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Can Anyone Start Investing in Retail Angel Platforms with Just $50,000?
Harsh Bharwani |67 Answers |Ask -Follow
Entrepreneurship Expert - Answered on Oct 05, 2024
Harsh Bharwani is a fourth generation entrepreneur.
As CEO and managing director, he leads the international business and employability initiatives at the computer networking institute, Jetking Infotrain Limited.
After graduating from Delhi University, Bharwani joined the family business in 2010 and set up operations in the US and Vietnam.
He has trained over three lakh students in employability, confidence and key life skills.... more
As CEO and managing director, he leads the international business and employability initiatives at the computer networking institute, Jetking Infotrain Limited.
After graduating from Delhi University, Bharwani joined the family business in 2010 and set up operations in the US and Vietnam.
He has trained over three lakh students in employability, confidence and key life skills.... more
Asked by Anonymous - Aug 26, 2024Hindi
Hi, I am interested in retail angel investing for startups. I have heard that there are platforms where retail investors can start investment with as less as 50K or 1 lakh. Is it true? And is it legal? If it is, can you kindly inform me of a few platforms where I can join and invest. Thank you.
Ans: Yes, retail angel investing for the startup is definitely possible; however, it is perfectly legal in India if it happens according to the rules and regulations provided by SEBI- The Securities and Exchange Board of India. One would say that angel investing is all about being a rich person. Well, not anymore. Today, with some of the online portals, you can even invest in starting up with as little as ?50,000 or ?1 lakh. That is a huge plus for retail investors like you who would like to support early-stage ventures but do not have big amounts of capital.
You must be wondering if really small amounts of investment are legal. The good news is that, yes, they are, but they have to happen through regulated channels. SEBI has put forth guidelines under the Alternative Investment Fund (AIF) category so that the process is above board. These platforms connect investors to startups in a structured way and offer transparency with legal safety. Therefore, it is a very risky proposition- the very nature of angel investing means you're essentially betting on new startups. Most of the time, companies either hit huge or hit nothing. Therefore, as mentioned before, legal and accessible always consider the risks and make the right decision.
About the platforms, in India, few are especially for retail investors looking for angel investing. A few of the popular ones are AngelList, LetsVenture, and Tyke. Here you have all these startups at different levels looking to raise funds. It enables you to go through the startups, see what their business models are, and pick the ones you find believable to have some potential. What's so fascinating about these platforms is the way they help to amalgamate smaller investments coming in from many individuals to cater to the needs of the startup. So, even if you are just putting in ?1 lakh, you become a part of a much larger group of investors, making it relatively easy for the startup to raise funds as required.
Now, although your investment sum is smaller, this also has to be approached with caution. You will have to research the backgrounds of these startups, their business plans, and the sectors they focus on. Given that this is a game of high risks, you also want to invest in a few different kinds of startups to differentiate your risk a bit. Furthermore, the other thing that might build up from these platforms would be the provision of access to due diligence reports and investor meetups, which would make you even more confident in making decisions regarding your investments.
In short, Yes, you can begin angel investing with relatively small amounts and some platforms help retail investors like you to get legally involved and safely. Just do your homework right, do some more research, talk to people who have been in the same situation, take some risks, and be patient- it's all part of the exciting journey of startup investing.
You must be wondering if really small amounts of investment are legal. The good news is that, yes, they are, but they have to happen through regulated channels. SEBI has put forth guidelines under the Alternative Investment Fund (AIF) category so that the process is above board. These platforms connect investors to startups in a structured way and offer transparency with legal safety. Therefore, it is a very risky proposition- the very nature of angel investing means you're essentially betting on new startups. Most of the time, companies either hit huge or hit nothing. Therefore, as mentioned before, legal and accessible always consider the risks and make the right decision.
About the platforms, in India, few are especially for retail investors looking for angel investing. A few of the popular ones are AngelList, LetsVenture, and Tyke. Here you have all these startups at different levels looking to raise funds. It enables you to go through the startups, see what their business models are, and pick the ones you find believable to have some potential. What's so fascinating about these platforms is the way they help to amalgamate smaller investments coming in from many individuals to cater to the needs of the startup. So, even if you are just putting in ?1 lakh, you become a part of a much larger group of investors, making it relatively easy for the startup to raise funds as required.
Now, although your investment sum is smaller, this also has to be approached with caution. You will have to research the backgrounds of these startups, their business plans, and the sectors they focus on. Given that this is a game of high risks, you also want to invest in a few different kinds of startups to differentiate your risk a bit. Furthermore, the other thing that might build up from these platforms would be the provision of access to due diligence reports and investor meetups, which would make you even more confident in making decisions regarding your investments.
In short, Yes, you can begin angel investing with relatively small amounts and some platforms help retail investors like you to get legally involved and safely. Just do your homework right, do some more research, talk to people who have been in the same situation, take some risks, and be patient- it's all part of the exciting journey of startup investing.
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