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All you need to know about the maiden Karnataka Startup Policy

Startups have become the recent phenomena and the Narendra Modi government is trying very hard to create a cohesive atmosphere for startups through various policies including Start-Up India. The states are also going extra miles to attract startups by waging subsidies and loans. However, Karnataka became the first state to release its maiden Startup Policy (2015-2020). The policy however will be formally unveiled at the Invest Karnataka event starting from 3rd February, 2016.

Bangalore is home to almost 3,100 to 4,900 active tech startups, according to Global Startup Ecosystem Ranking Report of 2015 and it is the only city in the country to come in the top 20 startup destinations across the world.


  • The vision of this policy is to create a world-class startup eco-system in the state through strategic investment and policy interventions to establish a healthy innovation climate in Bangalore.
  • Stimulate the growth of 20,000 tech startups.
  • To create 6000 product startups by the year 2020 in Karnataka
  • Generate 6 lakh direct and 12 lakh indirect new employments.
  • Mobilize Rs. 2,000 Cr Fund of Funds by state government.
  • Facilitate establishment of at least 25 Innovative Technology solutions with social impact in sectors like- Health care, Food Security, Clean Environment and Education for all etc.


New Age Incubation Network (NAIN)-To encourage entrepreneurship through education, the new age incubation scheme will be implemented in 50 academic institutes in tier-II cities during the policy period. These selected academic institutions will have incubation centres to mentor student projects. Financial assistance will be provided to the selected institutes for 3 years to create incubators. Each NAIN institution will have-

  • Grants to support operational expenses like Salaries of Regional Coordinators, mentoring programmes, networking meetings, conducting Hackathons etc.
  • A maximum Rs. 3 lakhs annual financial assistance for each project.
  • Training and capacity building for faculty and students.
  • Internship stipends.
  • These institutions will be the hub of entrepreneurship in each district in the state.

Encouraging strong partnership between R&D institutions-

  • The state will lend its support on creating Technology Business Incubators (TBIs) in higher learning institutions for duration of 3 years and can be extended for another 2 years.
  • TBIs will be promoted in thrust areas like ICT/IOT (Internet of Things), Software Products, manufacturing including Electronic Systems Design, Robotics and 3D Printing, manufacturing 4.0. Healthcare and Bio-Pharma, Agriculture related fields, Clean Tech Energy Water and its recycling, Education, Nanotechnology and Composites.

Proving Early Stage Funding-

  • The government will set up an Ignition Fund to support early-stage startups through Grant-in-aid funding.
  • The financial assistance will be provided through TBIs or other selected incubators 0nly.

Creating Incubators through PPP Model-

  • The state will invite national ad global well-known incubators and accelerators to set up centres in Public-Private-Partnerships model.
  • These incubators in Tier-II cities and Bangalore will mentor in NAIN institutes.
  • Efforts will be made to maintain all government and private Common Instrumentation Facilities (CIF) that are available for public use.

Startup funding through Fund of Funds-

  • A Fund of Funds will be allocated to invest in Venture funds to facilitate startups.
  • A portion of this fund can be used for Angel stage funding.
  • A professional fund manager will be employed through open bidding process.

Channelizing Innovation through Social Impact-

  • The state under its Social innovation challenge competition will identify 5 ideas each year and provide solutions through rigorous process.
  • These selected ideas would be awarded with an initial grant and a follow-up funding.
  • The winners will automatically qualify for incubation space in the incubators.

Providing incentives and concessions-

  • The startups that qualify the eligibility criteria in the state will be entitled for incentives and concessions in the i4, ESDM, AVGC, BT, Industrial policy etc.
  • Startups signed up in recognized incubation centres and accelerators will be granted to file self-certifications in all the seven laws of the state government.

Startup Cell and Hotline-

  • To help and mentor entrepreneurs, a Startup Cell will be set up in KBITS to act as a one-stop solution for startups.
  • The cell will also manage a common startup portal and hotline to provide information regarding policies, incubators, service providers (CA, Lawyer, real estate, IP Protection etc.), regulatory information, events/workshops, investors/VC funds etc.

About Sahitya


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