Startups Can Now Raise Funds Without Founders Losing Control! 

Startups Can Now Raise Funds Without Founders Losing Control! 

SUMMARY

MCA has raised the existing cap on Differential Voting Rights (DVR) shares from 26% to 74%

The ruling also relaxed the requirement of companies being profitable to issue shares with DVRs 

Earlier this week, the finance ministry had issues circular to simplify angel tax assessment

Indian startups have long had to keep giving away control of their companies and ideas to foreign investors in return for capital to continue scaling up. This however may change soon due to the Indian government’s latest regulatory amendment with respect to differential voting rights.

The Ministry of Corporate Affairs (MCA) has amended rules to now allow Indian companies to raise more share capital without diluting the voting rights of all existing shareholders.

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