Korea Venture Investment Corp. said on the 30th that it has formed a fund of funds that will invest in venture companies and startups using cooperation funds contributed by large companies, state-run firms and financial groups.
The fund follows a revision to the enforcement decree of the law on cooperation between large companies and smaller firms, which allowed money in corporate partnership funds to be invested in venture capital partnerships. The change created a channel for contributing companies, including large corporations, state-owned enterprises and financial groups, to invest in small and venture businesses through their contributions.
The main goal is to build what the company describes as a virtuous cycle of cooperation that promotes technology partnerships and narrows wage gaps while helping venture companies and startups raise growth capital.
The first such fund is being set up with a donation from KB Financial Group. KB Financial Group contributed 3 billion won to a win-win cooperation fund managed by the Korea Foundation for Cooperation of Large & Small Business, Rural Affairs to support investment in companies that generate social value, and the foundation in turn invested that money in the fund of funds operated by Korea Venture Investment.
Korea Venture Investment plans to raise sub-funds totaling at least 5 billion won through the vehicle. The sub-funds will channel money to impact companies, which pursue financial returns and solutions to social problems at the same time while offering innovation and growth potential.
"Through this fund of funds, we will serve as a bridge so that contributions from large companies and others flow smoothly into the venture investment ecosystem," Korea Venture Investment Chief Executive Lee Dae-hee said. "Korea Venture Investment will further strengthen its role as a venture investment platform."
