The STPI (Software Technology Parks of India) has said the first tranche of investments into start-ups from the ₹120-crore Next Generation Incubation Scheme (NGIS) venture capital fund will be made in the next few weeks.
The STPI has tied up funds for the NGIS fund, which is aimed at supporting start-ups set up in tier II and tier III towns. The fund aims to foster start-ups in smaller towns that don’t find financial resources to support their ventures.
“We have selected 42 start-ups from about 1,820 applications that we received in Chunauti 1.0 after a multi-tier selection process,” Omkar Rai, Director-General of STPI, told BusinessLine. “We have onboarded 38 start-ups working in domains such as fintech, agritech,medtech and edutech. We are hoping to release the first tranche of funds from the ₹120-crore venture capital fund in the next few weeks,” he said.
Focus areas
Pontaq Venture India LLP has been appointed as the manager of the fund. The STPI has committed ₹60 crore towards its contribution to the fund. The STPI, which played a major role in promoting IT exports from the country, unveiled a plan last year to foster the start-up ecosystem in different parts of the country. It has also opened Centres of Excellence (CoE) in emerging technologies like artificial intelligence, machine learning, big data analytics, blockchain, augmented/virtual reality and IoT. The STPI said its 2.0 version would focus more on non-metros and places like the North-East, where abundant IT talent is available. The NGIS venture capital fund, however, is likely to limit its exposure to not more than ₹25 lakh.
The STPI is planning to hold nationwide ‘challenges’ to select start-ups for offering financial support and mentorship. The seed funding of up to ₹25 lakh would be provided to the shortlisted start-ups. The disbursals would be based on milestones achieved and periodic reviews. The seed funding will be in the form of equity participation by the STPI.
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