i2i is releasing a toolkit for investors that they can use a guide to decide whether they should invest in a company or not. Starting today, it is available for free downloading.
It’s a very unique information product created as part of its Insights Lab. It is basically meant for the investors but can also help entrepreneurs and startup ecosystem builders. They are the first to build this product in partnership with Zahid Jamil (Barrister-at-law, Partner – Jamil & Jamil), with contribution from Mubariz Siddiqui.
i2i has been working with young entrepreneurs in Pakistan for the past four years, and it has seen a huge gap of information in the startup scene, particularly when it comes to investment and funding. It understands the fact that Pakistan is a very tricky environment to navigate and understand, and so it is crucial to equip investors with the right tools to make informed investment decisions, and know how to mobilize the capital, thus reducing investor risk.
The i2i Investor Toolkit essentially aims to be a 101 course for investors to know all the rules and regulations in Pakistan, so that they can make better investment decisions and are less hesistant to do so.
i2i’s CEO, Kalsoom Lakhani, shares her thoughts on launch of this toolkit:
We’re committed to seeing success stories come out of Pakistan. This is i2i’s step as part of a larger strategy to mitigate risk for investors so we can facilitate more capital in the country and hopefully see more success stories emerge.”
Many people don’t know that before 2013, there were minimum requirements for foreign investment in Pakistan. But now the Pakistan’s Board of Investment (BOI) has released a new Investment Policy which has eradicated the minimum requirements for a foreign equity investment amount in any sector.
Startup owners should know that there are four levels of shareholder ownership, as given in the i2i investor toolkit:
1. < 20% shares give you no special rights in a company.
2. A minimum of 20% gives you special minority shareholder rights in a company, i.e., the right to be able to petition company courts, etc.
3. Between 26% and 50% sharesgives you the right to block special resolutions within the company, (since someone would need at least 75% shares/ownership in order to pass a special resolution).
4. > 51% shares give you the majority of shares in a company
So entrepreneurs, beware. Never give investors more than 25% of your company, unless it’s really necessary. This i2i document also tells how the investors can protect themselves through SECP regulations. All in all, it is a great step taken by i2i to make the investors more comfortable with investing in Pakistan, thus inviting more foreign investment in the country.