Cabinet approves Startup India Fund of Funds 2.0 with ₹10,000 crore corpus

The Cabinet has approved the second tranche of the Startup India Fund of Funds Scheme with a corpus of Rs 10,000 crore, Union Minister Ashwini Vaishnaw said on Saturday.

The key focus would be on deep tech startups, early growth stage startups through smaller funds, tech-driven innovative manufacturing startups, and sector/stage agnostic startups, he added.

There will be operational flexibilities, including higher government contribution in AlFs (alternative investment funds) funding deep tech and high-tech manufacturing, the minister said.

The Union Cabinet approved the scheme in a meeting on Friday.

The fund will encourage the long-term investing culture and patient capital.

The government in 2016 had constituted a Fund of Funds worth Rs 10,000 crore to provide seed capital and enable startups take calculated risks.

Following the successful utilisation of the first tranche, a second phase of Rs 10,000 crore was sanctioned in the Union Budget for 2025-26.

So far, over 2 lakh entities are recognised as startups by the Department for Promotion of Industry and Internal Trade (DPIIT). These entities are eligible for incentives under the Startup India action plan.