How to Build a Venture Capital in India

• Ensure the eligibility benchmarks:

The initial step is to apply for the venture capital fund.The SEBI board checks all the norms and ensures whether the eligibility benchmarks are achieved t0 permit the “Venture Capital Fund”.The considering eligibility benchmarks are:

• For TRUST: should be registered properly under the registration Act provisions.

• For LLP:should be registered properly under the Limited Liability Partnership Act 2008.

• For BODY CORPORATE: The VCF activities are handled by the Memorandum of company.

1. Apply to SEBI 

Submit your application to SEBI through appropriately filled, numbered, duly signed and stamped  Form A, along with the required documents.An application fees of Rs.1 lakh should be submitted through bank draft.Online application are also acceptable under the specified rules.

• Application status Review

If the board approves the application,then the approval will be informed to the applicant.

Compliance for applicant/sponsor/manager

• There should not be any offence charged against the Director or any prime individual for moral turpitude or they must not be part of any lawsuit connected with the share bazaar which will affect the business.
• VFC should be efficient and effective to handle the operations.
• A clear report of the investing purpose,aimed investors,proposed body,investment structure,and details of fund return should be submitted at the registration time.
• The individuals under the Schedule II of SEBI Regulations are only acceptable.

1. Registration fee payment:

After the SEBI approval,an amount of Rs 10 lakh must be released as mentioned in Part A of the Second Schedule as per mentioned in the Part B in considering the Securities and Exchange Board of India.

• Issuing Registration Certificate:

After the payment the SEBI will issue the certificate as ‘Venture Capital Fund’ in Form B.

• Compliance filing:

After registration, monitor the SEBI website regularly,to know the instant VCF updates.If any material change occurs,inform the SEBI instantly.

VENTURE SCHEME for FARMERS

Venture Scheme for farmers is an interest free loan from SFAC (Small Farmers’ Agri-Business Consortium - society for farming, collaboration and farmers welfare, ministry of farming ).Government of India are already  facing many financial shortages so venture scheme will be a relaxation.The need for Venture Scheme  in Agriculture is that:

• To financially support agripreneurs to make reserves in setting  agroindustry ideas.
• Set up interest free credit to the start-up.

Eligible Applicants for Venture Capital

• Company/ Agripreneurs
• Partnership or proprietary firms
• Farmers
• Units in agri-export regions
• Self-help groups
• Producer assemblies

Required Documents:

• Request a letter to the Chief management of SFAC(Small Farmer’s Agri-Business Consortium )by the promoter.

• Authority approved sanction note,addressed to specific departments.

• An agreement supporting farmer’s list/backward linkage.

• A bank's permission note signed by the authorised authority mentioning the terms of sanction of term loan.

1. A Bank’s acknowledgement assuring, they will not absolve any primary or collateral security without the venture capitalist acknowledgement.

• Prior Bank’s Inspection Report.

1. Updated Term Loan account statements &  Cash Credit account statements.
2. If approved submit the  Equity certificate;
1. For Partnership or Proprietorship firms:CA certificate having UDIN 
2. For Companies:PAS-3 having allotment of equity details
3. For Company: SH-7 and other documents pertaining to roc/ annual filing filed with roc
3. Letter assuring no past Venture Capitals have been accessed.
4. Unsecured loan details if the company raised any,the detailed description should be enclosed in the ca certificate.
5. Justification, if there is a margin in the working capital of a project.

Registration Process:

Registration processes are online procedures,made through start up websites via link.Offline applications are not acceptable.

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