Kerala opens up govt market for startup consortiums, mulls state VC fund

Kerala opens up govt market for startup consortiums, mulls state VC fund
Photo Credit: VCCircle
19 Jan, 2021

Kerala is looking to set up a venture capital fund for startups in the state, even as it opens the government market for startup consortiums and hikes up the special development fund for such firms.

The announcements were made by Kerala chief minister Pinarayi Vijayan during an interaction with startup founders at a Kerala Startup Mission (KSUM)-organised event on Monday.

Additionally, a proposal to seek the backing of the Kerala Bank and the Kerala State Industrial Development Corporation (KSIDC) for the venture capital fund is under active consideration.

“It’s the policy of the government to offer necessary financial aid to startups to blossom. The government will consider increasing the special fund for the development of startups. Besides, the state will take further measures to enable entrepreneurs to improve their skills,” Vijayan said.

The government will set up an international launchpad for startups and earmark more funds to strengthen their marketing capabilities, he said. Women entrepreneurs will get up to Rs 15 lakh as loan, while startups led by women will have a moratorium of two years to repay their KSUM loans.

Founded in 2006, KSUM is the central agency of the Kerala government that focuses on entrepreneurship development and incubation activities in the state. KSUM also conducts programmes such as the annual Seeding Kerala event and monthly Investor Café to facilitate NRI investments in the startups.

Vijayan said startups have already been given complete exemption in their rent for four months and there will be a partial exemption in the rent amount for the next three months.

“Under KSUM’s Fund of Fund scheme, 11 startups have been given aid through Kerala Specific Angel Fund, which is the first of its kind in the country,” he said.