Fund of Funds for Startups
The Fund of Funds for Startups (FFS) is a ₹10,000 crore government fund that invests in SEBI-registered venture capital funds (AIFs), which then invest in DPIIT-recognised startups. Managed by SIDBI under the Startup India programme, FFS has helped mobilise over ₹90,000 crore for Indian startups through a built-in multiplier: every ₹1 SIDBI puts in triggers at least ₹2 into startups.
About This Scheme
The Fund of Funds for Startups (FFS) is a ₹10,000 crore government fund that invests in SEBI-registered venture capital funds (AIFs), which then invest in DPIIT-recognised startups. Managed by SIDBI under the Startup India programme, FFS has helped mobilise over ₹90,000 crore for Indian startups through a built-in multiplier: every ₹1 SIDBI puts in triggers at least ₹2 into startups.
Full official description
To meet the funding needs of startups, Government of India has established Fund of Funds for Startup (FFS) under Startup India Programme. Corpus of the FFS is ₹10,000 crore. DPIIT, Government of India is the monitoring agency and SIDBI is the operating agency for FFS. As per the operating guidelines, FFS contributes to the corpus of SEBI registered Alternative Investment Funds (AIFs). These AIFs in turn have to invest at least twice the contribution under FFS, in ‘startups’ as defined by the Government of India gazette notification.
The objective of FFS is to provide equity support to startups and encourage innovation and entrepreneurship. It targets DPIIT-recognized startups working in technology, research, and innovation across various sectors. A key feature is the multiplier effect, AIFs must invest at least twice the amount contributed by SIDBI, ensuring more funds flow into the ecosystem.
Benefits include access to patient capital, mentorship, and industry networks. The scheme also boosts credibility for startups, making it easier to attract follow-on investments. With an initial corpus of ₹10,000 crore, FFS has supported thousands of startups and promoting innovation. Overall, it plays a vital role in building a strong venture capital market and driving India’s economic growth through entrepreneurship.
Benefits
- Equity/equity-linked funding for your startup through SEBI-registered Alternative Investment Funds (AIFs)
- Mentorship and market access from experienced fund managers with real portfolio networks
- Private investor connections — AIFs bring in co-investors beyond the government's contribution
- Multiplier effect: for every ₹1 SIDBI puts in, AIFs must invest at least ₹2 into startups
- Scale: The scheme has already helped mobilise over ₹90,000 crore for Indian startups
Who Can Apply (Eligibility)
FFS supports Alternative Investment Funds (AIFs) — not individual startups directly. To be eligible, your AIF must be SEBI-registered as Category I or II, have a corpus under ₹1,000 crore, and commit to investing at least twice SIDBI's contribution exclusively into DPIIT-recognised startups.
How to Apply
Step 1: Eligibility Screener and Registration Initial check to confirm applicant meets basic eligibility criteria and registration on the portal.
Step 2: Preliminary Questionnaire Collection of key details about the fund, strategy, and compliance for initial assessment.
Step 3: Feedback, Go / No-Go Questionnaire helps in decision making on whether the proposal moves forward based on preliminary review.
Step 4: First Meeting Introductory discussion to understand fund objectives, structure, and alignment with FFS goals.
Step 5: Detailed Application Submission of comprehensive documents including fund strategy, team credentials, and compliance.
Step 6: Due Diligence Completed Detailed evaluation of fund strategy, Fund manager past experience, governance, and operational aspects of the fund.
Step 7: Second Meeting, Feedback & Terms Discussion Discussion on due diligence findings and key terms & conditions.
Step 8: VCIC Appraisal Memo Submission Preparation and submission of Venture Capital Investment Committee (VCIC) appraisal summarizing evaluation and recommendations.
Step 9: Present to VCIC Investment Committee Formal presentation to the VCIC for approval and strategic fit assessment.
Step 10: SIDBI’s Executive Committee Final review and approval by SIDBI’s Executive Committee for sanctioning investment.
Step 11: Final Feedback, Post IC & EC, Issue of LOI Communication of decision and issuance of Letter of Intent (LoI) to the selected fund.
Step 12: Agreements Finalisation Drafting and signing of legal agreements to formalize the investment commitment.
Step 13: Onboarded for the Fund Lifecycle
Completion of onboarding and monitoring throughout the fund’s lifecycle.
Frequently Asked Questions
Does SIDBI charge any processing fee for evaluating proposals under FFS?
No, SIDBI does not charge any processing fee for evaluating proposals under the FFS programme.
Are category I Funds eligible under FFS?
Yes, all AIFs registered under SEBI AIF Regulations, 2012 (Category I and II) are eligible.
Is there any corpus limit for AIFs under FFS?
Yes, AIFs with a corpus of less than ₹1,000 crore are eligible for funding under the FFS scheme. Through modifications under FFS regulations, AIFs with a corpus exceeding ₹1,000 crore can also be supported, subject to the following conditions:
- IM must be a domestic entity.
- The IM or its key personnel should have previously managed funds to which SIDBI has committed in the past.
- SIDBI’s exposure to such funds will be capped at the same level applicable to funds with a corpus of ₹1,000 crore.
Does SIDBI or Government of India have a say in the investment decisions of the AIF?
No, investment decisions of investing in any startups are taken by the investment committee of respected AIF.
What are the general covenants for AIFs under FFS?
AIFs must maintain high standards of corporate governance, investor reporting, and comply with SEBI, RBI guidelines.
What is the definition of a Startup under FFS?
Age: Up to 10 years from incorporation/registration date. Turnover must not have exceeded ₹100 Crore in any financial year since incorporation. It must be incorporated as a Private Limited Company, a Registered Partnership Firm, or a Limited Liability Partnership (LLP) in India. Additionally, it is working towards innovation, development, or improvement of products, processes, or services, with potential for high scalability, employment generation, or wealth creation.
Are AIFs required to be registered with SEBI before approaching SIDBI?
Yes, SEBI registration is mandatory before applying to SIDBI.
Do startups under FFS need to be registered with the DPIIT?
Yes, its mandatory.
Is there any sector-specific eligibility for startups under FFS?
No, FFS is sector-agnostic.
Can AIFs invest in foreign entities under FFS?
Generally, investments should be in Indian entities. Investments abroad are allowed only as per SEBI/RBI guidelines, but they do not count toward the multiplier condition.
When must AIFs fulfill the condition of investing twice the amount received from FFS?
This condition must be met by the end of the commitment period of the Fund, with compliance status reported periodically.
What is the term of AIFs under FFS?
Typically, 8–10 years from Final Closing, not exceeding 12 years.
Can AIFs make warehoused investments before First Closing?
Yes, they can, and such investments can later be acquired by the Fund at cost without holding charges.
Who decides the investments under AIFs supported by FFS?
While the VCIC recommends the proposal, final decision of the investment is taken by Executive Committee of SIDBI.
What reporting and compliance requirements apply to AIFs under FFS?
AIFs must maintain proper records, appoint auditors acceptable to SIDBI, and comply with SEBI, RBI, and KYC norms.
Ready to apply?
Visit the official government portal to apply for this scheme.
Apply on myScheme.gov.inDocuments Required
- ) AIF registration certificate
- ) IM Agreement
- ) Past Track record (If any)
- ) PPM (Private Placement Memorandum)
- ) AIF and Fund’s Financials
- ) Trust Deed
- ) Contributors Details
- ) Startup Certificate
- ) KYC Documents (Aadhar Card, Pan Card (Individual and Company), Financials, CIBIL Score)
- In case of startups, please visit AIF’s website.