startup investment: How some platforms that facilitate small-ticket funding for startups operate in a regulatory grey area
iStock
Given the regulatory grey area platforms like Tyke and their clients operate in, it may well be a matter of time before regulators turn their beady eyes on them again.
Synopsis
Platforms like Tyke work in a regulatory grey area with almost no guidelines or rules defining their financial instruments and arrangements. Their transactions resemble public offers of shares but they are not. The platforms behave like a quasi-exchange but they are not licensed to be one.
15 mins read,
Animesh Maity (name changed) was one of the 876 people who invested in a fintech startup called Vanghee in February 2022. Vanghee counts ICICI Bank as its primary investor. Delhi-based Maity invested Rs 20,000 in the startup through a platform, Tyke. Like many others, he didn’t go through the terms of agreement or the risk acknowledgement document that he signed. He was just excited at the prospect of investing in a startup with a few thousand
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