Government Accelerates Realization of 'Startup Korea' with 1.7 Trillion Won Venture Fund Establishment

Selection of Mother Fund Management Companies Within the First Half of the Year

The government is set to create a fund worth 1.7 trillion KRW to serve as a catalyst for venture investment.

The Ministry of SMEs and Startups announced on the 4th that through the "2024 Mother Fund 1st Regular Capital Contribution Announcement," it plans to invest 910 billion KRW to establish a venture fund totaling 1.7 trillion KRW.

This represents the full 910 billion KRW budget allocation for the 2024 Mother Fund by the Ministry of SMEs and Startups, demonstrating the government's commitment to playing a catalytic role in accelerating the early recovery of venture investment.

Among the main investment areas of this 1st regular capital contribution project is the "Global Fund," which will receive a record-high investment of 150 billion KRW to create a fund exceeding 1 trillion KRW. The Global Fund supports domestic startups in attracting overseas investment.

[Image source=Yonhap News]

Additionally, a record-high 100 billion KRW will be invested in the "Regional Venture Fund," which focuses on ventures and startups outside the metropolitan area. This includes the "Regional Innovation Venture Fund (55 billion KRW)" co-created with local governments and public institutions, the "Regional Early-Stage Startup Fund (20 billion KRW)" open to local startup incubators and technology holding companies, and the "Lycon Fund (15 billion KRW)" which focuses on entrepreneur-type small business owners located in the region.

Furthermore, over 100 billion KRW will be allocated exclusively to the "Rookie League" for newly established and small venture capital firms, with a complete overhaul of the operating method to allow rookie venture capitals to directly propose challenging investment areas. The Rookie League targets venture capital firms with less than 5 years of experience and asset management under 100 billion KRW.

The Ministry of SMEs and Startups plans to allocate about 10% of the total capital contribution budget, approximately 100 billion KRW, to the Rookie League, and will consider additional budget allocation if venture capitals submit many innovative proposals.

The "Startup Korea Fund," jointly established by the Mother Fund along with large corporations, financial institutions, and successful venture companies, is currently surveying the willingness of private investors to participate.

Meanwhile, the Ministry will restructure the operation system to significantly favor venture capitals that actively execute venture investments throughout the year in the capital contribution project evaluation. It will also focus on rapid supply of investment funds by evaluating venture capital selections primarily based on the "fund’s ability to be quickly formed."

Minister Oh Young-joo of the Ministry of SMEs and Startups stated, "We will make this year the inaugural year of realizing 'Startup Korea,' swiftly advancing key policies including the Mother Fund, and focus on producing tangible results."

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