There was a recent thread on Twitter about how even in 2020 angels and VCs in India continue to put ridiculously onerous terms into early-stage deals.
I am tired of devils masquerading as angels & angel networks in the Indian startup ecosystem.
— Prasanna K (@prasanna_says) September 30, 2020
These assholes have screwed many founders by normalizing abusive terms. Holding founders hostage in their own viable businesses.
There will be a reckoning
It won’t be pretty
I recently invested in an Indian startup that closed a pre-series A round and the documents were more than 100 pages. When I was at 500 Startups, with the help of BMR Legal, we modified the 500 Startups KISS Agreement for India and open sourced the documents in the hopes that it would simplify early-stage documentation and reduce the amount of time to close a deal and the cost of doing early-stage deals in India, much like Series Seed docs and the SAFE have done in the US.
Here’s a presentation I gave in January 2020 at CIE-IIIT Hyderabad on some of the deal terms in India to watch out for. Unfortunately, there’s no video of the actual presentation I gave so I recorded a voice over for you.
If there are additional terms you have questions about or terms you’ve come across that are onerous, please leave a comment on the YouTube video and I will respond. Hopefully, other founders will benefit from it as well.
