Karnataka Startup Policy 2025–2030: What It Means for Founders in Shivamogga and Beyond Bengaluru
Updated 24 October 2026. Policy details, application windows and eligibility change; always check Karnataka's official startup portal and government notifications before applying.
For years, "startup in Karnataka" meant Bengaluru. The state's Startup Policy 2025–2030 sets out to change that. Approved by the state cabinet in November 2025 with an outlay of about ₹518 crore, it aims to help create around 25,000 startups in five years, with roughly 10,000 outside Bengaluru.
If you're building something in Shivamogga, Mysuru, Hubballi-Dharwad, Mangaluru, Kalaburagi or another tier-2 city, this is the policy to understand.
The policy at a glance
| Area | What's been reported |
|---|---|
| Outlay | About ₹518 crore over five years |
| Target | ~25,000 startups; ~10,000 outside Bengaluru |
| Regional focus | Clusters such as Mysuru, Mangaluru, Hubballi-Dharwad and Kalaburagi, plus other districts |
| Funding | A fund of funds (reported at ~₹500 crore) for longer-gestation startups; a Beyond Bengaluru Cluster Seed Fund; an alternate investment bridge for private capital |
| Flagship programme | Elevate NxT for deep tech startups |
| Incentives | One-time capital grants (up to ₹50 lakh reported) for private incubators; PF and ESI reimbursement of ₹3,000 per employee per month for two years (capped per company); subsidies for cloud and R&D |
| Priorities | AI, blockchain, quantum, semiconductor design and other deep tech; women-led ventures; research commercialisation; sustainability |
It builds on Karnataka's earlier startup policies from 2015 and 2022.
What it means for Shivamogga founders
More attention, more programmes. A target of 10,000 startups outside Bengaluru means more incubators, events and seed funding in regional clusters. Shivamogga's colleges, such as JNNCE and Kuvempu University, and its agriculture, education, tourism and manufacturing base are natural starting points.
Agri and food tech. Shivamogga and the Malnad region grow areca, pepper, coffee, spices and rice. Startups in processing, traceability, direct-to-consumer brands and farm services have a local edge. See selling Malnad farm products online.
Hiring locally becomes cheaper. PF and ESI reimbursement helps startups that hire full-time staff, which fits tier-2 cities where talent is available but often leaves for Bengaluru.
Deep tech isn't only for Bengaluru. Remote work, cloud subsidies and statewide programmes like Elevate NxT mean a strong technical team can build from Shivamogga.
Not every business is a "startup" here
Government startup schemes usually target innovative, scalable businesses, not every new shop or service. A café or a salon is a valuable business but typically won't qualify for startup incentives; MSME schemes and bank loans fit better. Our funding and government schemes guide covers both routes.
How to get ready to apply
Schemes are competitive. Evaluators look for evidence you're real and serious. Prepare these now:
- Register a legal entity. Usually a private limited company or LLP. See what to do after registering a company
- Get DPIIT recognition where applicable; many state and central benefits reference it
- Register on Karnataka's startup portal and watch for calls under Elevate and regional programmes
- Build a credible online presence: a clear website, product demo, team page and contact details. Evaluators and investors will look you up. See launch a new business online in 30 days
- Document traction: users, pilots, revenue, letters of intent, problem interviews. See how to validate a business idea
- Keep accounts clean: GST, bank statements, founder agreements and IP assignments
- Connect with incubators in your region; they often know about calls before they're widely publicised
Use the ecosystem events
The Bengaluru Tech Summit 2026 (17–19 November) is where many state programmes, incubators and investors gather. Read our founder's guide to BTS 2026.
What the policy can't do for you
Grants and incentives help, but they don't find customers. The startups that benefit most are the ones that already have a working product, early users and a clear plan. Use schemes to accelerate, not to start.
Where we fit
We work with founders in Bangalore and Shivamogga to build the things evaluators, investors and customers look at first: a credible website, an MVP, a pitch-ready landing page and the first marketing that proves demand. See MVP development, website development and our Shivamogga page.
Building a startup outside Bengaluru? Get a free launch plan.
Sources
- Outlook Business: Karnataka unveils ₹518 Cr startup policy to build 25,000 ventures by 2030
- Analytics India Magazine: Karnataka cabinet approves startup policy
- Entrepreneur India: Karnataka Startup Policy 2025–2030 with ₹518 Cr allocation
- Deccan Herald: Karnataka aims to create 25,000 startups in 5 years
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