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A Seed investment agreement lays out the terms when early-stage investors put money into Indonesian startups in exchange for equity. It covers crucial details like company valuation, investment amount, and the rights each party gets - following rules set by Indonesia's Financial Services Authority (OJK) and Investment Coordinating Board (BKPM).

This agreement protects both founders and investors by spelling out key protections, voting rights, and exit options. It typically includes anti-dilution provisions, board representation terms, and information rights that give investors visibility into the company's progress, while ensuring compliance with Indonesian corporate law and capital market regulations.

Use a Seed investment agreement when your Indonesian startup is ready to accept its first external funding from angel investors or early-stage venture capital firms. This agreement becomes essential once you've found investors willing to provide capital, typically between IDR 500 million to IDR 5 billion, in exchange for equity in your company.

The timing is critical: implement this agreement before any money changes hands, and definitely before issuing new shares. Indonesian law requires proper documentation of all investment transactions, and having this agreement in place helps avoid future disputes about ownership, voting rights, and exit terms while ensuring compliance with OJK regulations.

• Basic equity-only agreements: Simplest form of Seed investment agreements where investors receive standard shares with typical voting rights, used mainly by early-stage Indonesian startups
• Convertible note variations: Popular among tech startups, allowing investment to convert to equity at a later date with pre-agreed terms and OJK-compliant interest rates
• SAFE agreements: Increasingly common in Indonesia's startup ecosystem, offering a simpler alternative without maturity dates or interest rates
• Staged investment structures: Agreements that release funding in phases based on reaching specific business milestones

• Startup Founders: Lead negotiations and must understand key terms as they'll be bound by investment restrictions and reporting obligations
• Angel Investors: High-net-worth individuals who provide early funding and require protection of their investment rights
• Venture Capital Firms: Professional investors who draft detailed terms to safeguard their interests while complying with OJK regulations
• Corporate Lawyers: Draft and review agreements to ensure compliance with Indonesian investment laws and protect both parties
• Company Directors: Must approve and implement the agreement's terms, including share issuance and governance changes

• Company Details: Gather current capitalization table, latest financial statements, and corporate registration documents
• Investment Terms: Define investment amount, valuation, share price, and any conversion mechanisms
• Due Diligence: Prepare business plan, financial projections, and key contracts for investor review
• Governance Rights: Specify board seats, voting rights, and information access privileges
• Exit Provisions: Detail tag-along rights, drag-along rights, and anti-dilution protections
• Regulatory Compliance: Ensure alignment with OJK regulations and BKPM investment requirements

• Party Identification: Full legal names, addresses, and registration numbers of startup and investors
• Investment Terms: Precise investment amount, share price, and equity percentage calculations
• Rights and Obligations: Clear outline of investor rights, reporting requirements, and founder commitments
• Share Details: Class of shares, voting rights, and dividend entitlements
• Protection Clauses: Anti-dilution provisions, pre-emptive rights, and transfer restrictions
• Governing Law: Explicit reference to Indonesian law and OJK regulations
• Dispute Resolution: Agreed mechanism for resolving conflicts under Indonesian jurisdiction

A Seed investment agreement differs significantly from a Pre-seed Angel investment agreement in several key aspects, though both are crucial for Indonesian startups seeking early-stage funding.

• Investment Size: Seed rounds typically involve larger amounts (IDR 500 million to IDR 5 billion) compared to pre-seed deals (usually under IDR 500 million)
• Investor Profile: Seed agreements often involve institutional investors or VC firms, while pre-seed deals are mainly with individual angel investors
• Legal Complexity: Seed agreements include more sophisticated terms like anti-dilution rights and board seats, whereas pre-seed agreements are usually simpler
• Company Stage: Seed funding typically requires more established metrics and market validation, while pre-seed focuses on early concept and team potential
• Regulatory Requirements: Seed agreements face stricter OJK oversight and documentation requirements due to larger investment amounts