also indicate the capacity in which they are registered along with the SEBI Registration number

2.      State whether the applicant is registered with SEBI in any capacity.

 

3.      A complete list of your group companies registered with SEBI, and also indicate the capacity in which they are registered with SEBI along with their SEBI Registration number.

 

4.      Whether    the applicant or the intermediary, as the case may be or its whole

      time director or managing partner has been convicted by a Court for any   offence involving moral turpitude, economic offence, securities laws or fraud

 

5.   Whether any winding up orders have been passed against the applicant or the intermediary

 

6.      Whether any orders under the Insolvency Act have been passed against the applicant or any of its directors, or person in management and has not been discharged.

 

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7.      Whether any order restraining prohibiting or debarring the applicant or its whole time director from dealing in securities in the capital market has been

passed by SEBI or any other regulatory authority and a period of three years from the date of the expiry of the period specified in the order has not elapsed;

 

8.    Whether any order canceling the certificate of registration of the applicant on the ground of its indulging in insider trading, fraudulent and unfair trade practices or market manipulation has been passed by SEBI and a period of three years from the date of the order has not elapsed ;

 

9.    Whether any order, withdrawing or refusing to grant any license/ approval to the applicant or its whole time director which has a bearing on the capital market, has been passed by SEBI or any other regulatory authority and a period of three years from the date of the order has not elapsed.

 

9.     Whether the applicant or its group/associate companies are listed on any of the recognised stock exchange(s) in India. If so, please furnish the details.

10.     (a) Details of registration of your company/associate/group companies (to be given separately), which are registered/ required to be registered with Reserve Bank of India (RBI) as a Banking company or Non Banking Finance Company or in any other capacity andaddress(es) of concerned branch office(s) of RBI.

(b) Details of disciplinary action taken by RBI against you or any of your group/associate companies.  Please also inform us in case there is any default in repayment of deposits by you or any of your group / associate companies. 

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Applicant can submit ‘no objection certificate’ from RBI for getting registered with SEBI, to expedite the registration process.  

Other Documents to be submitted to SEBI 

1)     Memorandum and Articles of Association of applicant company, executed copy of trust deed if the fund is being set up as a trust and main objective of constitution in case of body corporate.   

2)     Executed copy of Investment Management Agreement, if applicable.

3)     Disclose in detail the investment strategy as required under regulation 12(a) of the SEBI (Venture Capital Funds) Regulations, 1996. Also state the target size of the fund along with the profile of the investors of the fund.

4)     An undertaking to the effect that the fund will not enter into any venture capital activity if it fails to raise a commitment of at least Rs. five crore as required under Regulation 11(3) of SEBI (Venture Capital Funds) Regulations, 1996.

5)     Copies of letters of commitment from investors in support of the target amount proposed to be raised by the fund.

6)     Undertaking that the venture capital fund will not make investment in any area listed under Third Schedule to SEBI (Venture Capital Funds) Regulations, 1996.

7)    Venture Capital Fund shall disclose the duration/  life cycle of the fund.

      

Grant of Certificate of Registration

Once all above requirements have been complied with and requisite fees as per Second Schedule to Regulations has been paid, SEBI will grant certification of registration as a venture capital fund.

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