South Korea is doubling down on artificial intelligence (AI) and deep-tech as the country sharpens its unicorn strategy. The Ministry of SMEs and Startups (MSS) has selected 15 venture fund managers to deploy ₩600 billion (US$430 million) under its Fund-of-Funds program. With competition intensifying in global technology leadership, this initiative signals Korea’s determination to accelerate promising startups from early-stage to scale-up.

Korea’s 2025 Fund-of-Funds Second Round Results

On September 11, the Ministry of SMEs and Startups (MSS) announced the final selection of 15 venture fund managers under the 2025 Second Round of the Fund-of-Funds Regular Commitment Program.

• Total fund size: ₩600 billion (approx. US$430 million)
• Government commitment (Mother Fund): ₩310 billion
• Competition rate: 6.5:1

From the total amount, here’s the breakdown for the fund management projects:

• NEXT UNICORN Project Startup Funds: 9 funds, ₩260 billion
• NEXT UNICORN Project Scale-up Funds: 2 funds, ₩310 billion
• Early-Stage Small Funds: 4 funds, ₩20.1 billion

Although individual fund names and managers have not yet been publicly announced, the selected funds are required to complete formation within three months and begin making investments within 2025.

NEXT UNICORN Project: Large-Scale AI & Deep-Tech Focus

At the center of this round is the NEXT UNICORN Project, which targets startups in artificial intelligence (AI) and deep-tech fields.

• The Startup Funds will channel early-stage capital into ventures founded by professionals with industrial or research expertise.
• The Scale-up Funds will provide average allocations exceeding ₩10 billion per company, focusing on firms recommended by public institutions under MSS-supported programs.

Significantly, Coupang, Korea’s first unicorn, has joined as a major investor by committing ₩75 billion (~ US$54 million). Together with the Fund-of-Funds (Mother Fund)’s matching ₩75 billion, a ₩150 billion “AI Convergence Scale-up Fund” will be created (~US$108 million).

Supporting Korea’s AI and Deep-Tech Unicorn Development Policy

Han Seong-sook, Minister of SMEs and Startups, underscored the importance of private participation:

“This selection reflects strong private-sector support for the government’s AI and deep-tech unicorn development policy. The Fund-of-Funds will expand its backing so that promising companies grow into global leaders driving Korea’s future economic growth.”

Strengthening Korea’s Potential Unicorn Pipeline

This fund round reflects Korea’s strategic pivot toward AI and deep-tech leadership at a time when the U.S., China, and Europe are also scaling national innovation funds. By mobilizing ₩600 billion, Korea is not only bridging the capital gap for early-stage founders but also strengthening its pipeline of potential global unicorns.

Not only that, but Coupang’s entry into the initiative is also particularly symbolic. As Korea’s flagship unicorn and NASDAQ-listed e-commerce giant, Coupang’s direct participation in nurturing new deep-tech startups underscores a growing culture of corporate venture co-investment. This model could accelerate knowledge transfer and foster stronger commercialization pathways for Korean innovators.

Eventually, this program signals global investors that South Korea is reinforcing its venture capital hub role in Asia, especially in next-generation technologies where competition for talent, IP, and market share is intensifying.

NEXT UNICORN Project: a Public–Private Engine for Global AI & Deep-Tech Leadership

By selecting 15 fund managers for the ₩600 billion (~US$430 million) commitment, South Korea is setting clear trajectory to secure its position in the global AI and deep-tech race by accelerating startups into scale-ups and beyond. The involvement of both government and corporate leaders highlights a hybrid public-private model designed to create sustainable unicorn growth.

In the end, with the evolving Korea’s venture ecosystem, the NEXT UNICORN Project could redefine how domestic startups access capital, scale globally, and compete in frontier technology markets. This also marks another sign for global founders and investors that Korea is positioning itself as a central node in the Asia-Pacific innovation landscape.

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