The biggest angel investor group in Asia, India Angel Network, stated its apprehension over Sebi's proposal to do a lock in period for angel investors lasting three years. Sebi is a financial regulatory entity.

"This should remain flexible because the exit of an angel investor should depend on the requirement of the company concerned. There are instances where our investors have exited within 15 months," said Padmaja Ruparel, India Angel Network's president.

"Lock-in period is not what we are happy with," he summed in an interview with Business Standard.

The regulatory firm released its new guidelines stating that angel investors will experience a three-year lock in period when angels perform divestments. The IAN, through its president, expressed its dissatisfaction with the newly drafted rule.

As of current writing, other guidelines drawn by Sebi include allowing angel funds to invest only in companies which are unlisted, not more than three years old, and with a turnover report not above RUP25 crore. Furthermore, angels are forbidden to make investments in ventures endorsed by family and friends of fund promoters. Also, angel investors are only given a minimum investment value of RUP50 lakh.