New Delhi: The government notified Startup India FoF 2.0 with a ₹10,000 crore corpus to mobilise capital for startups, the Ministry of Commerce and Industry said on April 13.
The scheme aims to boost venture and growth funding across the startup ecosystem. It will support deep tech, manufacturing and early growth-stage firms. Moreover, the Department for Promotion of Industry and Internal Trade (DPIIT) will soon issue operational guidelines.
Startup India FoF 2.0 builds on the earlier Fund of Funds for Startups (FFS 1.0), launched in 2016. That fund addressed funding gaps and encouraged domestic capital flows. Now, the new version expands this approach with a larger and structured framework.
The government will deploy the ₹10,000 crore corpus through eligible Alternative Investment Funds (AIFs). These commitments will span the 16th and 17th Finance Commission cycles. In addition, the fund will prioritise technology-driven and globally competitive startups.
The scheme uses a structured selection process for AIFs. A Venture Capital Investment Committee (VCIC), comprising industry experts, will screen proposals. Further, an Empowered Committee will monitor implementation and performance.
Startup India FoF 2.0 targets deep tech and manufacturing
Startup India FoF 2.0 focuses on deep tech startups and early-stage firms backed by smaller AIFs. It also supports innovative manufacturing and sector-agnostic ventures. Therefore, the scheme aims to widen access to risk capital.
The framework allows co-investment by government and institutional investors. It also includes governance safeguards and monitoring systems. As a result, the scheme seeks to ensure transparency and efficiency.
The government appointed the Small Industries Development Bank of India (SIDBI) as the implementation agency. It will operationalise the scheme from the date of notification. Meanwhile, the government will select another domestic agency to support execution.
The fund will contribute to SEBI-registered AIFs. These funds will invest in startups recognised by the central government. Thus, the structure will strengthen the funding pipeline for emerging enterprises.
Officials said Startup India FoF 2.0 will drive innovation-led growth. It will help build globally competitive technologies and products. Additionally, the scheme will generate jobs and boost manufacturing capacity.
The government added that the initiative aligns with the vision of Viksit Bharat 2047. Hence, it aims to strengthen India’s position as a global innovation hub through sustained support for entrepreneurs.
