The revamped Tamil Nadu Startup and Innovation Policy 2023 has set a vision for the State to become one of the top 20 global start-up destinations by 2032. Launched by Chief Minister MK Stalin on Wednesday, the policy has over 50 action points to help the State become a leading start-up ecosystem.

The policy period of the first Tamil Nadu Startup and Innovation Policy was 2018-23. The revamped policy will accelerate and scale start-ups and increase their share in the State’s GDP and social capital. It defines and strengthens the seven determinants of the start-up ecosystem — start-up literacy; innovation landscape; start-up support centres; access to market; investment ecosystem; stakeholder engagement and equitable growth.

Tamil Nadu has witnessed a notable increase in the number of registered start-ups, exceeding 7,000 in September 2023, and has attracted significant venture capital investments over the past two years. The State is now committed to attaining the top ranks in the national and international ecosystems, across measures, with the collaborative efforts of various stakeholders in the start-up ecosystem, the policy said.

The objective of the policy is to facilitate establishment of 15,000 start-ups across various sectors and regions in the State

Mission

The mission stated in the policy include upscale start-ups’ contribution towards the State’s GDP share; provide start-ups in Tamil Nadu a conducive environment and seamless enablement throughout their journey provide; support business expansion by creating access to both domestic and global markets and implement a robust system to integrate intellect minds and infrastructure.

Investment ecosystem

Dedicated platforms will be created in collaboration with financial institutions, Venture Capitalists, Angel Investors, and other key stakeholders in the start-up ecosystem. These platforms will be promoted extensively to attract investors from across the globe who are interested in investing in innovative and disruptive start-ups in Tamil Nadu. By creating these platforms, the State hopes to provide a much-needed boost to the start-up ecosystem and drive economic growth.

The Tamil Nadu Start-up Seed Fund (TANSEED) has been revamped to function as a Support Equity-linked grant fund scheme that provides early-stage start-ups with funding of up to ₹15 lakh for rural impact, climate action and women-led start-ups, and ₹10 lakh for other sectors. As a part of the funding, StartupTN will take a 3 per cent support stake in the start-up ventures and provide them with a one-year accelerator programme that includes mentorship support, priority access to compliance support services, and various networking events and initiatives, the policy said.

Revival support

The Government of Tamil Nadu will provide support to start-ups that have viable products or services but are on the verge of closure for reasons like uncertainty in the next round of funding or inability to meet capital requirements, rising inflation & interest rates and any other logical reasons, the policy said.

A corporate Entrepreneur-in-Residence (EIR) programme will be launched in association with reputed industry associations as a transparent process to provide 50 per cent of the last drawn salary or ₹1 lakh (whichever is lesser) for a period up to 12 months to corporate executives to quit their jobs and start their own ventures. An accelerator programme will be co-created with the associations to mentor the EIRs during the period. This project may help some of the seasoned corporate executives to become entrepreneurs.

To facilitate a soft landing, and to attract investments from global investors for Tamil Nadu start-ups, ‘Global Coordination Centres’ under Beyond TN will be established strategically across the Globe in a phased manner. These offices will be the facilitating and liaison offices for homegrown start-ups. The first Global Coordination Centre will be established in Dubai in the current fiscal, the policy said.

Since the inception of Open Network for Digital Commerce, grass-root innovators and other small scale retailers are trying to emerge in this new platform. In order to fuel the growth of Tamil Nadu start-ups, this support centre will facilitate onboarding of such start-ups who can potentially market their products. Sensitisation programs across sectors will be conducted.

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