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How Can Investor Have Redemption Rights Post Investing In Equity?

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roshan's picture
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How can investor have company buy back their shares if company is not doing well ? http://venturebeat.com/2011/07/04/demystifying-the-vc-term-sheet-redempt...

nishithmansata's picture
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Exit strategies

Roshan, the best possible route is to have a put option embedded in the equity instrument. However, given the complex nature of such securities, the Indian capital market, which is relatively immature, has never shown attention / interest in the matter.
If such a clause is not put in, then a good way is to hire an investment bank / consultant to see if there is any possibility of improving the company and / or discuss any possible exits (eg. sale to other private investors etc.)

Let me know your thoughts.

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