Number of VC firms hit record high

The number of Korean venture capital investment firms reached a record high of 118 on the back of the government’s drive to support local start-ups in line with its policy to develop a creative economy, according to the Small and Medium Business Administration on Wednesday.

This is also due to relaxed regulations enabling VC firms to be set up with equity capital of 5 billion won. Previously, Korea only allowed VCs with more than 7 billion in equity capital to be established.

In addition to the government’s creative economy policy, the rise in the number of VCs is attributable to a slew of companies trying to find “the next big thing” in technology such as bio, content and software by investing in VC funds as they face limited growth, industry sources said.

“With limits to finding new growth through conventional methods, companies are investing in VC funds,” said a VC source.

In 2015, 14 new VC funds registered, totaling 115. The number of VCs reached 117 in 2003, the highest following the dot-com boom.

Newly registered VC funds include Blue Investment and Solaire Investment this month, according to the Korean Venture Capital Association.

By Park Hyong-ki (hkp@heraldcorp.com)