SIDBI Fund of Funds for Startups (FFS)

SIDBI Fund of Funds for Startups (FFS)

Funds India's startup ecosystem indirectly by committing government-backed capital to qualified fund managers in a mother fund structure.

SIDBI's Fund of Funds for Startups (FFS) is a government-backed mother-fund established by the Small Industries Development Bank of India under the Government of India's Startup India initiative. SIDBI, incorporated by an Act of Parliament in 1990 and regulated by the Reserve Bank of India as one of five All India Financial Institutions, deploys the FFS corpus as LP capital commitments into SEBI-registered Alternative Investment Funds (AIFs) that in turn invest directly in Indian startups. The mother-fund corpus stands at INR 10,000 crore; daughter-fund commitments to individual AIFs range from approximately INR 10 crore to INR 250 crore per fund.

The FFS does not invest directly in startups. Eligible AIFs must be registered with SEBI under Category I or Category II, must invest in Indian-domiciled startups, and must demonstrate alignment with priority sectors under Startup India. SIDBI acts as a patient institutional LP, taking a minority position in each daughter fund and not exceeding a specified concentration limit per fund manager. The programme is sector-agnostic at the mother-fund level, meaning daughter funds may target any sector compliant with SEBI regulations and SIDBI's internal investment policy.

For a startup seeking direct capital, FFS access is indirect — the relevant application is to an SEBI-registered AIF that has received or is seeking FFS capital, not to SIDBI itself. The programme's primary value lies in catalysing India's private venture capital ecosystem by providing anchor institutional capital to emerging fund managers who might otherwise struggle to reach first-close. Startups benefit downstream as the pool of professionally managed, SIDBI-backed VC capital expands. SIDBI administers FFS applications and fund-selection through its corporate investment team in Lucknow.