SIDBI partners with Bihar Startup Fund Trust partners to enhancing startup ecosystem in Bihar

In a bid to bolster the startup ecosystem in Bihar, the Bihar Startup Fund Trust, under the Department of Industries, Government of Bihar, has signed a pact with the Small Industries Development Bank of India (SIDBI).

The partnership aims to administer the Rs 50 Crore Bihar Startup Scale-up Financing Fund (BSSFF), marking a pivotal step towards transforming Bihar into a vibrant startup hub.

Creating a nurturing environment for startups

The partnership aims to create a nurturing environment for startups in Bihar, focusing on innovation to address complex challenges facing the Indian economy and society.

The Bihar Start-Up Fund Trust (BSFT), a nodal agency established by the Department of Industries, Government of Bihar, is at the forefront of implementing the Bihar Start-Up Policy.

The policy is designed to foster entrepreneurship and innovation by creating an ecosystem that is conducive to the growth of startups in the state.

Under the Policy, the state government has set up Bihar Start-Up Fund Trust with an initial Corpus of Rs 500 crore. Out of this fund, the Bihar Startup Scale-up Financing Fund (BSSFF) has been established with an initial corpus of Rs 50 crore for scale-up funding support to startups.

Fund of Funds Model

The BSSFF, managed by SIDBI, adopts a fund-of-funds model, which means it will not invest directly in startup companies. Instead, it will contribute to the corpus of SEBI-registered Alternative Investment Funds (AIFs), which in turn shall invest in startups.

The approach is aimed at scaling up funding support to startups, facilitating their growth and development, as per the statement. 

What does SIDBI do?

Established in 1990, SIDBI has played a crucial role in shaping the startup ecosystem in India, especially at a time when the risk capital and venture capital ecosystem was almost non-existent.

Over the past three decades, The firm has introduced several pioneering initiatives to support startups, including setting up various schemes and partnering with the Government of India and state governments to manage their startup vision through Fund of Funds interventions. 

It is now managing funds focused on Agro and Rural enterprises and state-focused funds for Uttar Pradesh, Odisha, and now Bihar.

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