Dong Geol Lee to Foster 'K-Unicorns' at US Silicon Valley VC

Establishment of VC Subsidiary in Second Half of This Year
Visited Silicon Valley in 2019 to Plan Support for Innovative Growth

[Asia Economy Reporter Park Sun-mi] "We plan not only to discover and invest in new companies but also to diversify and expand the scale of funds for the scale-up (high growth) of innovative startups." Lee Dong-geol, Chairman of KDB Industrial Bank, emphasized strengthening support for fostering new industries and discovering innovative companies at the New Year's press conference last January. At the same event, he also announced plans to establish a venture capital (VC) firm in Silicon Valley, USA, this year.

Since his appointment as chairman of KDB in September 2017, Lee has devoted efforts to spreading the Korean version (K) of the New Deal and supporting technology startups, and his plan has come to fruition. On the 15th, KDB announced that it had formed a preparatory committee to establish a local corporation in Silicon Valley, USA, and that it could establish a VC subsidiary within the second half of the year.

KDB originally planned to establish a Silicon Valley VC subsidiary last year to support domestic startups' overseas expansion, but the plan was delayed due to the spread of COVID-19. KDB's entry into Silicon Valley has been a focus of Chairman Lee for a long time. In 2019, he personally visited Silicon Valley and met with major VCs. He also contacted startup accelerators such as Plug and Play to explore ways for KDB to support startup discovery and the nurturing of unicorn companies.

After being reappointed last September, Chairman Lee has shown his commitment to supporting innovative companies to the extent that his last schedule of his first term was visiting the Yongin factory of Fresh Easy, the nation's top meal kit company, which KDB supported with 50 billion KRW in investment and loans.

The VC subsidiary to be established in the second half of this year is expected to help domestic startups expand overseas and support the nurturing of global K-unicorns (companies valued at over 1 trillion KRW). It is also expected to give momentum to KDB's support for the K-New Deal and technology startups.

Chairman Lee plans to provide bold financial support for promising startups with high growth potential, matching the current demand for large-scale scale-up investment and loans and differentiated support for innovative companies. To this end, in January last year, he established the Venture Finance Headquarters and the Scale-up Finance Office to build a system that supports all stages of venture company growth, from nurturing technology startups and unicorn companies to ecosystem creation. He also announced the 'New Deal Venture and Scale-up Investment and Loan Program' in January this year, planning to support 1 trillion KRW over five years until 2025.

Under Chairman Lee's leadership, KDB has been steadily fostering an innovative startup ecosystem. The market-type venture investment attraction platform 'KDB Next Round,' which involves startups and VCs, has been held 430 times cumulatively by the end of last year. The 358 participating companies succeeded in attracting about 2.2 trillion KRW in investment. The 'Next Rise' event, which helps venture and startup companies attract investment, started in 2019 and is preparing for its third session in June. The 'KDB Next One' acceleration program for early-stage startups at Mapo Front One is also scheduled to select and operate its third cohort in July.

KDB's establishment of a Silicon Valley VC subsidiary is considered timely, coinciding with the government's focus on New Deal policies to drive innovative growth and the KOSDAQ index recovering to the 1,000 level for the first time in 20 years since the dot-com bubble, continuing the 'second venture boom.' A KDB official said, "We will play a more active role in helping startups expand overseas and scale up to grow into global unicorns."