In a significant move to boost the startup ecosystem in Tamil Nadu, Chief Minister MK Stalin introduced the ambitious ‘Tamil Nadu Startup and Innovation Policy 2023’ on Wednesday. This policy outlines more than 50 key actions to boost the state into a leading hub for startups and innovation.
Within the framework of this policy, the state administration aims to set up a significant fund, named the Tamil Nadu Co-Creation Fund, with a substantial capital of Rs 100 crore. This fund’s primary purpose is to channel investments into regional and thematic projects and will be overseen by a consortium of investors, all working in tandem under the guidance of StartupTN. The inspiration for this fund is derived from the Yozma model, which Israel pioneered in the 1990s to ignite innovative industries by injecting capital into emerging venture capital funds.
Significantly, the policy extends the scope of what qualifies as a startup. It now encompasses enterprises spearheaded by individuals hailing from socially disadvantaged communities who employ inventive approaches in diverse sectors to improve the socio-economic circumstances of their communities. This expansion aligns harmoniously with the pre-existing startup criteria delineated in the policy.
According to the policy, the state government will provide 40% (up to Rs 10 crore) for regional, rural, women-led and climate-focused funds, with 20% (up to Rs 5 crore) for other thematic funds by the private sector. New funds need to be at least of Rs 20 crore in size and the government should cover 75% and 50% of setup costs for the specified categories respectively.
In a further show of commitment to promoting startups among marginalized communities, the Chief Minister issued sanction orders for investments totaling Rs 10.85 crore in eight startups led by SCs and STs.