South Korea and Singapore are setting up a $213.2-million fund to invest in startups looking to enter the two markets, according to a report by The Korea Herald.
The fund will be backed by the state-backed funds of both countries — Korea Venture Investment Corp (KVIC) and Temasek – who will also act as limited partners. The manager of the fund is yet to be confirmed.
The size of the fund may expand depending on the volume of Temasek’s investment, while KVIC’s investment is fixed at 95 billion won and will not exceed 40 per cent of the fund. Temasek is said to be investing at least half of the pledged amount.
The fund will be created within six months and operate for 10 years. The move comes one month after a memorandum of understanding (MOU) was signed to boost cooperation between small enterprises and startups from the two nations.
In July, South Korean President Moon Jae-in made a state visit to Singapore where he urged for closer cooperation with ASEAN nations.
This is not the first time the two countries have set up a fund together.
In 2015, KVIC partnered Singapore-based Adval Capital to set up a $40-million fund to help small and medium-sized enterprises and startups expand into the two markets. The investment went into a number of South Korean and Singaporean startups in the fields of technology and digital content.