Commerce Ministry notifies Rs 945 crore seed fund for startups

3AI February 2, 2021

DPIIT said that preference would be given to startups offering solutions in sectors including social impact, waste management, water management, financial inclusion, education, agriculture, food processing, biotechnology, healthcare, energy, mobility, defence, space, railways, oil and gas, textiles, etc.

The government has approved the Rs 945-crore Startup India Seed Fund Scheme (SISFS) for the period 2021-25 to offer early-stage funding to startups for “proof of concept, prototype development, product trials, market entry and commercialization,” implementing body Department for Promotion of Industry and Internal Trade (DPIIT) said in its notification. Startups across sectors registered with the DPIIT and incorporated not more than two years ago at the time of applying for the scheme will be eligible for securing capital. The funding will be disbursed through selected incubators assisted by the central government or state governments.

“We are on course to implement the scheme wef 1 April ‘21,” DPIIT Joint Secretary Anil Agrawal tweeted on Friday. Prime Minister Narendra Modi had earlier this month announced the seed fund at the Startup India’s international summit Prarambh. In his address, PM Modi had said that the government is taking steps to ensure that there is no shortage of capital for startups and that the government will also help startups to raise debt capital ahead by providing the guarantee.

Apart from the two-year incorporation window, DPIIT said that preference would be given to startups offering solutions in sectors including social impact, waste management, water management, financial inclusion, education, agriculture, food processing, biotechnology, healthcare, energy, mobility, defence, space, railways, oil and gas, textiles, etc. Also, eligible startups should not have received over Rs 10 lakh of monetary support under any other Central or State Government scheme and that founders should have at least 51 per cent stake at the time of application to the incubator for the scheme.

The selected incubators will disburse up to Rs 20 lakhs as grant to startups for their validation of proof of concept, or prototype development, or product trials. This grant will be disbursed in milestone-based installments that can be related to the development of prototype, product testing, building a product ready for market launch, etc. Further, up to Rs 50 lakhs will be offered to startups for market entry, commercialization, or scaling up through convertible debentures or debt or debt-linked instruments.

The government also announced eligibility criteria for incubators assisted by the central government or state governments to participate in the scheme that included at least two years of operability on the date of applying for the scheme, capacity to seat at least 25 individuals, at least five startups undergoing incubation at the time of application of the scheme. The scheme will be executed and monitored by an Experts Advisory Committee (EAC) to be set-up by DPIIT. EAC will evaluate incubators to provide grants of up to Rs 5 crore in milestone-based three or more installments.

Picture from freepik.com

IoT devices at risk from Amnesia:33

A new series of vulnerabilities dubbed Amnesia:33 puts millions of IoT devices at risk of being compromised. Security researchers from Forescout disclosed the 33 vulnerabilities today. The flaws are found in four open-source TCP/IP libraries used in the firmware of products from over 150 vendors. According to the researchers’ estimates, millions of consumer and […]

Process Mining and Task Mining fuels Automation across the Enterprise

Featured Article: Author: Prakash Narayanan, Head of RPA & Intelligent Automation, Cyient Every business is a collection of core processes. Processes are the foundational infrastructure and form the basic element of business operations. In 1911, Frederick Winslow Taylor became the first person to study and optimize workplace productivity. His monograph ‘The Principles of Scientific Management’ […]

Lessons in Failing to Apply Blockchain to combat C19

This year 2020 has seen quite a variety of exciting developments in the blockchain space. To name just a few: the emergence of decentralized finance (DeFi) and non-fungible tokens (NFTs) as major economic forces and sources of crypto network user tractions, the maturation of layer 2 Ethereum solutions and the rollout of a variety of […]

Creating the Bridge of Translation between AI Technologists and Business

Featured Article: Author: Abhishek Tandon, Director, Customer Success for Fosfor, LTIMindtree Like we saw in the previous article “Crossing the AI Adoption Chasm“, there is a big gap in the objective of the technologists driving the AI project and the business user seeking value from it. This gap is causing major adoption issues as both […]

India's largest platform and marketplace for GCC & AI leaders and professionals

3AI Digital Library