South Korean Ministry of SMEs and Startups (MSS) and the Korea Venture Capital Association (KVCA) convened a “Venture Capitalists’ Forum” to discuss the global decline in venture investment and identify strategies to revitalize the country’s venture and startup ecosystem.
Representatives from MSS and KVCA, investment reviewers, and other industry stakeholders attended the forum.
South Korea’s venture fund formation and investment performance in the first quarter of 2023 showed a year-on-year decline of 78.6% and 60.3%, respectively.
However, Minister Lee emphasized that the figures represent an increase of 13-14% compared to the same period in 2019 and 2020. She attributed the decline to the extraordinary investment surge in 2021 and 2022.
To support the venture and startup ecosystem, MSS plans to invest KRW 1 trillion ($749 million) in seed equity funds in 2023 to create more than KRW 2 trillion ($1.5 billion) in funds.
The ministry will also strengthen R&D in deep-tech areas and support growth through regulatory innovations, such as global innovation special zones and expansion of global funds.
To help Korean startups grow and expand overseas, the government plans to improve laws, systems, and infrastructure and create a “Startup Korea” policy to encourage overseas workers to start businesses in the country.
In addition, MSS will work with the Financial Services Commission on measures to improve venture and startup companies’ financing conditions and competitiveness.
The Korea Venture Capital Association President stressed the importance of venture capital firms and startup companies discovering excellent companies and adapting to market conditions.
Participants also discussed various proposals to revitalize the secondary market and improve the support system for corporate venture capital (CVC).
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