The Department for Promotion of Industry and Internal Trade (DPIIT) recognized 56,000 companies, or over 45% of all startups, are originating from Tier 2 and Tier 3 cities, according to the Economic Survey for the financial year 2023–24, which was presented in Parliament on July 22.

According to the pre-budget paper, there would be over 1.25 lakh companies recognized by DPIIT by the end of March 2024, up from over 300 businesses in 2016.

"Start-ups filed more than 12,000 patent applications from 2016 to March 2024," it stated. More than 47% of recognized startups, according to the poll, have at least one female director.

By the end of FY24, around 135 Alternative Investment Funds under the Fund of Funds for Startups (FFS) had committed over Rs 10,500 crore, investing over ₹18,000 crore in start-ups, according to the Economic Survey.

In order to provide the startup ecosystem a much-needed boost and facilitate access to domestic finance, the Finance Commission authorized and launched the FFS plan in 2016 with a corpus of Rs 10,000 crore. Contributions were dispersed between the 14th and 15th Finance Commission cycles based on the status of implementation.

Instead of making direct investments in startups under the FFS plan, money is given to daughter funds—SEBI-registered AIFs—which then use that money to make equity and equity-linked investments in expanding Indian firms.

The mission for managing this fund has been assigned to Small Industries Development Bank of India (SIDBI), which will identify appropriate daughter funds and supervise the distribution of committed resources. Investments in startups by AIFs financed by FFS must be at least twice as large as the total amount invested under FFS.