STARTUP INDIA SEED FUND SCHEME
Startup India Seed Fund Scheme (SISFS) is one such scheme provides financial assistance to early-stage startups for proof of concept, prototype development, product trials, market-entry, and commercialization. Eligible startups can apply for the scheme on the Startup India portal. The Seed Fund will be disbursed to selected startups through eligible incubators across India.
DPIIT has created Startup India Seed Fund Scheme (SISFS) with an outlay of INR 945 Crore to provide financial assistance to startups for Proof of Concept, prototype development, product trials, market entry, and commercialization.It will support an estimated 3,600 entrepreneurs through 300 incubators in the next 4 years.
The Hon’ble Prime Minister of India announced the scheme in his Grand Plenary address of Prarambh: Startup India International Summit on 16th January 2021. After approval of EFC and Hon’ble Finance Minister, the scheme has been notified on 21.01.2021.
The Seed Fund will be disbursed to eligible startups through eligible incubators across India.
Objectives of Startup India Seed Fund Scheme (SISFS)
- The Indian startup ecosystem suffers from capital inadequacy in the seed and ‘Proof of Concept’ development stage.
The capital required at this stage often presents a make or break situation for startups with good business ideas.
- Many innovative business ideas fail to take off due to the absence of this critical capital required at an early stage for proof of concept, prototype development, product trials, market entry and commercialization.
- Seed Fund offered to such promising cases can have a multiplier effect in validation of business ideas of many startups, leading to employment generation.
ALSO READ: NIDHI-PRAYAS GRANT UP TO 10 LAKH
Eligibility Criteria for Startup India seed Fund Scheme or Seed Funding:
- A startup, recognized by DPIIT, incorporated not more than 2 years ago at the time of application.
To get DPIIT-recognized, please visit https://www.startupindia.gov.in/content/sih/en/startupgov/startup-recognition-page.html
- The startup must have a business idea to develop a product or a service with a market fit, viable commercialization, and scope of scaling.
- The startup should be using technology in its core product or service, or business model, or distribution model, or methodology to solve the problem being targeted.
- Preference would be given to startups creating innovative solutions in sectors such as social impact, waste management, water management, financial inclusion, education, agriculture, food processing, biotechnology, healthcare, energy, mobility, defence, space, railways, oil and gas, textiles, etc.
- Startup should not have received more than Rs 10 lakh of monetary support under any other Central or State Government scheme. This does not include prize money from competitions and grand challenges, subsidized working space, founder monthly allowance, access to labs, or access to prototyping facility.
- Shareholding by Indian promoters in the startup should be at least 51% at the time of application to the incubator for the scheme, as per Companies Act, 2013 and SEBI (ICDR) Regulations, 2018.
- A startup applicant can avail seed support in the form of grant and debt/convertible debentures each once as per the guidelines of the scheme.
How much seed funding can a startup receive under the Startup India seed Fund scheme?
The Central Government has approved the ‘Startup India Seed Fund Scheme (SISFS)’ to provide financial assistance to startups for proof of concept, prototype development, product trials, market entry and commercialization. SISFS shall provide financial assistance to startups via corpus of Rs. 945 Crore that will be disbursed through selected incubators across India in 2021-25.
Seed Fund to an eligible startup by the incubator shall be disbursed as follows:
- Up to Rs. 20 Lakhs as grant for validation of Proof of Concept, or prototype development, or product trials. The grant shall be disbursed in milestone-based installments. These milestones can be related to development of prototype, product testing, building a product ready for market launch, etc.
- Up to Rs. 50 Lakhs of investment for market entry, commercialization, or scaling up through convertible debentures or debt or debt-linked instruments
- A startup applicant can avail seed support in the form of grant and debt/convertible debentures each once as per the guidelines of the scheme
Startup India Seed Fund Scheme Support in Which Sector?
SISFS is a sector agnostic scheme, which means that startups from any sector can apply for the scheme. However, preference would be given to startups creating innovative solutions in sectors such as:-
- social impact
- waste management
- water management
- financial inclusion
- food processing
- oil and gas
- textiles, etc.
This list of sectors is indicative and not exhaustive.
Documents Required for Startup India Seed Fund Scheme
- PITCH DECK OF STARTUP
- AUTHORIZATION LETTER /Board Resolution Copy/POA
- Details of Expense Bucket
- Detail of background of CEO (Chief Executive Officer)
- Video regarding your prototype products (If available)
- Startup India recognition.
How to apply For Startup India Seed Fund Scheme online?
- Visit this website https://seedfund.startupindia.gov.in/home
2. If you are the startup, then click on the Apply Now button of Startup and use Credentials of Startup India Registration for Login.
After Login Application open for filling as below details:
- Authorize Representative.
- Entity Details
- Startup Details’
- Startup Team
- Funding Details
- Incubator Preference
- Upload Documents
The application submission is completely online, and no physical submission of documents is required.
For more details watch below video-
After Submission of final application- Evaluation Process start
Startup India Seed Fund Scheme Application Evaluation
Application of each startup will be reviewed by an Incubator Seed Management Committee (ISMC) formed by the incubators you apply to. The committee will also be responsible for future assessment of the performance of the startup and disbursement of further tranches. Each ISMC constitutes of the following members:
- Nominee of Incubator (Chairman)
- A representative from the State Government’s Startup Nodal Team
- A representative of a Venture Capital Fund or Angel Network
- A domain expert from Industry
- A domain expert from academia
- Two successful Entrepreneurs
- Any other relevant Stakeholder
The startups shall be selected through an open, transparent and fair process, comprising, inter-alia:
- Startups submit their application on the Startup India portal and an email confirmation is shared with them. Applicants can apply for seed fund to any three incubators selected as disbursing partners for this scheme in order of their preference.
- All applications received will be shared online with respective incubators for further evaluation.
- For all incomplete applications, a prompt of resubmission will be sent to the startup.
- The incubators shall shortlist applicants as per eligibility criteria
- Eligible applications will be evaluated by Incubator Seed Management Committee (ISMC) using the following criteria:
Criteria Details Weightage (%) 1 Is there a need for this Idea? Market size, what market gap is it filling, does it solve a real-world problem? p 2 Feasibility Feasibility and reasonability of the technical claims, methodology used/ to be used for PoC and validation, roadmap for product development q 3 Potential Impact Customer demographic & the technology’s effect on these, national importance (if any) r 4 Novelty USP of the technology, associated IP s 5 Team Strength of the team, Technical and business expertise t 6 Fund Utilization Plan Roadmap of money utilization u 7 Additional Parameters Any additional parameters considered appropriate by incubator v 8 Presentation USP of the technology, associated IP Overall assessment 100% Weightages for criteria (p, q, r, s, t, u, v, w) may be assigned by each incubator differently
- Incubator may shortlist applicants based on their evaluation for a presentation before ISMC
- ISMC shall evaluate applicants based on their submissions and presentations and select startups for Seed Fund within 45 days of receipt of application
- Selected startups shall receive seed funding under the respective incubator that selects them as beneficiaries as per their preference shared during application (for example, if incubators at Preference 1 and Preference 2 both select a startup, the funding shall be given by Preference 1 incubator. If Preference 1 incubator rejects and Preference 2 incubator selects, the funding shall be given by incubator at Preference 2, and so on.)
- All applicants will be able to track the progress of their application on the Startup India portal on a real-time basis
- Applicants who are rejected will also be notified through email.
What are the parameters for evaluation of startup applicants?
How much time will it take for my application to get processed?
After the receipt of the application, each Incubator shall evaluate applicants based on their submissions and presentations and select startups for Seed Fund within 45 days.
NOTE: If you want to apply for Startup India Seed Fund Scheme then contact us-
Contact No. +91-8298057771
Fill Below Form-