KOTEC and IBK Join Forces to Revitalize the Venture Investment Ecosystem
Up to 100 Billion Won in Special Guarantee Agreements to Be Provided
The Korea Technology Finance Corporation (KOTEC) announced on November 3 that it has signed a "Financial Support Business Agreement for Expanding Investment-Linked Funding for Innovative Startups" with the Industrial Bank of Korea (IBK). This agreement aims to provide timely funding for technology development and commercialization to promising technology startups that have attracted investment from venture capital institutions, thereby supporting their scaling up and revitalizing the venture investment ecosystem.
Under the agreement, KOTEC will supply up to 100 billion won in special guarantee agreements, using 5 billion won in special contributions from IBK as a financial resource, and will offer preferential benefits such as increasing the guarantee ratio (from 85% to 100% for three years). IBK will work to ease the financial burden on innovative startups by providing preferential loan interest rates (up to 1.5 percentage points), among other benefits.
Eligible applicants include unlisted small and medium-sized enterprises (SMEs) that meet KOTEC's technology guarantee requirements and have attracted at least 500 million won in investment from venture capital institutions within seven years of founding, as well as unlisted SMEs with a technology business evaluation grade of BB or higher that have secured at least 2 billion won in investment within the past two years.
Through this agreement, the two institutions plan to expand financial support so that startups can stably secure the funds they need before entering subsequent investment rounds, and to work closely together to build a growth ladder for technology startups and vitalize the venture ecosystem.
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Kim Joungho, Chairman of KOTEC, stated, "This agreement has laid the foundation for innovative startups that have attracted investment to overcome the 'death valley' and secure liquidity in a timely manner. KOTEC will continue to expand collaboration with related organizations to resolve financial challenges for technology startups and take the lead in creating an ecosystem where startups can grow stably."
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