Q1 Venture Investment Hits 3.3 Trillion Won... Venture Fund Formation Reaches Record 4.4 Trillion Won

Venture Investment Up 24% Year-on-Year, Venture Fund Formation Up 31%

Top Sectors: ICT Services, Bio/Healthcare, Electrical/Machinery/Equipment

In the first quarter of this year, venture investment reached 3.3 trillion won, the second highest amount ever recorded. The amount of newly established venture funds hit an all-time high of 4.4 trillion won.

According to the Ministry of SMEs and Startups' announcement on May 17 regarding the trends in new venture investment and venture fund formation for the first quarter of 2026, venture investment in Q1 totaled 3.3 trillion won, representing a 24.1% increase compared to the same period last year. The amount of newly established venture funds grew by 30.7% year-on-year to 4.4 trillion won. By investor type, policy finance increased by 82.0%, while the private sector rose by 19.8%.

Venture Investment Performance in Q1 2026. Ministry of SMEs and Startups

Compared to 2021, the amount of venture investment increased by 34.3%, and fund formation by 57.2%. This indicates that the venture investment market, which has been recovering since 2025, is now entering a phase of solid growth.

Comprehensive financial investment businesses, which are required to supply venture capital, invested 1.7 trillion won. Including this amount, over 5 trillion won in growth capital was invested in small and venture businesses in the first quarter alone.

By industry, the top sectors for investment were: ▲ICT services (21.4%), ▲bio and healthcare (20.5%), and ▲electrical, machinery, and equipment (15.3%). Investments in ICT services were concentrated as investment in AI-related fields increased, while the electrical, machinery, and equipment sector saw active investment driven by advances in robotics, fuel cells, aerospace, and other technologies.

Venture investment in the bio and healthcare sector increased by 313.9 billion won (85.5%) compared to the same period last year, mainly due to large-scale investments that expanded the overall size of the sector. Based on venture capital firms and associations, eight companies attracted large-scale investments of 10 billion won or more, with some cases even receiving investments exceeding 100 billion won.

Venture investment in the ICT manufacturing sector saw the highest growth rate at 99.5%, driven by major investments in the AI semiconductor field. Boss Semiconductor, a mobility-focused AI semiconductor design company founded in 2022, is cited as a representative example. After being selected for the Ministry of SMEs and Startups' "Super Gap Startup Project" in 2023 and receiving business funding, the company continued to attract large-scale investment in both 2025 and the first quarter of 2026, showing rapid growth.

In the first quarter, a total of 26 companies attracted large-scale investments of 10 billion won or more, including 10 located outside the Seoul metropolitan area. In Daejeon and North Chungcheong Province, large-scale investments were made in the bio and healthcare sectors, while in South Gyeongsang Province, the electrical, machinery, and equipment sector saw such investments. In South Gyeongsang Province, Songwol Technology, a company in the electrical, machinery, and equipment sector, attracted a large-scale investment. The company manufactures parts for aircraft and satellites using composite materials such as carbon fiber.

By company age, both those younger than seven years and those older than seven years saw increases in both investment amounts and the number of investee companies. However, for companies less than three years old, the number of investee companies rose by 8.9%, but the investment amount decreased by 9.5%. The shrinking share of investment in companies less than three years old appears to be the result of various complex factors affecting the venture investment market.

The trend of deep tech-driven venture investment is one such factor. The deep tech field, which has a high proportion of investment in companies older than seven years, is leading the overall venture investment market, resulting in a relatively lower share of investment going to early-stage startups. In the case of non-deep tech investment, more than 75% of investments go to companies under seven years old, including 37.3% to those under three years old.

Han Sung-sook, Minister of SMEs and Startups, stated, "Following 2025, which saw the second highest annual venture investment performance on record, it is a very positive sign that both venture investment and fund formation increased significantly again in the first quarter of 2026," adding, "The Ministry of SMEs and Startups will continue to expand its contributions to fund-of-funds and improve systems to encourage private investment, so that promising small and venture businesses can grow into unicorn companies without setbacks."

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