This article explores the general features of sociedades anónimas promotoras de inversión (SAPIs) and their relevance to entrepreneurs and startups seeking to raise investment in Mexico.
We’ll also look at the differences between SAPIs and other types of companies, as well as the provisions you can include in their bylaws to keep in mind when setting up a company in Mexico.
An overview of SAPIs for startups in Mexico
Before getting into the details, it’s important to understand the context around Sociedades Anónimas Promotoras de Inversión, also known as SAPIs. Here are some key points:
- They are governed by the Securities Market Law and the General Law of Commercial Companies.
- They incorporate good corporate governance practices.
- Greater protections for minority shareholders.
- The company may buy back its shares.
- Shareholders’ agreements and bylaw provisions allow investors to join quickly, securely, and easily.
- A SAPI is a middle ground between a SAB and an SA
- An ideal vehicle for receiving private equity and venture capital investment.
Why choose a SAPI in Mexico?
The short answer is: If your goal is to raise investment in Mexico, a SAPI is the ideal option. If your goal is to operate a business, we recommend an S de RL. We recommend taking a look at this article, which explains in more detail, why an S de RL is the best option for operating in Mexico, when you already have an international legal structure.
Comparing a SAPI with an S de RL and an SA de CV
Here are the 3 most common types of legal entities in Mexico. Depending on your business objectives, one may suit you better than another.
Provisions in the bylaws
Once you’ve decided that a SAPI will be your company’s legal entity, here are some provisions you can include in the bylaws to improve the management of the company and its shareholders.
- Establish restrictions on the transfer of shares.
- Specify grounds for excluding shareholders or for allowing them to exercise withdrawal or separation rights.
- Capital structures that allow for different series of shares, each with different rights and obligations.
- Mechanisms for resolving disputes.
- Tag-along or drag-along sale rights (Drag along and tag along).
Conclusions
In conclusion, SAPIs are an ideal option for entrepreneurs and startups seeking private equity and venture capital investment in Mexico. They offer an advanced legal framework for corporate governance, minority rights protection, and flexibility in share structure.
If you’re considering setting up a company and need to receive investment, we recommend evaluating a SAPI and seeking specialized legal advice to ensure compliance with regulations and maximize the benefits for your company and investors.