In November 2022, the government announced the creation of a private venture capital master fund as part of its “Plan to Create a Dynamic Venture Capital Investment Ecosystem” initiative. In March 2023, the National Assembly passed an amendment to the Venture Investment Act, and the plan officially took effect on October 19.
The venture capital master fund is a type of fund that invests in multiple venture capital feeder funds, which in turn invest in startups. The main objective of this fund is to increase the inflow of private capital into the venture capital investment industry by leveraging the master fund’s strengths in terms of stability, scalability, and expertise.
After institutionalizing a private venture capital master fund, Hana Financial Group became the first to raise a fund, marking the start of an era of a full-fledged private venture capital master fund.
Hana Financial Group is set to launch the first-ever private venture capital master fund, with a backing of KRW 100 billion. The fund will concentrate on investing in 10 deep tech sectors and will be managed by Hana Ventures for a period of 10 years.
During the event, MSS and Hana Financial Group held a priming ceremony to transition the venture capital ecosystem into a private sector-centered one.
Korea Venture Investment Corp. and Hana Ventures have signed a Memorandum of Understanding (MOU) to establish mutual cooperation. Korea Venture Investment Corp. has been managing the Fund of Funds, which is Korea’s flagship policy master fund, for 18 years. As part of the cooperation, Korea Venture Investment Corp. has committed to transferring its master fund management expertise to Hana Ventures.
After the launching ceremony, a panel discussion was held with the venture capitalists and academia to discuss the development of private venture capital master funds.
During the meeting, the panel talked about several proposals to enhance the funding of private venture capital master funds. Some of these proposals included allowing retirement pension funds to invest in venture capital investment associations and strengthening tax incentives. The panel also discussed introducing a publicly traded private venture capital master fund to expand the master fund.
Minister LEE Young stated, “I’m pleased to announce the launch of the private venture capital master fund, which is the first VC-related policy developed from the view of startups since I became the minister. It’s exciting that it’s been established within a year of its announcement. This fund, representing private-led venture capital investment, is a significant milestone for the industry. MSS is looking forward to supporting this initiative.”
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