The Department for Promotion of Industry and Internal Trade (DPIIT) has formally notified the Startup India Fund of Funds 2.0 (FoF 2.0), marking a renewed push to strengthen the country’s startup ecosystem. The initiative aims to provide structured capital support to emerging businesses and accelerate innovation across sectors.
The newly introduced fund comes with a total allocation of ₹10,000 crore and is expected to unlock fresh investment opportunities. By acting as a catalyst, the government intends to attract larger participation from private investors and venture capital firms.
Unlike direct funding mechanisms, FoF 2.0 will invest in SEBI-registered Alternative Investment Funds (AIFs), which will further channel capital into startups. This indirect approach allows professional fund managers to make investment decisions while ensuring a broader and more diversified funding reach.
Officials have indicated that the focus of the second phase will be on addressing funding gaps, especially for startups at the growth stage. While early-stage ventures in India have seen consistent funding inflows, scaling businesses often struggle to secure larger rounds needed for expansion.
The initiative builds on the earlier Fund of Funds programme under Startup India, which played a key role in supporting early-stage innovation. Through policy support, incentives, and funding access, the broader programme has contributed to the rise of a vibrant startup landscape in the country.
With the notification now in place, implementation of FoF 2.0 is expected to gain momentum in the coming months. Market participants believe the move could boost investor confidence and strengthen India’s position as a global hub for startups and entrepreneurship.
