IBK chief heads to Silicon Valley to strengthen support for startups

Industrial Bank of Korea (IBK) CEO Yoon Jong-won delivers a speech commemorating the bank's 60th anniversary at its headquarters in Seoul on July 30, 2021. Courtesy of IBK

State-run bank aims to boost role as accelerator in supporting startups

By Anna J. Park

Industrial Bank of Korea (IBK) CEO Yoon Jong-won has kicked off a six-day business trip to Silicon Valley in the U.S. starting on Sunday, aiming to strengthen the bank's capacity to supply venture capital to burgeoning industries there.

The IBK chief plans to research and study the bank's roles in facilitating policy financing for startup businesses to survive the so-called “valley of death,” referring to the difficulty of overcoming cash shortages in the early stages of a startup.

During the trip, Yoon is scheduled to meet with top global accelerators and venture capital firms based in the U.S., including Y Combinator, 500 Startups and Plug and Play, on how to best support innovative startup companies.

The state-owned lender also plans to strengthen its relationship with Silicon Valley Bank (SVB), which has built up expertise in offering loans to venture companies during the past three decades.

Yoon is also slated to discuss ways to support local venture companies to advance into the global market along with state agencies like Korea Trade-Investment Promotion Agency (KOTRA).

After rising to the top position at the bank in early 2020, Yoon has frequently stressed the lender's unique position to provide a chance for innovative startup businesses to grow into global unicorn companies.

Since 2020, the bank has provided over one trillion won ($820 million) in venture capital and aims to offer up to 1.5 trillion won by the end of this year. Out of the invested money, the proportion of direct investments into fledgling startups ― companies that were launched less than three years ago ― has increased to 29.3 percent from 7.3 percent two years ago.

“We plan to strengthen our role as an accelerator by providing a variety of financial services, ranging from supplying venture capital and consulting services for startups in their early phases, thereby creating a synergy effect with IBK's original competitiveness,” an official at the bank said.