Startups in India are recently introduced to startup seed fund. The fund will provide up to Rs 20 lakh as a reward for validation of proof of concept to the startups. This allowance will be spent in milestone-based installments. Since the global pandemic of COVID-19, the number of startups in India has grown. The very essential requirement of startups is providing employment and the economy needs stability.
Indeed startups really helped in providing employment. The new scheme of seed funds will help all the startups to grow.
As stated by the Prime Minister last month, Rs 1,000-crore fund will offer startups grants and equity capital. The government also will help startups in raising debt capital. The Department for Promotion of Industry and Internal Trade (DPIIT) voted to fund startups through incubators from April 1 under the Startup India Seed Fund Scheme.
Furthermore, it is in the process of arranging up a panel of discussion to shortlist these incubators.
Regulation and Startup
The government said in a notification that the membership committee will have at least three industry representatives. Including investors and entrepreneurs besides government officials.
Every DPIIT-recognised startup in India which is not more than two years old can apply for funding.
A business idea is expected to develop a product or a service with the market fit and scope of scaling. While the fund will remain sector-agnostic, it would give preference to startups in various sectors.
These include social impact, waste management, water management, financial inclusion, education, agriculture, food processing, biotechnology, healthcare, energy, mobility, defense, space, railways, oil and gas, textiles, among others.
Incubators and funding in startup India
This committee will have an angel network venture capital fund or a domain specialist from the business. And a domain specialist from academia among others.
Based on the number and performance of startup incubators to be picked and trial means with them.
The fund will provide up to Rs 20 lakh as a grant for validation of proof of concept to the startups. On the other hand, Rs 50 lakh of investment will be for scaling up the e-business or for market entry.
The Indian startup ecosystem bears from capital insufficiency in the seed and proof-of-concept expansion stage. For more information about incubators visit Incubators Program.
Many startups sink because of the absence of risk-taking appetite in the Indian investment ecosystem. This is the reason why unlike the US or China, India hasn’t seen enough product innovations. Instead remained to be a service provider. “We have just been assemblers. We assemble cars, mobile phones, electronics but lack real technology.
When it comes to drones, AI, cybersecurity we have no credibility at all. This has been a wake-up call. If we had a science and technology-based economy then we never have to worry doomed as a country.
It has become obvious that if we do not share technology risk, won’t make the technology innovations at all,said Sharad Sharma, co-founder of iSPIRT Foundation.
So far, the government has recognized 41,061 startups in India.
Author – Nishita Ghosh
Featured image credit– Yourstory