The Korean venture investment market in 2022 is summarized as a cold season. The venture investment for the third quarter of 2022 startups showed a 40% decrease compared to the third quarter of 2021. In the third quarter of 2022, venture funding was KRW 1,252.5 billion, a reduction of 40.1% (KRW 838.8 billion won) compared to the third quarter of 2021 (KRW 2.913 trillion).
Sentiments of uncertainty and prolonged interest rate hikes frame the deterioration in global venture investment.
However, even in this cold season of investments, some investors believe it to be the right time to invest in excellent startups at an appropriate value as the startup bubble bursts. Korea’s ‘1Billion Partners’ is one of the companies actively investing even in a recession.
1Billion Partners is a new investment company in Korea established in 2021. Since launching its first fund in October 2021, they have executed more than one monthly investment. The venture investment firm and accelerator has more than ten startups in its portfolio that are doing exceptionally well. 1Billion Partners supports startups’ global expansion and helps them create value through various activities.
Choi Sung-Hee and James Jung are the founders of 1Billion Partners. Sung-Hee has over 5 years of experience in PEF investments
and expertise in Growth stage investment and cross-border deals. Previously, he worked for IDG Capital’s Korean branch as a Director. James Jung has over 10 years of experience as a startup ecosystem professional. He is the CEO and Founder of beSUCCESS Media group and early-stage startup investment expert
The Korean government is also encouraging the vitalization of venture investment through various support for the Korean startup investment ecosystem. Korean government support includes tax benefits for startup investment and the TIPS program – an accelerator program in which the government supports R&D funds for technology startups. TIPS’ budget has been increased from KRW 293.5 billion won in 2022 to KRW 378.2 billion won in 2023, and the number of startups supported has risen from 500 to 720.
However, not all startup investments can receive tax benefits; only investments through funds established by companies holding a GP license as stipulated by Korean law. Under Korean law, GP licenses include ‘Accelerator,’ ‘Startup Investment Company,’ ‘New technology venture capital company,’ and ‘PEF GP’. In addition, only startups invested by TIPS partner companies can receive the support of the TIPS program, and only Accelerators or Startup Investment companies can become TIPS partners.
1Billion Partners has established 1Billion Accel, a subsidiary that can manage angel funds in Korea. 1Billion Accel has an accelerator license and is managing two angel funds. In addition, 1Billion Partners plans to establish 1Billion Private Equity to acquire PEF GP license and establish 1Billion Partners Singapore to advance into Southeast Asia.
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