Key takeaways
- Match the funding source to your stage: grants and angels early, VCs once you have traction.
- DPIIT recognition unlocks the Startup India Seed Fund Scheme and the Credit Guarantee Scheme for Startups.
- Angel tax was abolished for all classes of investors from FY 2025-26.
Start with the right source for your stage
| Stage | Typical sources | What investors look for |
|---|---|---|
| Idea | Savings, friends and family, grants | A real problem and a capable team |
| MVP / pre-seed | Angels, accelerators, Startup India Seed Fund | Early users or pilots |
| Seed | Angel networks, seed VCs, micro VCs | Product-market fit signals and growth |
| Series A | Venture capital funds | Repeatable revenue growth and strong unit economics |
Read more in funding stages explained.
Government schemes
- Startup India Seed Fund Scheme (SISFS): up to ₹20 lakh as a grant for proof of concept or prototypes, and up to ₹50 lakh as debt or convertible debentures for market entry, disbursed through selected incubators. You need DPIIT recognition and must be no more than two years old when you apply. See SISFS.
- Credit Guarantee Scheme for Startups (CGSS): lets DPIIT-recognised startups borrow from banks and NBFCs with a government guarantee; the cover per borrower was raised to ₹20 crore in 2025.
- Fund of Funds for Startups (FFS): managed by SIDBI, it invests in SEBI-registered VC funds, which then invest in startups.
- Sector and state schemes: BIRAC for biotech, MeitY SAMRIDH and TIDE 2.0 for software and tech, and state policies such as Uttar Pradesh and Karnataka ELEVATE.
First step: get DPIIT recognition.
Angels and angel networks
Angel investors write the first outside cheques, often ₹10 lakh to ₹1 crore per investor. Networks and platforms such as Indian Angel Network, Mumbai Angels and LetsVenture pool angels into larger rounds. Most pre-seed rounds use a SAFE, a CCD or a priced equity round; see SAFE vs convertible note vs priced round.
Good news for founders: the Union Budget 2024 abolished the so-called angel tax (Section 56(2)(viib)) for all classes of investors, from FY 2025-26.
Venture capital
VCs invest from institutional funds and expect fast growth and a path to a large outcome. Before you pitch, prepare a clear pitch deck, a financial model, your key metrics and a data room. Expect to negotiate a term sheet. See who is raising now in our funding tracker.
Non-dilutive and alternative funding
- Venture debt: for VC-backed startups that want runway without more dilution.
- Revenue-based financing: repay from future revenue; suits D2C and SaaS businesses with steady sales.
- Cloud and AI credits: cut infrastructure costs; see how to get cloud and AI credits.
- Accelerators and competitions: many offer equity-free grants or prizes. Browse programmes in India.
Get help from Kreeaa
Kreeaa invests from MVP to Series A and helps founders get investor-ready. Applications are open for Kreeaa Launchpad 2027, a free 12-week programme with no equity to join, or you can pitch your startup directly.
This guide is general information, not legal, tax or financial advice. Rules and programme terms change, so check official sources and speak to a qualified adviser before making decisions.