For startups, it is necessary to know there are 3 types of investment, divided as follows:

1. Stock Investments (Equity)
   This means that money goes directly to the company and there is no obligation to return it. Investments in shares can only enter into companies in the form of PT, because only PT has a share structure. Stock investment means selling or transferring shares to obtain a number of funds from investors, and in return the investors will own shares in the company. As shareholders, investors are considered as owners of the company and are entitled to benefit in the form of dividends, as well as voting rights that can determine the company’s future policies. Funding through shares can only be made in companies in the form of PT. Because the concept of shares only exists in the structure of PT. Which then the capital will be divided into shares so that investors who provide capital will automatically be considered as shareholders. And there is no obligation to return. When choosing to acquire capital by investing in shares, it must be accompanied by an agreement between the shareholders or a Shareholders Agreement. In which, this agreement regulates among others the rights and obligations of shareholders, distribution of dividends, voting rights, transfer of shares, and other matters that govern the relationship of shareholders.
2. Shareholder Loan
   Investments with shareholder loans are the provision of loans from company shareholders, with an obligation to return them to investors with a certain interest and time. Usually this type of loan bears low interest, even at all, because this loan is given by a party very close to the company, so usually this loan can be given without the need to provide guarantees for shareholders as creditors. In accordance with Article 12 of Government Regulation No.97 of 2010. This investment needs to be accompanied by a shareholder loan agreement or a credit agreement between the shareholders and the company. [Addition: whereas if the shareholders intend to increase the amount of capital put into the company or if the business is seeking funding through equity participation, a longer process is required because there is a need for changes to the company’s deeds].
3. Loan with a share pledge. (Convertible Note)
   This method is generally applied to startup funding where investors will lend a certain amount of funds to startups, which can later be withdrawn. If the startup fails to pay the amount of debt and interest beyond the predetermined time period, the debt will be converted into shares in the startup. In other words, investors here have the option of converting their receivables into shares. This form of investment is usually carried out by foreign investors. This type of investment is accompanied by a Convertible Note agreement).