Cabinet Approves Startup India FoF 2.0
In News
What Happened
Why It Matters
Background
History & Context
What Changed
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Sector Focus: BEFORE, FFS 1.0 was largely sector-agnostic, supporting startups across various consumer and enterprise domains. NOW, FoF 2.0 adopts a targeted approach, deliberately channeling capital into deep tech and tech-driven innovative manufacturing.
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Stage Prioritization: BEFORE, funds were broadly distributed across early-stage seed and Series A rounds. NOW, there is a specialized emphasis on early-growth stage startups that typically face critical "valley of death" funding gaps.
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Allocation Strategy: BEFORE, capital allocation to AIFs lacked strict sectoral carve-outs. NOW, the segmented approach ensures dedicated tranches of venture capital are reserved for high-risk, strategically important technologies.
Prelims Angle
NCERT Connection
Practice Questions
Q1
Correct Statement(s)Which of the following statements regarding the Startup India Fund of Funds (FoF) is/are correct? 1. The fund operates by directly investing equity capital into early-stage startups via DPIIT. 2. The second iteration (FoF 2.0) has shifted focus to specifically prioritize deep tech and tech-driven innovative manufacturing startups.