Formation of Korea's Largest 550 Billion KRW VC Fund Imminent, with Contributions from National Pension Service, KDB, and Naver

[Asia Economy Reporter Park So-yeon] Major investors including the National Pension Service, Korea Development Bank, and Naver Corporation have confirmed their commitments to the largest domestic fund (KRW 550 billion) launched by venture capital (VC) firm Atinum Investment.

According to the investment banking (IB) industry on the 28th, Atinum Investment plans to complete the formation of the KRW 550 billion 'Atinum Growth Investment Partnership 2020' by May. Atinum has already raised KRW 467 billion through the first and second rounds of fundraising.

Through the first round of fundraising, the National Pension Service committed KRW 100 billion, Korea Development Bank KRW 61.9 billion, Government Employees Pension Service KRW 20 billion, Police Mutual Aid Association KRW 20 billion, Samsung Fire & Marine Insurance KRW 20 billion, Yellow Umbrella Mutual Aid Association KRW 20 billion, Industrial Accident Compensation Insurance Fund KRW 15 billion, Korea Telecommunications Operators Association KIF Investment Partnership KRW 12 billion, Korea Scientists & Engineers Mutual Aid Association KRW 10 billion, National Federation of Fisheries Cooperatives KRW 10 billion, Presbyterian Church of Korea Pension Foundation KRW 10 billion, and Naver Corporation along with three other institutions KRW 18 billion.

Subsequently, through the second round of fundraising, the Korea Post KRW 30 billion, Teachers’ Pension KRW 25 billion, Private School Teachers’ Pension KRW 20 billion, Government Employees Mutual Aid Association KRW 20 billion, and DB Insurance along with one other institution confirmed investments totaling KRW 15 billion.

Atinum Investment is reported to have proposed investments to NongHyup Central Association, NH NongHyup Bank, Hyundai Marine & Fire Insurance, KB Kookmin Bank, Construction Workers Mutual Aid Association, and Korea Securities Finance Corporation through the third round of fundraising, with plans to complete the fundraising next month.

The concept of this fund is 'Scale-up.' It aims to include companies with outstanding potential across industries, from early-stage to pre-IPO investment stages. Atinum Investment employs a strategy of managing a mega fund to provide follow-up investments aligned with the growth pace of companies.

The portfolio by industry is planned as follows: Deep Tech (Artificial Intelligence, Big Data, Cloud) 15-20%, Smart Manufacturing (Semiconductors, Future Vehicles, Robotics) 10-15%, Innovative Services & Platforms 35-45%, and Bio & Healthcare 20-30%. By growth stage, investments are planned as Early Stage 20% (around KRW 2 billion per deal), First Growth Stage 40% (around KRW 5 billion per deal), and Second Growth Stage 40% (around KRW 10 billion per deal).

The target return is an IRR (Internal Rate of Return) of 15%. The fund duration is 8 years from the formation date, with a staggered payment method. Key management personnel include CEO Shin Ki-cheon, President Hwang Chang-seok, Vice President Maeng Du-jin, and Executive Director Kim Je-uk.

Atinum Investment (formerly Hanmi Venture Investment) is a venture capital firm famous for its 'One-Fund' strategy and has pioneered the scaling up of domestic funds. It pursues an asset management strategy that concentrates investment capabilities into a single fund.

Since its establishment in 1988, it has formed 25 partnerships and successfully liquidated 22 of them. Currently, it manages assets worth KRW 1.1199 trillion through four funds. The company has 29 employees, including 18 investment professionals.