Startup India Seed Fund Scheme (SISFS) aims to provide financial assistance to startups for proof of concept, prototype development, product trials, market entry and commercialization. This would enable these startups to graduate to a level where they will be able to raise investments from angel investors or venture capitalists or seek loans from commercial banks or financial institutions. The Seed Fund will be disbursed to eligible startups through eligible incubators across India.
How will the scheme operate?
Preferential sectors: social impact, waste management, water management, financial inclusion, education, agriculture, food processing, biotechnology, healthcare, energy, mobility, defense, space, railways, oil and gas, textiles, etc.
Incentive to Incubator:
Experts Advisory Committee (EAC) shall evaluate incubators for grant assistance. A Grant of up to Rs. 5 (five) crores would be provided to a selected incubator in milestone-based three (or) more instalments. The exact quantum of grant and instalments for each incubator will be decided by the Experts Advisory Committee (EAC) based on its evaluation.
A component of Management Fee @ 5% of Seed Fund grant to the incubator will be provisioned. The Management Fee provisioned for incubators shall not be used by the incubator for facility creation or any other administrative expenses. The Management Fee will be utilized for administrative expenditure, selection and due diligence of startups, and monitoring of progress of beneficiary startups.
Incentive to Startups:
Seed Fund to an eligible startup by the incubator shall be disbursed as follows (Startup will not receive seed support more than once each as mentioned below):