The government has disbursed Rs 2,900 crore under the Startup India programme so far, turning into nearly four times as much funding to popular ventures such as CureFit, Dunzo, Unacademy, Zostel, Uniphore, FreshToHome, Jumbotail, Zetwerk, and others. The government’s Fund of Funds for Startups disbursed this money to 63 Sebi-registered private Alternate Investment Funds, which in turn invested Rs 11,206 crore into 720 startup firms. “Performing startups supported through FFS are showing valuation increase by more than 10 times with a number of them even achieving unicorn status,” the Ministry of Commerce and Industry said in a statement.
The Fund of Funds for Startups was launched in 2016 under the Start-up India Initiative. It has a corpus of Rs 10,000 crore, and has committed a sum of Rs 7,385 crore to 88 AlFs. Some of the leading AIFs among those backed by FFS are India Quotient, Blume Ventures, Waterbridge, JM Financial, Fireside Ventures, Chirtate Ventures, Aavishkaar, IvyCap, and Omnivore. The investments made by the Alternate Investment Funds is 3.7 times of the government’s disbursements under the scheme – far higher than the minimum stipulated two times.
The corpus dedicated to the FFS was supported by the Department for Promotion of Industry and Internal Trade (DPIIT) and the Ministry of Commerce & Industry. The collective corpus that the AIFs supported by FFS are aiming for is more than Rs 48,000 crore. The amount fuelling the developments of various startups will not only support the startups at the early, seed, and growth stage but also facilitate the ventures in reducing dependence on foreign capital, raising domestic capital, among other things, the government said.
The capital committed under the FFS reflected a CAGR of 21 per cent since the launch of the scheme. It has also worked positively for the Small Industries Development Bank of India (SIDBI), the institution working the mechanics behind the scheme. In addition, aligned with the FFS’s core objective of setting up investment funds for Indian startups, out of the total number, 38 AIFs are foraying into venture investment for the first time.