The ‘superpower’ of India startups! Central government approves Rs 10,000 crore fund, new ideas will get wings
- 10 thousand crore strong support from the government
- Government’s Master Plan to Make India a Startup Superpower
- Startups will get thousands of crores of funds
The central government has approved a fund of Rs 10,000 crore for the development of startups. This includes raising venture capital for startups, supporting deep tech, technology-based innovative product startups and early growth stage ventures. This was the second phase of the Fund of Funds scheme under the Startup India initiative. The first phase was established in 2016.
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FoF 2.0 is designed to sustain the momentum of investment in startups, with scope far beyond that of FoF 1.0. The Union Cabinet chaired by Prime Minister Narendra Modi has approved setting up of Startup India Fund of Funds 2.0 with a total of Rs 10,000 crore to mobilize venture capital for the country’s startup ecosystem, a government statement said. (Photo Courtesy – Pinterest)
Second phase approved
The Cabinet on Friday approved the second phase of the Startup India Fund of Funds scheme. It said the scheme is designed to accelerate the next phase of India’s startup journey by mobilizing long-term domestic capital, strengthening the venture capital ecosystem and supporting innovation-driven entrepreneurship across the country. In 2016, the government set up a Rs 10,000 crore fund of funds to provide seed capital to startups and enable them to take calculated risks.
After the successful implementation of the first phase, the second phase of Rs 10,000 crore was sanctioned in the Union Budget 2025-26. Currently, there are approximately 100 unicorn startups. Unicorns are startups valued at US$1 billion or more. Since the launch of Startup India in 2016, the number of startups approved by the government has grown from approximately 500 to over 200,000. More than 49,400 startups were approved in 2025, the highest number in a single year.
Launched after strong performance Startup India Fund of Funds 2.0 follows the strong performance of Fund of Funds for Startups, which was launched in 2016 to bridge the funding gap and boost the domestic venture capital market for startups. As part of this fund, a total of Rs 10,000 crore+ has been allocated to 145 alternative investment funds.
Promoting startups in every corner
Moreover, investment will be encouraged beyond the big metros to spur innovation in every corner of the country. The statement said it is designed to strengthen India’s domestic venture capital base, particularly small funds, to address the shortage of high risk capital and further boost the domestic investment landscape. Startup India FOF 2.0 will be an empowered committee to provide guidance and guidelines. Recently, the government has increased the criteria for recognizing organizations as startups, doubling the turnover limit to Rs 200 crore.
Encouraging New Entrepreneurs The fund has played an important role in encouraging new entrepreneurs, mobilizing private capital and laying a strong foundation for India’s venture capital ecosystem. While the first phase created the ecosystem, the second phase aims to take Indian innovation to the next level.
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The new fund will adopt a targeted, sectorial financing approach to support deep technology and technology-based innovative products, prioritizing important breakthroughs in high-tech sectors that require long-term capital, its primary objective will also be to enable early growth stage founders to provide a safety net for new and innovative ideas and mitigate early failures due to lack of funding.
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