[Ministry of SMEs and Startups]
[Ministry of SMEs and Startups]

The Ministry of SMEs and Startups plans to establish an open innovation fund worth about 250 billion won ($162 million) this year targeting strategic industries such as biotech, defense and beauty, as part of efforts to promote open innovation through corporate venture capital.

The ministry held the "2026 Second-Quarter CVC Council" and "2026 CVC Link Day" events Friday alongside the Korea Venture Capital Association, unveiling the policy direction.

The fund will be set up in partnership with about 10 companies as part of the ministry's LP Growth Fund, which is co-financed with pension funds, corporations and financial institutions. The ministry plans to begin recruiting fund managers in the second half of this year.

Also starting this month, the ministry will begin full operations of an open innovation venture fund under which Korea Venture Investment will co-invest alongside large and mid-sized domestic and foreign companies that invest in startups through open innovation. The fund offers put options on a portion of investment stakes to both investors and startups to encourage open innovation partnerships.

According to CVC data analyzed by the ministry and the Korea Fair Trade Commission, there were 444 venture capital firms in South Korea as of the end of last year, of which 114 were CVCs. CVC investment last year totaled 2.9 trillion won, the highest since the ministry began tracking the figures in 2022.

"CVCs are establishing themselves as a key bridge connecting startup innovation with the broader industry," said Kim Bong-deok, the ministry's venture policy director. "We will continue to actively support the development of a more vibrant cooperation ecosystem between industry and startups."


boo@heraldcorp.com