Korea Development Bank: "Last Year Recorded the Highest Growth in Venture Ecosystem"…4Q Venture Index Up 54.5% YoY

[Asia Economy Reporter Bu Aeri] KDB Industrial Bank announced on the 8th that the KDB Venture Index in the last quarter reached 503.7, an increase of about 54.47% compared to the previous year. According to the KDB Venture Index, the domestic venture ecosystem grew rapidly last year, recording the highest growth rate ever.

The KDB Venture Index was developed by the Industrial Bank to comprehensively monitor the domestic venture ecosystem.

The bank explained that the KDB Venture Index in the last quarter of last year means that the current market environment surrounding the domestic venture ecosystem has improved about fivefold compared to the base year 2008 (index=100).

According to the bank, the KDB Venture Index has shown a steep growth trend over the past two years, rising about 80% since early 2020.

By detailed index, the investment resource index led the overall venture index increase with 862.1, up about 97% compared to the same period last year.

Last year, venture funds were raised at a record high of 9.2 trillion KRW in total, with 3.9 trillion KRW raised in a single quarter, also a record high. The proportion of private sector investment in raised funds increased by about 10.2 percentage points to 70.2% compared to five years ago.

The bank stated, "This is because private capital inflow was active due to the revitalization of the venture market and increased investment attractiveness," adding, "It means that the supply of funds in the venture ecosystem is smooth without policy fund intervention."

The investment performance index was 532.1, up about 42% compared to the previous year.

Last year, venture investment totaled 7.7 trillion KRW, the highest ever, with 2.4 trillion KRW recorded in a single quarter, also a record high.

By industry, venture investment in ICT, bio-medical, and distribution services sectors, which emerged as promising industries in the COVID-19 era, accounted for 72.4% of total investment.

However, investment was concentrated more on mid-to-late stage companies with a business history of 3 years or 7 years or more, rather than early-stage companies with less than 3 years of operation. Investment in mid-stage companies more than doubled compared to the previous year. The bank noted that active investment in early-stage companies seems necessary for the long-term soundness of the venture ecosystem.

The recovery condition index in the last quarter of last year was 224.3, up 19.2% compared to the previous year. A total of 100 companies newly listed on the KOSDAQ market last year, showing a gradual increase in recovery through KOSDAQ IPOs.

A bank official said, "To expand future new growth engines, we are dramatically increasing fund formation and direct investment to support next-generation promising venture companies every year," adding, "We will focus our capabilities to promote innovative growth by continuously pursuing large fund formation and expanding financial support."

This content was produced with the assistance of AI translation services.