Fund of Funds committed for AIFs under Startup India by the Government!
The union government under the ambitious Startup India Program has committed a corpus of ₹7,385 crores to 88 Alternative Investment Funds (AIFs). The announcement was made by the Ministry of Commerce and Industry. These AIFs are said to have invested the amount of ₹11,206 crores in 720 startups. The FFS has been announced as of 24 September this year.
According to the commerce and industry ministry, “FFS has been playing a monumental role in mobilizing domestic capital in the Indian startup ecosystem”.
The Startup India Initiative was launched in 2016 by Prime Minister Narendra Modi and a corpus of 10,000 crores was announced for the development of the startup infrastructure and ecosystem in India, out of which ₹7,385 crores has now been allocated to the AIFs.
The ministry said that some of the notable startups like Dunzo, CureFit, FreshToHome, Jumbotail, Unacademy, Uniphore, Vogo, Zostel and Zetwerk are funded through FFS. The ministry has also listed some of the leading startup investment companies like Chiratae Ventures, India Quotient, Blume Ventures, IvyCap, Waterbridge, Omnivore, Aavishkaar, JM Financial, and Fireside Ventures, which are supported under FFS. The AIFs which are benefited under FFS are registered with SEBI.
This step by the government has made the availability of capital easier for startups at all the stages, starting from the early stage to seed stage, and then to growth stage. It has also reduced dependence on foreign capital by facilitating the raising of domestic capital.
The ministry said, “the amount committed under FFS has seen notable growth over the years, recording a CAGR of over 21% since the launch of the scheme. FFS has helped anchor 67 AIFs out of 88 AIFs supported and 38 of these are first-time fund managers, which is in line with FFS’s core objective of anchoring venture capital investments for Indian startups.The returns generated from the success of these startups and the innovation created will remain within the country and facilitate the generation of employment and the creation of wealth.”