Document background
The Startup Investment Agreement is a crucial legal document used in Pakistan when investors seek to provide funding to startup companies in exchange for equity ownership. This agreement is essential for protecting both investors' and founders' interests while ensuring compliance with Pakistani legislation, including the Companies Act 2017 and Securities Act 2015. The document becomes necessary when a startup has progressed beyond initial formation and requires external investment for growth. It encompasses critical elements such as investment terms, shareholding structure, investor rights, governance mechanisms, and exit provisions. The agreement must be carefully structured to comply with local corporate laws while also accommodating international investment standards when foreign investors are involved. Special consideration is given to Pakistani foreign exchange regulations and investment protection laws when structuring cross-border investments.
