The Union Cabinet has approved the Startup India Fund of Funds 2.0 (Startup India FoF 2.0) with a total corpus of Rs 10,000 crore to mobilise venture capital for the country’s startup ecosystem.
The scheme is aimed at accelerating the next phase of India’s startup growth by mobilising long-term domestic capital, strengthening the venture capital ecosystem and supporting innovation-led entrepreneurship across sectors.
The fund builds on the Startup India initiative launched in 2016, under which India’s startup ecosystem has expanded from fewer than 500 startups to over 2 lakh Department for Promotion of Industry and Internal Trade (DPIIT)-recognised startups. The year 2025 recorded the highest-ever annual startup registrations.
Startup India FoF 2.0 follows the Fund of Funds for Startups (FFS 1.0), launched in 2016 to bridge funding gaps and catalyse the domestic venture capital market.
Under FFS 1.0, the entire Rs 10,000 crore corpus was committed to 145 Alternative Investment Funds (AIFs). These AIFs have invested over Rs 25,500 crore in more than 1,370 startups across sectors including agriculture, artificial intelligence, robotics, automotive, clean tech, consumer services, e-commerce, education, fintech, healthcare, manufacturing, space tech and biotechnology.
The first phase helped nurture first-time founders, crowd in private capital and strengthen the domestic venture capital ecosystem.
Focus on deep tech, manufacturing and early-stage innovation
Startup India FoF 2.0 will follow a targeted and segmented funding approach, focusing on:
- Deep tech and tech-driven innovative manufacturing requiring long-term capital
- Early-growth stage founders to reduce funding-linked early failures
- Wider national reach beyond major metro startup hubs
- Addressing high-risk capital gaps in priority sectors
- Strengthening domestic venture capital, especially smaller funds
The fund is expected to support startups building globally competitive technologies, products and solutions, while boosting manufacturing, job creation and innovation-led growth.
The government said the fund aligns with the Viksit Bharat @ 2047 vision, and is aimed at strengthening India’s economic resilience, innovation capacity and global competitiveness in emerging technologies and high-growth sectors.
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