Startups

Tamil Nadu Govt unveils equity model in TANSEED 5.0 to foster startup growth

• ByStartupStory     |    February 27, 2023

The Tamil Nadu government has announced the inclusion of an equity model for startups in the upcoming fifth edition of Tamil Nadu Startup Seed Fund (TANSEED 5.0). This move is intended to incentivize enterprises to expand their operations and is a first for the state.

Since its inception in 2021, TANSEED has provided support to 84 startups in Tamil Nadu. The upcoming fifth edition of TANSEED will introduce an equity model, where startups will receive funding in exchange for a 3% stake. This is a first for the state and aims to encourage startups to expand their operations.

According to an official statement, the government aims to assist startups in reaching their milestones and achieving greater heights through proper guidance by providing investment in the form of equity.

The upcoming fifth edition of TANSEED aims to provide equity investments to 50 startups, helping bridge the gap in their fund requirements during the early stages of development. TANSEED focuses on supporting green technology, rural impact, and women-led ventures by offering seed funding of up to Rs. 15 lakhs.

T M Anbarasan, the Minister for Micro, Small and Medium Enterprises, had previously declared in the assembly that 100 startups would receive Rs. 10 crore through TANSEED. Startups that wish to avail themselves of TANSEED’s benefits must focus on product innovation, development, or improvement with the potential to generate employment opportunities, as per the official release. Additionally, the startup should be headquartered in Tamil Nadu and registered with the Department of Promotion of Industry and Internal Trade.

Many beneficiaries of TANSEED in its previous editions have recorded growth and raised venture capital funds from prominent investors, the government said.

 

 

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