{"id":28750,"date":"2021-04-09T11:51:37","date_gmt":"2021-04-09T06:21:37","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=28750"},"modified":"2021-04-09T11:51:39","modified_gmt":"2021-04-09T06:21:39","slug":"startup-india-seed-fund-scheme","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/startup-india-seed-fund-scheme\/","title":{"rendered":"Startup India Seed Fund Scheme: Objectives, Guidelines, and Eligibility Criteria"},"content":{"rendered":"\n<p class=\"has-drop-cap\">Easy availability of funding is imperative for\nstartups at the early stages of growth. Funding from venture capital or angel\ninvestors is accessible to startups only after the proof of the business\nconcept. Likewise, banks provide credits only to asset-backed up applicants. It\nis imperative to facilitate seed funding to startups with a unique idea to\nconduct proof of concept trials.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/startup-india-seed-fund-scheme\/#What_is_the_Aim_of_Startup_India_Seed_Fund_Scheme\" >What is the Aim of Startup India Seed Fund Scheme?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/startup-india-seed-fund-scheme\/#Why_Government_Introduce_Startup_India_Seed_Fund_Scheme\" >Why\nGovernment Introduce Startup India Seed Fund Scheme?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/startup-india-seed-fund-scheme\/#Eligibility_Criteria_for_Startups_to_Avail_Startup_India_Seed_Fund_Scheme\" >Eligibility\nCriteria for Startups to Avail Startup India Seed Fund Scheme<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/startup-india-seed-fund-scheme\/#Eligibility_Criteria_for_Incubators_to_Avail_Startup_India_Seed_Fund_Scheme\" >Eligibility\nCriteria for Incubators to Avail Startup India Seed Fund Scheme<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/corpbiz.io\/learning\/startup-india-seed-fund-scheme\/#What_are_the_Committees_are_Brought_to_Regulate_the_Startup_India_Seed_Fund_Scheme\" >What\nare the Committees are Brought to Regulate the Startup India Seed Fund Scheme?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/corpbiz.io\/learning\/startup-india-seed-fund-scheme\/#Disbursement_of_Seed_Funds_under_Startup_India_Seed_Fund_Scheme\" >Disbursement\nof Seed Funds under Startup India Seed Fund Scheme<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/corpbiz.io\/learning\/startup-india-seed-fund-scheme\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_Aim_of_Startup_India_Seed_Fund_Scheme\"><\/span>What is the Aim of Startup India Seed Fund Scheme? <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><a href=\"https:\/\/corpbiz.io\/startup-india-registration\"><strong>Startup India<\/strong><\/a> Seed Fund Scheme (SISFS) envisages facilitating fiscal aid to startups for proof of concept, product trials, prototype development, commercialization, and market entry.<\/p>\n\n\n\n<p>This would empower startups to reach to phase\nwhere they can procure funding from venture capitalists or angel investors or\nseek credits from financial institutions or commercial banks. The seed fund\nwill be available to startups via eligible incubators across India.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Why_Government_Introduce_Startup_India_Seed_Fund_Scheme\"><\/span>Why\nGovernment Introduce Startup India Seed Fund Scheme?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Most startups encounter capital shortage in\nthe seed &amp; &#8216;Proof of Concept phase. The capital required at this particular\nphase offers for make or break situation for startups having innovative\nbusiness ideas.<\/p>\n\n\n\n<p>Many business ideas encounter failure in their\ninitial stage due to the lack of this critical capital required for proof of\nconcept, product trials, prototype development, and commercialization. Seed\nfunds provided to such cases might have a multiplier effect on the business\nideas of many startups, leading to job creation.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Eligibility_Criteria_for_Startups_to_Avail_Startup_India_Seed_Fund_Scheme\"><\/span>Eligibility\nCriteria for Startups to Avail Startup India Seed Fund Scheme<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><em><strong>Startup India Seed Fund Scheme shall be available to the following eligible candidates:-<\/strong><\/em><\/p>\n\n\n\n<ul><li>A startup with two years of service life and recognized by DPIIT qualify for this scheme.<\/li><li>Startup must have a viable business idea that embraces commercialization, the scope of scaling, and market fit.<\/li><li>Startup must be using technology in its business model or methodology to resolve the issue being targeted.<\/li><li>Preference would be given to innovative solutions in water management, education, healthcare, railways, financial inclusion, defense, textiles, mobility, biotechnology, and energy.<\/li><li>Startups should not receive monetary support of more than INR 10 lakh under other Central or State Government schemes. This does not include subsidized working space, access to labs, access to prototyping facility, founder monthly allowance, or prize money from competitions.<\/li><li>Shareholding held by promoters in the startup must be at least 51% at the event of application filing to the incubator, as per SEBI (ICDR) Regulations, 2018 and Companies Act, 2013<\/li><li>Any startup will not have access to seed support more than once, as mentioned in the provisions of para 8.1 (i) and 8.1 (ii), respectively<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Eligibility_Criteria_for_Incubators_to_Avail_Startup_India_Seed_Fund_Scheme\"><\/span>Eligibility\nCriteria for Incubators to Avail Startup India Seed Fund Scheme<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><em><strong>Startup India Seed Fund Scheme shall be accessible to the following incubator in India:<\/strong><\/em><\/p>\n\n\n\n<ul><li>Incubator must be registered as a legal entity:<\/li><li>A society working under the Societies Registration Act 1860, or<\/li><li>A Trust working under Indian Trusts Act 1882, or<\/li><li>A Private Limited company working under Companies Act 1956 of the Companies Act 2013, or<\/li><li>A statutory body established via Act of the legislature<\/li><li>Incubator should serve two years of service life on the date of application.<\/li><li>Incubator must have a sitting arrangement for at least 25 individuals.<\/li><li>Incubator should have at least five startups actively serving incubation phase on the date of application,<\/li><li>Incubator must have a proper workforce managed by a full-time Chief Executive Officer who has experience in entrepreneurship and business development. The team should be actively working on testing &amp; validating the idea for the startups.<\/li><li>Incubators should not be providing seed funds to incubates via a third-party private entity.<\/li><li>Incubator must have the back up of Central\/State Government(s)<\/li><\/ul>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/process-of-startup-india-registration-online\/\">Process of Startup India Registration: A Step by Step Guide<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_Committees_are_Brought_to_Regulate_the_Startup_India_Seed_Fund_Scheme\"><\/span>What\nare the Committees are Brought to Regulate the Startup India Seed Fund Scheme?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>Committees that are brought to Regulate the Startup India Seed Fund Scheme are given bellow:-<\/em><\/strong><\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img decoding=\"async\" src=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/04\/What-are-the-Committees-are-Brought-to-Regulate-the-Startup-India-Seed-Fund-Scheme-1024x453.png\" alt=\"Committees are Brought to Regulate the Startup India Seed Fund Scheme\" class=\"wp-image-28753\" width=\"562\" height=\"248\" srcset=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/04\/What-are-the-Committees-are-Brought-to-Regulate-the-Startup-India-Seed-Fund-Scheme-1024x453.png 1024w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/04\/What-are-the-Committees-are-Brought-to-Regulate-the-Startup-India-Seed-Fund-Scheme-300x133.png 300w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/04\/What-are-the-Committees-are-Brought-to-Regulate-the-Startup-India-Seed-Fund-Scheme-768x340.png 768w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/04\/What-are-the-Committees-are-Brought-to-Regulate-the-Startup-India-Seed-Fund-Scheme.png 1080w\" sizes=\"(max-width: 562px) 100vw, 562px\" \/><\/figure><\/div>\n\n\n\n<h3 class=\"wp-block-heading\">Role of the Experts Advisory\nCommittee (EAC) <\/h3>\n\n\n\n<p>An Experts Advisory Committee (EAC) will be\nset up by DPIIT, which will be accountable for the overall functioning &amp;\ntracking of the Startup India Seed Fund Scheme<strong>. <\/strong>The EAC will analyze and chooseincubators for seed\nfund&#8217;s allotment, tracking progress, and take required steps to ensure\nefficient utilization of funds to fulfill the scheme&#8217;s objectives. The following\nmembers will be serving the Experts Advisory Committee (EAC)<\/p>\n\n\n\n<ul><li>Chairman, an individual of eminence<\/li><li>Financial Advisor, DPIIT, or his\nrepresentative<\/li><li>Additional Secretary\/ Joint Secretary\/\nDirector\/ Deputy Secretary, DPIIT (Convener)<\/li><li>Representative of Department of\nBiotechnology (DBT)<\/li><li>Representative of Department of\nScience &amp; Technology (DST)<\/li><li>Representative of Ministry of\nElectronics and Information Technology (MeiTY)<\/li><li>Representative of Indian Council of\nAgricultural Research (ICAR)<\/li><li>Representative of NITI Aayog<\/li><\/ul>\n\n\n\n<div class=\"shadow1\"><strong>Note:<\/strong> Experts Advisory Committee (EAC) will also encourage by at least three expert members selected by Secretary DPIIT from the relevant domains such as research and development, entrepreneurship, technology development, and commercialization.<\/div>\n\n\n\n<h3 class=\"wp-block-heading\">Establishment of Incubator Seed Management Committee (ISMC)<\/h3>\n\n\n\n<p>Every incubator that opts for Startup India\nSeed Fund Scheme will have set up a committee known as Incubator Seed\nManagement Committee (ISMC), which will be served by an expert who can analyze\nand choose startups for seed support. The ISMC should be comprised of the\nfollowing members:-<\/p>\n\n\n\n<ul><li>Nominee of Incubator (Chairman)<\/li><li>A representative from State\nGovernment&#8217;s Startup Nodal Team<\/li><li>Representative of a Venture Capital\nFund or Angel Network<\/li><li>A domain expert from Industry<\/li><li>A domain expert from academia<\/li><li>Two successful Entrepreneurs<\/li><li>Any other relevant Stakeholder<\/li><\/ul>\n\n\n\n<p>EAC shall approve the final composition &amp;\nmembers of ISMC. It will be an essential parameter in the incubator&#8217;s\nselection.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Disbursement_of_Seed_Funds_under_Startup_India_Seed_Fund_Scheme\"><\/span>Disbursement\nof Seed Funds under Startup India Seed Fund Scheme<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>ISMC-selected incubators shall carry out funding distribution activities in the following manner:-<\/em><\/strong><\/p>\n\n\n\n<ul><li>Up to Rs 20 lakhs of investment will be granted to validate\nproof of concept, or product trials, or prototype development.<\/li><li>Up to Rs 50 lakhs of investment will be allocated for\ncommercialization, market-entry, or scaling up via convertible debentures or\ndebt-linked instruments.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Startups are prohibited from using such\ninvestment for the purpose other than mentioned under the scheme. Startup India\nSeed Fund Scheme seems to be a groundbreaking initiative for startups across\nthis country. With this scheme in place, startups do not have to drill down\ndifferent financing options to bolster their idea.<\/p>\n\n\n\n<p>The scheme will empower startups to capitalize on their business idea and achieve their goals. Through this scheme, <em><strong>Government<\/strong><\/em><sup><a href=\"https:\/\/en.wikipedia.org\/wiki\/Government\"><em><strong>[1]<\/strong><\/em><\/a><\/sup> envisages promoting innovation that benefits society or individuals in one way or another. The distribution of funds that will take place under this scheme seems systematic and free from any discrepancies.\u00a0\u00a0<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/benefits-of-startup-india-registration-in-india\/\">Benefits of Startup India Registration in India<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Easy availability of funding is imperative for startups at the early stages of growth. Funding from venture capital or angel investors is accessible to startups only after the proof of the business concept. Likewise, banks provide credits only to asset-backed up applicants. It is imperative to facilitate seed funding to startups with a unique idea [&hellip;]<\/p>\n","protected":false},"author":22,"featured_media":28759,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[968],"tags":[1654],"acf":{"service_id":"250"},"authorName":"Pankaj Tyagi","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2022\/01\/MicrosoftTeams-image-42.jpg","authorDescription":"Pankaj has a diverse experience of writing research papers, blog, and articles during his college time. Earlier, he was working as a tax consultant in a financial firm, but his interest in writing drives him to pursue a career in the writing field.","postViews":7700,"readingTime":4,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/28750"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/22"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=28750"}],"version-history":[{"count":11,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/28750\/revisions"}],"predecessor-version":[{"id":28765,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/28750\/revisions\/28765"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/28759"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=28750"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=28750"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=28750"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}