The government has overhauled the guidelines for its landmark ₹10,000 crore Startup India Fund of Funds to kickstart lagging venture investments. The revamped 'Fund of Funds 2.0' rules aim to streamline capital distribution and increase transparency.
₹10,000 crore
Fund Corpus
⏳ Time Machine
How today’s news fits into the bigger picture
2016
Startup India Fund launched
The Indian government establishes the original ₹10,000 crore Fund of Funds managed by SIDBI to support early-stage innovative startups.
2021
Deployment crosses 50%
Total committed capital under the fund crosses the ₹5,000 crore mark, backing hundreds of fast-growing startup enterprises.
March 2026
Funding winter bites hard
Annual startup reports show total funding into Indian startups declining 18% to $11.7 billion as foreign VCs pull back capital.
Today
DPIIT issues fresh guidelines for Startup India Fund of Funds 2.0.
What happens next?
SIDBI to distribute the revised allocation to over 50 domestic venture funds by next year.
To counter a harsh funding winter, the Department for Promotion of Industry and Internal Trade (DPIIT) has released updated guidelines for its massive ₹10,000 crore Startup India Fund of Funds (FFS) 2.0. On Saturday, July 25, 2026, the department issued a revised framework designed to accelerate the deployment of capital to Alternative Investment Funds (AIFs), which in turn invest in early-stage startups. This policy intervention comes as Indian startup funding fell 18% to $11.7 billion in the previous fiscal year. The new guidelines simplify the allocation process, reduce bureaucratic delays, and introduce stricter reporting requirements for venture capitalists. By reviving this critical sovereign fund, the government hopes to stimulate domestic venture capital and support the next generation of tech unicorns.
💭 If you're wondering…
It is a pool of capital that invests in other private venture capital funds instead of buying shares directly in individual startups.
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