South Korea’s Ministry of SMEs and Startups launched a startup fund on Wednesday in a move to boost venture investments.

According to the ministry on Wednesday, it held a ceremony to launch the Startup Korea Fund, a fund created jointly by the government and large corporations, financial institutions, and small and medium-sized enterprises.

The fund is characterized by the government providing enhanced incentives such as priority loss coverage, co-growth evaluation bonuses, and government awards to encourage more aggressive venture investments from the private sector.

In general, government-funded venture capital investments involve the government contributing around 60 percent of the funds, but the Startup Korea Fund operates with 30 percent of government funding and 70 percent of private sector investment.

This year, 21 private investors will invest more than 300 billion won ($219.38 million) combined, with the government contributing over 200 billion won, totaling more than 500 billion won in joint public-private investments.

The fund plans to raise and invest approximately 800 billion won moving forward.

Seven companies, including Hanwha TotalEnergies Petrochemical Co. and Kakao Mobility Corp., will participate in a venture fund for the first time through the Startup Korea Fund.

“We expect that the Startup Korea Fund will become the most successful venture fund ever, enabling more companies and financial institutions to easily and boldly invest in our venture and startup ecosystem,” said Minister of SMEs and Startups Oh Young-ju.

The ministry plans to select a fund manager after announcing investment projects in May 2024, with full-scale operations planned for the second half of the year.

By Pulse

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