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SIDBI Clears ₹930 Crore To Support VC Funds Focused On Early-Stage Startups

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Earlier this year, Indian government announced a new program dubbed as “Startup India, Stand-up India” with an aim to make India a startup hub by 2022. Now, the program has got a boost as Small Industries Development Bank of India (SIDBI) has cleared ₹930 crore.

The amount has been cleared from a ₹2,000 crore fund-of-funds it launched in August this year in order to support venture capital funds.

The India Aspiration Fund, which was launched by the Finance Minister  – Arun Jaitley, would invest in venture capital funds for meeting the equity requirement of MSME start-ups. It has screened 30 venture capital funds since its launch and has already issued sanction letters to more than half of them.

Kshatrapati Shivaji, SIDBI’s Chairman and Managing Director, told ET,

Proposals from 24 venture capital funds for an aggregate commitment of Rs 930 crore have been cleared in principle by the venture capital investment committee (VCIC) so far, out of which sanction letters have already been issued to 16 VCFs with an aggregate commitment of Rs 482 crore, where documentation is in progress.

According to Shivaji, the support under fund-of-funds operations in sector and stage-agnostic. It has been extended to funds which are focused on seed, early and growth-stage startups as well as social ventures.

Also, more than a dozen proposals have been lined up for a further potential commitment of around Rs 500 crore for the consideration of VCIC, a panel of experts in various segments who are advising SIDBI for venture funds. The panel includes Saurabh Srivastava, TV Mohandas Pai, Sanjeev Bikchandani, Kiran Karnik, Harkesh Mittal and Vaidyanathan. The panel also also includes two senior executives from SIDBI.

The venture funds that received support from Small Industry Development Bank through India Aspiration Fund includes Blume Ventures, Orios Venture Partners, YourNest Angel Fund, Ivy Capital and Infuse Ventures, among others.

According to TV Mohandas Pai, the fund-of-funds has an ability to create a huge impact in the future as it is aimed at supporting early-stage and seed-funding stage startup.


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