{"id":39630,"date":"2022-01-28T12:30:54","date_gmt":"2022-01-28T07:00:54","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=39630"},"modified":"2022-01-28T12:31:27","modified_gmt":"2022-01-28T07:01:27","slug":"seed-funding-for-startups-an-initiative-by-the-government","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/seed-funding-for-startups-an-initiative-by-the-government\/","title":{"rendered":"Seed Funding For Startups &#8211; An Initiative By The Government"},"content":{"rendered":"\n<p class=\"has-drop-cap\">The\nStartup India initiative by the Indian Government predicts building a strong\nStartup environment in India for nurturing innovation and giving opportunities\nto budding entrepreneurs. Also, in the <strong><em>Union Budget of 2020<\/em><\/strong>, the Government\nof India set up an <strong><em>Investment Clearance Cell<\/em><\/strong> for early phase Startups. This Cell\nprovides end-to-end support and facilitation for clearance and investment on\nboth State &amp; Centre levels. Scroll down to know more about Seed Funding for\nStartups by the Government of India.<\/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\/seed-funding-for-startups-an-initiative-by-the-government\/#What_do_you_mean_by_Seed_Funding\" >What do you mean by Seed Funding?<\/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\/seed-funding-for-startups-an-initiative-by-the-government\/#Seed_Funding_for_Startups_from_the_Government_of_India\" >Seed Funding for Startups from the Government of\nIndia<\/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\/seed-funding-for-startups-an-initiative-by-the-government\/#What_is_Startup_India_Seed_Fund_Scheme_SISFS\" >What is Startup India Seed Fund Scheme (SISFS)?<\/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\/seed-funding-for-startups-an-initiative-by-the-government\/#How_can_you_Get_Seed_Funding_for_Startups_from_the_Government_of_India\" >How can you Get Seed Funding for Startups from the\nGovernment of India?<\/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\/seed-funding-for-startups-an-initiative-by-the-government\/#Repayment_of_Seed_Funding_for_Startups\" >Repayment of Seed Funding for Startups<\/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\/seed-funding-for-startups-an-initiative-by-the-government\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_do_you_mean_by_Seed_Funding\"><\/span><strong>What do you mean by Seed Funding?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Seed\nFunding for Startups is an initial stage investment that aids a potentially new\nbusiness start and set up its idea or process before the company starts\ngenerating or making revenues or until further investment is required.\nInvestment is financial fuel to any Startup and Seed Funding is the first drop\nof the fuel. Seed Funding for Startups is also known as Seed Money, Initial\nFunding, or Startup Fund.<\/p>\n\n\n\n<p><strong><em>There\nare different types of Seed Funding for Startups in India and you can check the\nsame below:<\/em><\/strong><\/p>\n\n\n\n<ol><li>Crowdfunding;<\/li><li>Corporate Seed Funding;<\/li><li>Bootstrapping (Personal funding);<\/li><li>Debt funding;<\/li><li>Incubators;<\/li><li>Accelerators;<\/li><li>Angel Investors;<\/li><li>Venture Capital Funding;<\/li><li>Angel funds or Angel Investors.<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Seed_Funding_for_Startups_from_the_Government_of_India\"><\/span><strong>Seed Funding for Startups from the Government of\nIndia<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The Central Government see the extraordinary talent\nof India\u2019 young entrepreneurs, their dedication and eagerness to grow larger\nand stronger. To that end, the Indian Government has taken steps to boost\nStartups, financial infrastructure, and Research &amp; Development.<\/p>\n\n\n\n<p><strong><em>The\nIndian Government has so far recognised the following sector for the Seed\nFunding and they are:<\/em><\/strong><\/p>\n\n\n\n<ul><li>Education;<\/li><li>Financial\nInclusion;<\/li><li>Smart\nCities;<\/li><li>Healthcare;<\/li><li>Agriculture;<\/li><li>Energy\nand Environment;<\/li><li>Smart\nTransportation.<\/li><\/ul>\n\n\n\n<p>Accordingly, it set up the <strong><em>Fund of Funds (FSS)<\/em><\/strong> for\nStartups under <strong><em>SIDBI (Small Industries Development Bank of India) <\/em><\/strong>to extend\nits support to Indian Startups. This Fund of Funds (FSS) was set up in 2016\nunder SIBDI, making downstream investment in <strong><em>Venture Capital (VC)<\/em><\/strong> <strong><em>Funds<\/em><\/strong>\nand <strong><em>Alternate\nInvestment Funds (AIFs) <\/em><\/strong>registered under SEBI, which further invest in\nStartups.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_Startup_India_Seed_Fund_Scheme_SISFS\"><\/span><strong>What is Startup India Seed Fund Scheme (SISFS)?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Funding from Venture Capitals and Angel Investors becomes available to Startups only after the proof of concept has been provided. Similarly, banks provide loans only to asset-backed applicants. It is vital to provide Seed Funding for Startups with an innovative idea to conduct proof of concept trials. DPIIT has created SISFS or <a href=\"https:\/\/corpbiz.io\/startup-india-registration\"><strong>Startup India<\/strong><\/a> Seed Fund Scheme with an outlay of Rs. 945 crore to give financial assistance to Startups for Proof of Concept, product trials, commercialisation, prototype development, and market entry. It will support an estimated 3,600 entrepreneurs via 300 incubators in the next four years.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Objectives of SISFS<\/strong><\/h3>\n\n\n\n<p>The Indian Startup environment suffers from capital\ninsufficiency in the seed and Proof of Concept development phase. The capital\nrequired at this phase often presents a make or break situation for Startups\nwith good business ideas or concepts. Many innovative business ideas\/concepts\nfail to take off due to the absence of this serious capital required at an\ninitial phase for proof of concept, market entry, product trials, and\ncommercialisation. Seed Fund provided to such promising case can have a\nmultiplier effect in the validation of business ideas or thoughts of many\nStartups, leading to employment generation.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_can_you_Get_Seed_Funding_for_Startups_from_the_Government_of_India\"><\/span><strong>How can you Get Seed Funding for Startups from the\nGovernment of India?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>To\nget Seed Funding for Startups from the Government of India, you need to follow\nthe step mentioned below:<\/em><\/strong><\/p>\n\n\n\n<ol><li>First, you have to register on the website of Start-up India and get certified as per the process listed;<\/li><li>Once your registered on the official website of Startup India, the Startup should satisfy the metrics to be considered or deemed to get the Seed Fund;<\/li><li>Startups don&#8217;t get Seed Funds directly from the Government of India; they will get seed from the Alternate Investment Funds (Venture Capitalist registered under SEBI). Therefore, startup companies have to approach Alternate Investment Funds for presenting their innovation or ideas. These Alternate Investment Funds are Venture Capitalist registered under <strong>SEBI<\/strong><sup><a href=\"https:\/\/www.sebi.gov.in\/\"><strong>[1]<\/strong><\/a><\/sup>;<\/li><li>Once the idea is approved, the Alternate Investment Fund will examine and recommend to SIDBI to disburse the said Seed Fund to such startups.<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Repayment_of_Seed_Funding_for_Startups\"><\/span><strong>Repayment of Seed Funding for Startups<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Small Industries Development Bank of India or SIDBI while disbursing the Seed Funding, will provide for terms &amp; conditions and tenure for the repayment of the Seed Funding for Startups. Following is the table where you can peruse an overview of the Seed Funding trends over the past few years:<\/p>\n\n\n\n<table class=\"table table-bordered\"><tbody><tr><td>\n  <strong>Financial Year<\/strong>\n  <\/td><td>\n  <strong>Government Seed Fund Corpus (Rs.)<\/strong>\n  <\/td><td>\n  <strong>Number of Startups got the Benefit<\/strong>\n  <\/td><\/tr><tr><td>\n  2015-16\n  <\/td><td>\n  500\n  Crore\n  <\/td><td>\n  &nbsp;\n  A\n  total of 243 Startups received Seed Funding from Government of India.\n  <\/td><\/tr><tr><td>\n  2016-17\n  <\/td><td>\n  100&nbsp; Crore\n  <\/td><\/tr><tr><td>\n  2017-18\n  <\/td><td>\n  1150\n  Crore\n  <\/td><\/tr><tr><td>\n  2018-19\n  <\/td><td>\n  1115\n  Crore\n  <\/td><\/tr><tr><td>\n  2019-20\n  <\/td><td>\n  431\n  Crore\n  <\/td><\/tr><tr><td>\n  2020-21\n  <\/td><td>\n  1054\n  Crore\n  <\/td><td>\n  &nbsp;\n  <\/td><\/tr><\/tbody><\/table>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span><strong>Conclusion<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>\n\nApart from the above-mentioned manners, the Government of India also\nhelps Startups in obtaining Seed Funding through a Price Incentive scheme and\nmoney challenges. The Indian Government organises these contests or workshops\nin collaboration with various sponsors from around the globe.\n\n\n\n<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Startup India initiative by the Indian Government predicts building a strong Startup environment in India for nurturing innovation and giving opportunities to budding entrepreneurs. Also, in the Union Budget of 2020, the Government of India set up an Investment Clearance Cell for early phase Startups. This Cell provides end-to-end support and facilitation for clearance [&hellip;]<\/p>\n","protected":false},"author":35,"featured_media":39632,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[153],"tags":[2091],"acf":{"service_id":"220"},"authorName":"Karan Singh","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2022\/01\/processed-1-150x150.jpeg","authorDescription":"A legal writing enthusiast, a wanderer, and a zealous reader. After gaining a lot of knowledge about the diverse legal topics and developing research skills, Karan joined the league of legal content writers to deliver quality-rich blogs.","postViews":4135,"readingTime":3,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/39630"}],"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\/35"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=39630"}],"version-history":[{"count":8,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/39630\/revisions"}],"predecessor-version":[{"id":39639,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/39630\/revisions\/39639"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/39632"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=39630"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=39630"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=39630"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}