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Startup India Fund of Funds 2.0 (FOF 2.0) has received approval from the Union Cabinet, featuring a significant corpus of Rs 10,000 crore intended to bolster startups through venture capital funds. This new fund is set to enhance the previous Fund of Funds for Startups (FFS) that was introduced in 2016. The initial fund saw a commitment of Rs 10,000 crore towards 145 alternative investment funds, which collectively invested more than Rs 25,000 crore in over 1,300 startups spanning various sectors. FOF 2.0 will persist in investing in SEBI-registered alternative investment funds, which will subsequently channel capital into startups. This initiative aims to fill funding voids, particularly in early-growth and technology-focused sectors. The new fund will prioritise domains such as deep tech, manufacturing, and innovation-driven enterprises. Furthermore, it strives to enhance the domestic venture capital ecosystem and broaden access to capital outside major metropolitan areas. According to the report, India currently boasts over 2 lakh recognised startups, a significant increase from fewer than 500 in 2016 when the Startup India initiative was first launched.
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