To strengthen venture capital, support innovation, and drive entrepreneurial growth, the Cabinet greenlighted Startup India Fund of Funds 2.0 with an outlay of ₹100 billion.
The Union Cabinet has approved the establishment of the Startup India Fund of Funds 2.0 (FoF 2.0), with a corpus of ₹100 billion aimed at mobilising venture capital for India’s startup ecosystem.
The initiative aims to accelerate the next phase of India’s startup growth by strengthening the domestic venture capital base, supporting innovation-led entrepreneurship, and addressing funding gaps in high-risk areas. It builds on the earlier Fund of Funds for Startups (FFS 1.0), launched in 2016 under the Startup India programme.
FFS 1.0 committed its entire ₹100 billion corpus to 145 alternative investment funds (AIFs), which collectively invested over ₹255 billion in more than 1370 startups across diverse sectors, including agriculture, artificial intelligence (AI), robotics, clean technology, healthcare, and space technology. The scheme was credited with nurturing first-time founders and crowding in private capital, laying the foundation for India’s venture capital ecosystem.
FoF 2.0 is designed to build on this progress with a more targeted approach. Key priorities include deep tech and advanced manufacturing, early‑growth stage founders, and extending investment reach beyond major metropolitan centres.
The scheme also aims to strengthen smaller domestic funds, reduce early-stage failures, and direct capital towards areas critical for self-reliance and economic growth.
Meanwhile, the government revealed that India’s startup ecosystem has expanded significantly since the launch of Startup India in 2016, growing from fewer than 500 recognised startups to over 200,000 registered with the Department for Promotion of Industry and Internal Trade (DPIIT). The year 2025 marked the highest annual registrations to date.
Aligned with the national vision of Viksit Bharat @ 2047, the government expects FoF 2.0 to play a central role in advancing innovation-led growth, strengthening manufacturing capabilities, and generating employment.
