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

Role of Generative AI in the Realm of Generative AI

Featured Article: Author: Ramana Kompally, Director – Data & Analytics, Cloudsufi Generative Artificial Intelligence (AI) has taken the world by storm and every organization is looking forward to having a pie in the cake and augmenting the portfolio. While a plethora of applications is being envisaged using Generative AI (Gen AI), there is one niche […]

Practical insights and best practices for Fine Tuned LLM based use cases for Governed Enterprises

Featured Article: Author: Aditya Khandekar, President, Corridor Platforms India Objective There has been a lot of hype around Large Language Models (LLM) and their potential, but harnessing them to build real-world enterprise grade use cases is hard. This blog highlights key best practices and insights for building LLM powered use cases with a working example. […]

Salesforce embraces the public cloud with Hyperforce

Salesforce is letting CIOs choose where they run its software, easing compliance with data protection and data sovereignty laws. Salesforce.com President and COO Bret Taylor believes the SaaS vendor has made “probably the most significant technological shift” since its CRM platform first launched 21 years ago. But Taylor wasn’t talking about the company’s agreement to acquire […]

ChatGPT and Large Language Models: A prioritization Framework for Leaders

Featured Article: Author: Robin John, Artificial Intelligence Strategist, APAC, Kimberly-Clark Ever since ChatGPT was released last year, a flurry of LLM(Large Language Model) – related product announcements from tech giants have taken the world by storm. The key driving factor behind the success of ChatGPT is its human-like interface into AI. A technique called Reinforcement […]

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

3AI Digital Library