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ARTICLE · 31 JULY 2025

How MoA Language Affects Investor Due Diligence

Agama Law Associates
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A mid-growth SaaS company, fresh off their first term sheet for a ₹40 crore infusion, found themselves in a surprising delay. Everything was aligned: due diligence done, traction numbers strong, founder chemistry perfect.

IndiaCorporate/Commercial Law
Archana Balasubramanian
Archana Balasubramanian
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A mid-growth SaaS company, fresh off their first term sheet for a ₹40 crore infusion, found themselves in a surprising delay. Everything was aligned: due diligence done, traction numbers strong, founder chemistry perfect. Then the investor's compliance team flagged one line in the Memorandum of Association (MOA).

The company, focused on AI-led financial products, had a stray object clause that permitted "real estate development." It had been drafted years ago, copied from a template during incorporation. Nobody had looked at it since. But for the investor's compliance officer, it raised a red flag: was the company planning a pivot? Were there sectoral compliance risks?

The cheque was withheld. The clause had to be edited. Filings redone. Precious weeks lost. Trust, just slightly, eroded.

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