Government Sets Up Rs 623.5 Crore Fund For VCs

17 local Venture Capital funds were sanctioned by the Government’s Fund-of-Funds (FOF), an investment strategy, amounting to INR 623.50 crore last year. The investment was planned to support Venture Capitals who could invest in start-up.

VCs invest in 62 stratups

According to a data revealed by #DIPP (Department of Industrial Policy and Promotion) and #Sidbi ( Small Industries Development Bank of India), the analysis of Funds of Funds for initial year uncovers that the VCs that figured out how to get a share of the fund put resources into almost 62 new companies amid the year.

About FOF

Funds-of-Funds was launched in January of 2016 and acquires a slow but fair and complicated procedure for funding by VCs that prompted limited gainers.

62 startups gain Rs 186.84 crore

However, these 62 startups including Sidbi, a limited partner to the VCs, somehow managed to gain a sum of Rs 186.84 crore in Fiscal Year 2017. #Stellaris Venture Partners, #Pi Ventures, #Ideaspring Capital, #Orios Venture Partners, #Kae Capital, #Unicorn India Ventures, and some others include the funds that invested in these 62 startups.

Rs 33.63 crore has been withdrawn from Rs 623.50 crore

If a speculation opportunity arises, then up to 30% of VC’s corpus can be collected from FOF which can be withdrawn from Sidbi. That’s why only Rs 33.63 crore has been withdrawn by 17 VCs out of Rs 623.50 crore by the end of the March.

Funds are distributed in tranches

The government has released only Rs 600 crore, in two tranches over March, 2016 of Rs 500 crore and March, 2017 of Rs 100 crore, to Sidbi yet, out of Rs 10000 crore. Rest of the funds will be distributed in tranches till 2025.

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