Patna: The Bihar Startup Fund Trust (BSFT), an autonomous body of the state government, has entered into an agreement with the Small Industries Development Bank of India (SIDBI) to boost the startup ecosystem in the state.
Officials of the state’s industries department said that the memorandum of understanding (MoU) was signed on Saturday with a view to creating a conducive environment for growth of startups and transform Bihar as a startup hub of eastern India.
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The BSFT and SIDBI will together administer the ₹50-crore Bihar Startup Scale-up Financing Fund’ (BSSFF). The BSFT is the nodal agency constituted under chairmanship of the development commissioner by the industries department for smooth execution of the Bihar Startup Policy.
The BSFT has been set up with an initial corpus of ₹500 crore, out of which an initial corpus fund of ₹50 crore has been allocated for BSSFF to scale up funding support to the startups.
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The agreement was signed between industries director Pankaj Dixit and general manager, SIDBI, Arjit Dutt, in presence of deputy chief minister Samrat Chaudhary and additional chief secretary (industries) Sandeep Pundrik, to create a conducive ecosystem for startups to flourish economically while focussing on innovation to solve complex problems of the economy and society.
The state government had launched the startup policy in August 2022 to foster entrepreneurship and promote innovation by creating an ecosystem that is conducive for the growth of start-ups. As per the MoU, BSSFF will be managed by SIDBI in the form of a fund of funds. In this model, the fund shall not invest directly into start- up companies, instead it shall contribute to the corpus of SEBI registered alternative investment funds, which in turn shall invest in startups.
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Since, its formation in 1990, when the risk capital and venture capital ecosystem for innovative enterprises and startups was nearly non-existent in the country, SIDBI has been impacting the lives of citizens across various strata of the society through its integrated, innovative, and inclusive approach.
SIDBI has taken several pioneering steps to support building up of startup ecosystem including support out of its own balance sheet in the past three decades. SIDBI supported setting up of several schemes on its own before emerging as a key partner of the Government of India and several state governments for managing their vision in startup space through fund of funds interventions. Apart from fund of funds, SIDBI also manages ASPIRE fund of funds of the ministry of MSME with focus on agro and rural enterprises, and state focussed fund of funds for Uttar Pradesh & Odisha and now Bihar.
