KIC Forms KVG No.3 Fund Worth 300 Billion KRW in First Half of the Year

Venture Investment Started in 2017... Series Funds 'Sailing Smoothly'
Faster Decision-Making System Established Compared to Other Alternative Asset Investments

Korea Investment Corporation (KIC) is accelerating the formation of the ‘KVG Fund III.’ It is expected to revitalize the frozen venture investment market.

According to the investment banking (IB) industry on the 12th, KIC is pushing to establish the KVG Fund III with a scale of 300 billion KRW within the first half of this year. Following the operation of KVG Fund I and II with $200 million in 2019 and $300 million in 2021 respectively, this will be the third series fund.

KIC plans to increase investments in Silicon Valley startups in the U.S. through the KVG Fund III. Since starting venture investments in 2017, it has recently made commitments mainly to top-tier general partners (GPs) in Silicon Valley. It has continuously created venture investment funds, playing a pioneering role in the industry.

KIC opened a local office in San Francisco in early 2021. It is regarded as one of the leading domestic public institutional investors to start venture investments proactively. So far, it has executed investments in over 10 global venture management firms and more than 20 venture companies.

Additionally, KIC plans to strengthen sector research to enhance direct investment expertise and focus on generating better management performance. It will actively seek co-investment opportunities by collaborating with local corporate venture capital (CVC) led by Silicon Valley-based companies for domestic firms.

KIC operates the ‘KVG Program’ for faster decision-making. Recently, as many investment funds have been waiting to invest in fields such as artificial intelligence (AI), cybersecurity, and digital health, it has established a faster decision-making system compared to other alternative asset investments.

Using the KVG Fund, KIC makes direct commitments to individual VC funds and direct or co-investments in individual companies. Unlike the buyout strategy that acquires management rights, the venture investment strategy features smaller investment sizes per case but repeated funding rounds for the same company. To enhance the scalability of the venture investment strategy, KIC adopts a ‘staged investment strategy’ by investing small amounts in promising startups at early growth stages and increasing investment size as growth potential is confirmed.

Furthermore, centered on the San Francisco office, KIC plans to conduct in-depth research in sectors such as fintech, digital health, cybersecurity, and AI/ML to strengthen its direct investment capabilities.

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