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Korea's SMBA, IDG form $91m VC fund

  • Holden Mann
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IDG Capital Partners and South Korea's Small and Medium Business Administration have agreed to form a KRW100 billion ($91 million) VC fund that will help Korean businesses enter the China market.

According to BusinessKorea, IDG will commit more than 60% of the fund in Korean companies, chiefly in the healthcare, digital content, and technology fields. IDG will also help investees identify cooperation opportunities with Chinese companies and move towards IPOs or acquisitions by global players.

IDG and other foreign investors will contribute 60% of the corpus.

The SMBA said that South Korea's proposed free trade agreement with China has inspired interest among small businesses in entering the country. It selected IDG as a partner due to the firm's experience with hardware and software developers. The VC firm's past and current investments include Xiaomi, Baidu, Tencent and Ctrip.

The SMBA formed a similar fund last year with DFJ and Walden International. Both that $150 million vehicle and this one are intended to help Korean start-ups compete internationally. They will operate alongside the Korean Yozma Fund, which was inspired by Israel's Yozma Fund and is seeking to raise KRW200 billion in the next two years.

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