Exit strategy refers to the method using which a venture capitalist can exit/get out of the investment it made in the past. It is also known as a “liquidity event’ or a ‘harvest strategy” since it is a calculated decision to harvest maximum profits while cutting back on expenditure. A special exemption has been made for FVCIs which provides that they can sell or acquire their Indian shares / convertible preference shares / convertible debt / any other unit invested at a rate that is mutually acceptable to both parties. Thus, there are no entry or exit restrictions imposed on an FVCI which makes the investment arrangement more advantageous for them.