IBK establishes venture capital subsidiary

Industrial Bank of Korea (IBK) headquarters in Seoul / Courtesy of IBK

Industrial Bank of Korea (IBK) announced on Thursday that it has established IBK Venture Investment, a venture capital subsidiary, with an initial investment of 100 billion won ($77 million). This marks the first time the government-run bank has launched a venture capital firm.

The initiative follows a year after IBK CEO Kim Sung-tae announced the plan shortly after his inauguration.

As a policy-oriented venture capital firm, the subsidiary aims to supplement the private sector while aiding government policies. Its primary focus will be on providing substantial support to startups in their initial stages.

"The newly established venture capital will perform the role of angel investors," Kim said during a press meeting celebrating his first 100 days in office in April. "Our objective is to minimize the risk of overlooking the technical capabilities of early-stage startups."

The initial CEO will be Cho Hyo-sung, the former representative of SKS Private Equity who took charge of the strategic investment business. Born in 1965, Cho is a specialist in M&As and corporate restructuring. After graduating with a degree in economics from Seoul National University, he held prominent positions such as the head of corporate finance at Mirae Asset Securities, the head of private equity at Woori Asset Management and Kiwoom Asset Management, and as an executive in the private equity division at SK Securities.

"In the first half of 2024, IBK Venture Investment plans to acquire a financial license for new technology business, and to create a 100 billion won venture fund," an IBK official said. "IBK aims to address the financial support void in the new technology sector and ensure comprehensive support for the development of domestic technology enterprises."