The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the establishment of Startup India Fund of Funds 2.0 with a total corpus of Rs. 10,000 crore (over $118 million) to mobilize venture capital for India’s startup ecosystem.
Announced by PIB Delhi, the scheme aims to accelerate the next phase of India’s startup journey by mobilizing long-term domestic capital, strengthening the venture capital ecosystem, and supporting innovation-led entrepreneurship nationwide.
Launched under the Startup India initiative, the new Fund builds on nearly a decade of efforts to position India as a leading startup nation. Since the launch of Startup India in 2016, the ecosystem has grown from fewer than 500 startups to more than 2 lakh (200,000) startups recognized by the Department for Promotion of Industry and Internal Trade. The year 2025 marked the highest-ever annual startup registrations.
The Startup India Fund of Funds 2.0 follows the performance of the original Fund of Funds for Startups, launched in 2016 to address funding gaps and catalyze the domestic venture capital market. Under Fund of Funds for Startups 1.0, the entire corpus of Rs. 10,000 crore was committed to 145 Alternative Investment Funds.
These supported funds have collectively invested more than Rs. 25,500 crore (over $2.8 million) in over 1,370 startups across sectors, including agriculture, artificial intelligence, robotics, automotive, clean tech, consumer goods and services, e-commerce, education, fintech, food and beverages, healthcare, manufacturing, space tech, and biotechnology.
Fund of Funds for Startups 1.0 played a pivotal role in nurturing first-time founders, crowding in private capital, and laying a strong foundation for India’s venture capital ecosystem.
The new Fund of Funds 2.0 is designed for a more targeted, segmented funding approach. It will prioritize deep-tech and tech-driven, innovative manufacturing startups, particularly those requiring patient, long-term capital. It also aims to support early-growth stage founders by addressing high-risk capital gaps that often lead to early-stage failures.
In addition, the scheme seeks to encourage investment beyond major metropolitan hubs, promoting innovation across the country. It is also intended to strengthen India’s domestic venture capital base, especially smaller funds, to further boost the domestic investment landscape.
The government expects Startup India Fund of Funds 2.0 to play a critical role in advancing India’s innovation-led growth agenda. By backing startups building globally competitive technologies, products, and solutions, the Fund is expected to strengthen economic resilience, enhance manufacturing capabilities, generate high-quality jobs, and position India as a global innovation hub.
Aligned with the national vision of Viksit Bharat @ 2047, the Fund underscores the government’s continued focus on empowering entrepreneurs, fostering innovation, and unlocking the full potential of India’s startup ecosystem.
