Cabinet Approves Startup India Fund of Funds 2.0

16 Feb 2026

On 13th February 2026, the Union Cabinet approved the Startup India Fund of Funds 2.0 (FoF 2.0) with a corpus of ₹10,000 crore to boost venture capital investment and strengthen India’s innovation-driven startup ecosystem.

Key Points:

New ₹10,000 Crore Funding Corpus: The Startup India Fund of Funds 2.0 has been approved to mobilise long-term domestic capital and provide stronger financial support to India’s rapidly expanding startup ecosystem.
Building on Earlier Success: The new fund follows the success of the first Fund of Funds launched in 2016, which supported 145 Alternative Investment Funds and enabled investments of over ₹25,500 crore in more than 1,370 startups.
Focus on Deep Tech and Innovation: The second phase will prioritise sectors such as deep technology, innovative manufacturing and emerging technologies that require patient and long-term capital support.
Support For Early-Growth Startups: The scheme aims to assist startups at early growth stages to reduce failure rates caused by limited access to capital during their initial years.
Expansion Beyond Metro Cities: The initiative seeks to ensure balanced regional development by expanding investment support to startups operating outside major metropolitan centres.
Strengthening Venture Capital Ecosystem: The fund will help address high-risk capital gaps in priority sectors and support smaller venture capital funds, thereby deepening the domestic investment ecosystem.
Rapid Growth of Startup Landscape: Since the launch of Startup India in 2016, the number of DPIIT-recognised startups has grown from fewer than 500 to over 2 lakh, with 2025 witnessing the highest-ever annual registrations.
Boost to Economic Growth and Jobs: The scheme is expected to contribute to innovation-led growth, stronger manufacturing capabilities, job creation and the development of globally competitive technologies.