CORPORATE
Govt unveils rules to activate second tranche of Rs 10,000-cr fund for start-ups
- IBJ Bureau
- Apr 26, 2026
The government has issued detailed guidelines for operationalisation of the second tranche of Rs 10,000-crore fund of funds (FoF) scheme for start-ups.
The guidelines include mechanisms for deployment of the fund, its governance and monitoring, with the objective of improving efficiency of capital flows into India’s start-up ecosystem, the Commerce and Industry Ministry said.
The scheme will be implemented through commitments to SEBI-registered Category-I and -II Alternative Investment Funds (AIFs), which will invest in the start-ups recognised by the Department for Promotion of Industry and Internal Trade (DPIIT).
“This approach is expected to ensure disciplined capital allocation, crowding in of private investments and wider access to funding across sectors, stages and geographies,” the ministry adds.
Small Industries Development Bank of India (SIDBI) will act as the initial implementation agency and will undertake execution through a structured process of selection and monitoring of AIFs.
The DPIIT will also on-board an additional implementation agency to expand reach, enhance sectoral expertise and build institutional capacities for managing such schemes.
“To address specific gaps in the ecosystem, the operational guidelines introduce a structured segmentation of AIFs into deep tech-focused funds, micro-venture capital funds supporting early-growth startups, funds focused on innovative and technology-led manufacturing sectors and sector- and stage-agnostic funds,” it has said.
The implementation agency will undertake initial screening and due diligence, followed by evaluation by a Venture Capital Investment Committee, which will assess proposals based on the track record of the team, fund management capability and investment strategy.
Report By
View Reporter News