Leading innovative growth and job creation through venture investment
- Division
- Investment Management Division
- Date
- 2018.08.01
- Writer
- Deputy Director HoJoong Lee
- File
- Headline
- Venture investment amounted to 1.6 trillion won in the first half of 2018, the highest amount ever.
SME invested in 2017 saw their employment increase by 3,191 people compared to the previous year.
Angel investment amounted to 0.2 trillion won in 2017, an increase of 13.7% compared to the previous year.
100 accelerators have been created in 19 months since the enactment of this scheme in November 2016.
Venture investment is leading innovative growth and job creation for SMEs and startups, contributing to the creation of a startup nation.
The Ministry of SMEs and Startups, Venture Capital Association and Korea Venture Investment announced the trend of venture investment for the first half of 2018. The results are as follows.
1. (New Investment) New venture investment in the first half of this year amounted to 1.6 trillion won, a 61.2% increase compared to the previous year. This increase is attributable to government measures such as Measures to Create an Innovative Startup Ecosystem in November 2017, Measures on Innovative Venture Ecosystem Led by the Private Sector in January 2018, Measures to Create an Innovative Startup Boom in May 2018. The greated investment in the first half was witnessed by BT, IT and the medical sector. It was attributable to a growing interest in future growth engines in the era of the fourth industrial revolution. Investment in the companies aged from 3 to 7 years amounted to 0.58 trillion won, an increase of 98.9% compared to the previous year, which is attributable to policy objective of promoting growth of startups and overcoming the so-called Death Valley.
2 (Achievements) An analysis of companies that attracted venture investment from 2013 to 2017 showed that venture investment has a large effect on employment increase of startups and business ventures. 2,649 companies that attracted venture investment from 2013 to 2017 created about 28,000 jobs compared to the previous year before the investment was made. Out of this, 529 companies invested in 2017 created 3,191 jobs, an increase of 21.8% compared to the previous year. Venture investment is expected to reach 3 trillion won by year end, and invested companies are expected to create additional 5,300 jobs.
3. (Recovery) According to Venture Capital Association, venture capitalists recovered a total of 1.2 trillion won, an increase of 126% compared to the first half of last year by means of public offerings, shares selling, etc. This is due to an improvement in the atromoshphere of the recovery market.
MSS also said that personal investment in early stages of startups is increasing. Angel investment in 2017 amounted to 0.28 trillion won, an increase of 13.7% compared to last year's investment of 0.24 trillion won due in part to increased tax benefits for angel investments. It is possible to apply for income deduction for three years after the year of investment. Therefore, 2017 investment is expected to reach 0.4 trillion won if angel investment is calculated by 2020.
If you look at the status of establishments of venture investment companies for the first half of 2018, you will see that 10 companies have been created, an increase of two companies compared to the corresponding period of the previous year. Therefore, as of the end of June, 2018, 126 companies are in operation. This is due in part to a relaxation of capital requirement for venture invesetment companies since last October, and the resulting freedom in market entry. In the first half of this year, 45 accelerators have registered, resulting in accumulated registration of 100 companies since the scheme was introduced in November 2016. It is expected that accelerators will play the role of identifying and growing early-stage startups through investing in them, thereby cementing a startup ecosystem.
Officer for Startup and Venture Innovation said that venture investment this year is expected to exceed 3 trillion won, which is greater than last year's new investment of 2.4 trillion won if the current trend continues, adding that this is the evidence of a leap in the entire venture ecosystem, as can been seen by the creation of a booming investment market led by the private sector. He emphasized that the ministry will lead innovative growth and job creation by expanding the participation of large enterprises in venture funds and creating a virtuous cycle from investment and growth to recovery and re-investment.
The Ministry of SMEs and Startups, Venture Capital Association and Korea Venture Investment announced the trend of venture investment for the first half of 2018. The results are as follows.
1. (New Investment) New venture investment in the first half of this year amounted to 1.6 trillion won, a 61.2% increase compared to the previous year. This increase is attributable to government measures such as Measures to Create an Innovative Startup Ecosystem in November 2017, Measures on Innovative Venture Ecosystem Led by the Private Sector in January 2018, Measures to Create an Innovative Startup Boom in May 2018. The greated investment in the first half was witnessed by BT, IT and the medical sector. It was attributable to a growing interest in future growth engines in the era of the fourth industrial revolution. Investment in the companies aged from 3 to 7 years amounted to 0.58 trillion won, an increase of 98.9% compared to the previous year, which is attributable to policy objective of promoting growth of startups and overcoming the so-called Death Valley.
2 (Achievements) An analysis of companies that attracted venture investment from 2013 to 2017 showed that venture investment has a large effect on employment increase of startups and business ventures. 2,649 companies that attracted venture investment from 2013 to 2017 created about 28,000 jobs compared to the previous year before the investment was made. Out of this, 529 companies invested in 2017 created 3,191 jobs, an increase of 21.8% compared to the previous year. Venture investment is expected to reach 3 trillion won by year end, and invested companies are expected to create additional 5,300 jobs.
3. (Recovery) According to Venture Capital Association, venture capitalists recovered a total of 1.2 trillion won, an increase of 126% compared to the first half of last year by means of public offerings, shares selling, etc. This is due to an improvement in the atromoshphere of the recovery market.
MSS also said that personal investment in early stages of startups is increasing. Angel investment in 2017 amounted to 0.28 trillion won, an increase of 13.7% compared to last year's investment of 0.24 trillion won due in part to increased tax benefits for angel investments. It is possible to apply for income deduction for three years after the year of investment. Therefore, 2017 investment is expected to reach 0.4 trillion won if angel investment is calculated by 2020.
If you look at the status of establishments of venture investment companies for the first half of 2018, you will see that 10 companies have been created, an increase of two companies compared to the corresponding period of the previous year. Therefore, as of the end of June, 2018, 126 companies are in operation. This is due in part to a relaxation of capital requirement for venture invesetment companies since last October, and the resulting freedom in market entry. In the first half of this year, 45 accelerators have registered, resulting in accumulated registration of 100 companies since the scheme was introduced in November 2016. It is expected that accelerators will play the role of identifying and growing early-stage startups through investing in them, thereby cementing a startup ecosystem.
Officer for Startup and Venture Innovation said that venture investment this year is expected to exceed 3 trillion won, which is greater than last year's new investment of 2.4 trillion won if the current trend continues, adding that this is the evidence of a leap in the entire venture ecosystem, as can been seen by the creation of a booming investment market led by the private sector. He emphasized that the ministry will lead innovative growth and job creation by expanding the participation of large enterprises in venture funds and creating a virtuous cycle from investment and growth to recovery and re-investment.