Fund of Funds for Startups (FFS)

The Fund of Funds for Startups (FFS) is a government initiative that takes a two-tier approach to channelling public money into the startup ecosystem. Instead of investing directly in startups, the government contributes to a corpus managed by SIDBI, which then makes commitments as a limited partner (LP) into SEBI-registered Alternative Investment Funds (AIFs). Those AIFs — privately managed venture capital or private equity funds — deploy the capital into portfolio startups based on their own investment mandates.

This structure is deliberate. The government avoids the operational complexity of picking individual startups, while professional fund managers apply market discipline and due diligence. The FFS effectively multiplies the government's impact by catalysing private capital alongside the public contribution: a fund that receives FFS backing will typically also raise from domestic institutions, family offices, and other LPs, so each rupee of public money levers in additional private investment.

For a startup founder, FFS is indirect: you do not apply to FFS. Instead, you pitch to AIFs that have received FFS backing. Knowing which funds are FFS-supported can be useful because those funds tend to have a mandate to invest in DPIIT-recognised startups and often maintain a domestic-focused or sector-specific thesis that aligns with government priorities.

FFS is administered with SEBI oversight on the fund side and DPIIT policy oversight at the government level. It represents one of the largest committed pools of domestic institutional capital for the Indian venture ecosystem and has contributed to the growth of several sector-focused funds — including those targeting deep tech, agri, and social impact.