Indian Startup Surge: Rs 14,077 crore have been made in 791 startups through the Fund of Funds for Startups (FFS) Scheme and Alternative Investment Funds (AIFs) as of December 31, 2022. This was revealed by The Minister of State for Commerce and Industry, Som Parkash in parliament.
According to the Minister, the FFS for startups has committed Rs 7,980 crore to 99 AIFs, with Rs 3,400 crore disbursed to 72 AIFs for investment in startups. The top ten states and Union Territories with the highest number of startups include Karnataka, Maharashtra, Delhi, Haryana, Tamil Nadu, Uttar Pradesh, Telangana, Madhya Pradesh, Gujarat, and Assam.
The FFS Scheme was established in 2016 with a corpus of Rs 10,000 crore to boost the Indian startup ecosystem and provide access to domestic capital. It does not directly invest in startups, but instead provides capital to SEBI-registered AIFs, also known as daughter funds, who invest in Indian startups through equity and equity-linked instruments. The Small Industries Development Bank of India (SIDBI) has been tasked with operating the Fund and overseeing the disbursal of capital through suitable daughter funds.
Under the FFS Scheme, AIFs are required to invest at least two times the amount committed through the FFS in startups. The government is supporting the startup ecosystem through various efforts, including FFS, the Startup India Seed Fund Scheme (SISFS), and the Credit Guarantee Scheme for Startups.
“The Indian startup ecosystem has been growing at a rapid pace, and the government is committed to supporting this growth through various initiatives,” said Som Parkash, Minister of State for Commerce and Industry. “The Fund of Funds for Startups Scheme has been instrumental in providing capital to young businesses, enabling them to reach their full potential.”
The Startup India Initiative by the government aims to support the development and growth of the startup ecosystem in the country. The SISFS was approved with a corpus of Rs 945 crore for a four-year period starting from 2021-22. As of December 31, 2022, Rs 477.25 crore has been approved to 133 incubators, with Rs 211.63 crore disbursed.
Startup Surge: Highlights of Fund of Funds and Alternative Fund Scheme
- Investments worth Rs 14,077 crore were made in 791 startups through FFS Scheme and AIFs as of December 31, 2022.
- The top ten states with the highest number of startups are Karnataka, Maharashtra, Delhi, Haryana, Tamil Nadu, Uttar Pradesh, Telangana, Madhya Pradesh, Gujarat, and Assam.
- The FFS Scheme was established in 2016 with a corpus of Rs 10,000 crore to provide a boost to the Indian startup ecosystem.
- The SIDBI is tasked with operating the Fund and overseeing the disbursal of capital through daughter funds.
- The government is supporting the startup ecosystem through various efforts, including FFS, SISFS, and the Credit Guarantee Scheme for Startups.
In conclusion, the Indian startup ecosystem has been receiving ample support from the government through various initiatives, with the Fund of Funds for Startups Scheme playing a major role in providing capital to young businesses.
