Fund of Funds for Startups (FFS), launched under the Startup India initiative, has committed Rs. 7,385 crores to 88 Alternative Investment Funds (AIFs), up till September 24th, 2022, as per the Ministry of Commerce & Industry. These AIFs, in turn, have invested Rs. 11,206 crores in 720 startups.
The FFS was launched with a corpus of Rs. 10,000 crores, to be built up over the 14th and 15th Finance Commission Cycles (FY 2016-2020 and FY 2021-2025) through budgetary support by the Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce & Industry, Government of India. Under the Scheme, support is extended to SEBI registered Alternative Investment Funds (AIFs), which in turn invest in startups.
As per the Ministry, amount committed under FFS has seen notable growth over the years, recording a CAGR of over 21% since the launch of the Scheme. Further, the Small Industries Development Bank of India (SIDBI) which is responsible for operationalising the Scheme has undertaken a series of reforms recently to expedite the drawdowns to enable AIFs assisted under FFS to avail accelerated drawdowns. This has created a positive impact and has resulted in year on year (Q1 FY 2021-22 vis-à-vis Q1 FY 2022-23) surge of 100% in the number of drawdowns.
So far, FFS has helped anchor 67 AIFs out of 88 AIFs supported and 38 of these are first-time fund managers.