T.N. CM Stalin announces launch of co-creation fund to support startups

The Tamil Nadu government will create a co-creation fund with an allocation of Rs 100 crore to invest in venture capital funds, Chief Minister MK Stalin said at the launch of the Global Startup Summit in Coimbatore on Thursday, October 9, 2025.

“At this summit, I would like to announce a new initiative aimed at further strengthening Tamil Nadu’s startup ecosystem. A dedicated co-creation fund of Rs 100 crore will be set up. The fund will be managed by the Tamil Nadu Startup and Innovation Mission (StartupTN),” he said.

Under this programme, the government will invest in venture capital funds that will invest in startups based in Tamil Nadu. This initiative will lead to the establishment of new venture capital firms in the state and will also attract the interest of leading global investment firms, Mr. Stalin added.

Inaugurating the Global Startup Summit hosted by Startup TN, the Prime Minister said that Tamil Nadu is attracting investments from high-tech and labor-intensive sectors. “Our government is working diligently to achieve the target of transforming Tamil Nadu into a $1 trillion economy by 2030.”

As far as the industrial sector is concerned, the aim of the ‘Dravidian model’ government is to spread startup awareness in every district of the state, Mr. Stalin said. The government’s new-age entrepreneurship initiatives must reach people from all walks of life, including women, youth, marginalized communities, people with disabilities and transgender people. “Social justice is the essence of Dravidian model politics, even in startup politics,” he said.

TN’s startup growth

In the last four years, the number of startups in the state registered on the Union government’s platform has increased sixfold from 2,032 to 12,000 compared to previous years. And half of them are run by women. Tamil Nadu ranked last among Indian States in terms of startup infrastructure in 2018. In just four years, by 2022, the State has risen to the top of the list of States with the best start-up ecosystem. According to the Global Startup Ecosystem Report 2024 published by Startup Genome, Chennai is ranked 18th^he in Asia. Mr. Stalin said that the Atal Innovation Mission operating under NITI Aayog has recognized Tamil Nadu as an exemplary State in developing an excellent innovation ecosystem.

In recent years, the capacity of startups in Tamil Nadu to raise investments has increased significantly. According to the Inc42 report, the average investment raised by startups increased from $1 million in 2016 to $6 million in 2024; This reflects investors’ increasing confidence in Tamil Nadu-based startups. Between FY 2020 and FY 2025, the number of startups in Tamil Nadu recognized on the DPIIT platform recorded a compound annual growth rate (CAGR) of 36%; this is three times the national average of 11%.

Considering the increasing number of startups in Tamil Nadu, a special budgetary allocation of ₹20 crore has been made for this program in the current financial year, he noted.

Equity investments are provided in ventures run by entrepreneurs from Scheduled Castes and Scheduled Tribes. The allocation for this scheme has been increased from ₹30 crore in 2022-2023 to ₹50 crore in 2023-2024. Funds of ₹129.24 crore have been raised through the TANFUND platform, which was launched last year.

More than 250 participants from more than 40 countries attend the Global Startup Summit. Mr. Stalin said start-ups from 21 countries had set up special pavilions at the exhibition.