India’s startup ecosystem has received a fresh wave of encouragement with the approval of the Rs 10000 crore Fund of Funds 2.0, a move that industry leaders believe will strengthen the foundation of innovation driven growth in the country. Among those who have welcomed the initiative is Sanjeev Bikhchandani, Founder and Executive Vice Chairman of Info Edge, who described the development as a significant milestone in India’s entrepreneurial journey.
The Fund of Funds 2.0 builds on the earlier Startup India Fund of Funds framework that was launched to catalyse venture capital investments in emerging companies. Instead of investing directly into startups, the government allocates capital to SEBI registered alternative investment funds, which then deploy money into promising ventures. This structure has helped crowd in private capital while ensuring professional fund management and diversified investment decisions.
According to Bikhchandani, the renewed commitment signals long term intent to nurture domestic capital pools and reduce excessive dependence on foreign funding. In recent years, fluctuations in global capital flows have exposed vulnerabilities in the startup ecosystem. A stronger domestic funding base can provide stability and patient capital, especially for sectors such as deep technology, advanced manufacturing, and research driven innovation that require longer gestation periods.
The Rs 10000 crore allocation is expected to encourage investments beyond traditional startup hubs and into emerging regions. As more founders arise from smaller cities and diverse backgrounds, access to structured funding support becomes crucial. Industry experts believe that broadening the geographical reach of capital can unlock untapped entrepreneurial potential and create more balanced economic growth.
India’s startup landscape has expanded dramatically over the past decade, with thousands of recognised startups and a growing number of unicorns. However, scaling sustainable businesses remains a challenge, particularly in capital intensive and technology heavy sectors. Fund of Funds 2.0 aims to address this by enabling venture funds to back innovative ideas that can compete globally while creating jobs and intellectual property within the country.
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