New Enroll in RBI Grade B New Batch - Starts on May 21

    Question

    How does the Fund of Funds for Startups (FFS) Scheme

    provide funding to startups?  
    A By giving grants to individual startups Correct Answer Incorrect Answer
    B By directly investing in startups through equity investments Correct Answer Incorrect Answer
    C By providing capital to daughter funds, which then invest in startups Correct Answer Incorrect Answer
    D By providing loans to startups through SIDBI Correct Answer Incorrect Answer
    E By providing loans to startups through SIDBI Correct Answer Incorrect Answer

    Solution

    The  FFS Scheme  does not invest directly in startups but provides capital to  daughter funds  (AIFs registered with SEBI). These daughter funds then invest in  growing startups  through equity and equity-linked instruments, helping to support their growth. This approach allows FFS to act as a funding facilitator without directly interacting with individual startups.  

    Practice Next