Startup FoF commits ₹7,980 cr to 99 AIFs as of December: Govt
- ByStartupStory | February 3, 2023
The Fund of Funds for Startups (FFS), established in 2016 as part of the Startup India initiative, has committed $7,980 crore to 99 Alternative Investment Funds (AIFs) as of December 31, 2022, said Minister of State for Commerce and Industry Som Parkash on Friday.
In a written reply to a question in Rajya Sabha, the minister said, “As on 31st December 2022, under the Fund of Funds Scheme (FFS) for startups, Rs. 7,980 crore has been committed to 99 Alternative Investment Funds (AIFs) and Rs. 3,400 crore has been disbursed to 72 AIFs which have in turn made investments of Rs. 14,077 crore in 791 startups…As reported by SIDBI, FFS has played an important role in wealth creation, employment generation, inclusive growth and recognition for startups.”
FFS was declared with a corpus of ten thousand crores. The corpus will be built up over the 14th and 15th Finance Commission Cycles (FY 2016-2020 and FY 2021-2025) with budgetary support from the Ministry of Commerce and Industry’s Department for Promotion of Industry and Internal Trade (DPIIT).
“Under FFS, the scheme does not directly invest in startups, instead provides capital to SEBI-registered AIFs, known as daughter funds, who in turn invest money in growing Indian startups through equity and equity-linked instruments,” the commerce and industry ministry said in a statement.
The Small Industries Development Bank of India (SIDBI) has been tasked with running the fund by selecting eligible daughter funds and managing the disbursement of pledged resources. AIFs financed by FFS are obligated to invest in startups at least twice the amount committed under FFS.
“The flagship schemes namely, Fund of Funds for Startups (FFS), Startup India Seed Fund Scheme (SISFS) and Credit Guarantee Scheme for Startups (CGSS) are supporting startups at various stages of their business cycle to enable startups to graduate to a level where they will be able to raise investments from angel investors or venture capitalists or seek loans from commercial banks or financial institutions,” the ministry said.
The government also holds annual exercises and programmes such as state Startup Ranking, National Startup Awards, and Innovation Week, all of which contribute to the overall development of the startup ecosystem.
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