Fostering Future ICT Unicorns... Up to 10 Billion KRW Guarantee Support for 15 Companies This Year
[Asia Economy Reporter Seulgina Jo] The government will guarantee up to 10 billion KRW in growth funds and assist global expansion to help promising small and venture companies in the information and communication technology (ICT) sector grow into unicorn companies in the near future.
The Ministry of Science and ICT announced on the 13th that it signed a mutual cooperation agreement with four organizations?Korea Credit Guarantee Fund, Korea Telecommunications Operators Association, Seoul Guarantee Insurance, and Born2Global Center?to promote the ‘Global ICT Future Unicorn Growth (ICT GROWTH)’ program.
This is based on a shared recognition that high-growth companies play a key role in creating new jobs and economic growth, and that it is urgent to discover promising innovative companies and provide strategic, focused support.
The ICT GROWTH program is designed to create an ecosystem and support system that fosters high-growth ICT companies by combining government and private resources. Starting this year, the Ministry of Science and ICT plans to select and support about 15 companies annually, totaling 50 companies by 2025. Selected companies will receive a comprehensive package for up to three years, including guarantees for necessary growth funds, support for global market entry, and performance guarantee insurance, along with assistance in linking investment attraction activities during the support period.
Eligible applicants are small and medium-sized enterprises with global capabilities that have either received investments of 2 billion KRW or more from domestic or international institutional investors in the past three years since their establishment, or have achieved an average annual sales growth rate of over 10% in the last three years. The Korea Information and Communication Industry Promotion Agency, the dedicated agency for startup and venture support under the Ministry of Science and ICT, will form a selection committee to choose supported companies.
The Korea Credit Guarantee Fund will provide growth fund guarantees of up to 10 billion KRW per selected company (including facility funds, with up to 5 billion KRW for working capital). The guarantee conditions include a 100% guarantee ratio and a 0.5% guarantee fee rate, which is the highest level among policy finance institutions. Additionally, among the selected companies, investment target companies will be chosen to receive guarantee-linked investments of up to 3 billion KRW.
The Korea Telecommunications Operators Association will actively support priority screening for investment linkage for selected companies by creating a high-growth ICT investment fund using the Korea IT Fund (KIF). Seoul Guarantee Insurance will support expanding the guarantee limit of performance guarantee insurance, providing premium discounts, and offering free credit management services for small and medium enterprises.
To support the global expansion of selected companies, Born2Global Center will operate an ‘Overseas Expansion Intensive Growth Camp’ that supports domestic incubation and market validation. The Korea Information and Communication Industry Promotion Agency also plans to operate specialized programs for discovering local clients, attracting investment, and localization support over three months by utilizing overseas bases such as KIC Silicon Valley and the New Southern Region overseas IT support centers.
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At the signing ceremony held in Sangam-dong on the day, Jang Seok-young, the 2nd Vice Minister of the Ministry of Science and ICT, emphasized, “Leading startup support countries such as the United States and the European Union are shifting their support policies from focusing on early startup activation to scale-up and unicorn growth, considering job creation and economic ripple effects. We will continue strategic support through private cooperation so that promising ICT companies can grow into unicorn companies that succeed not only domestically but also in the global market.”
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