Kibo, Expansion of Investment-Linked Guarantees... "Contributing to the Revitalization of the Venture Investment Market"

Supply of 150 Billion KRW in the Second Half to Sustain Growth Momentum of Innovative Companies

[Asia Economy Reporter Kim Cheol-hyun] The Korea Technology Finance Corporation (Chairman Kim Jong-ho, hereinafter referred to as Kibo) announced on the 4th that it will expand the 'Venture Investment-Linked Guarantee' and operate the 'VC Venture Fund Special Guarantee' as a permanent system to supplement the shrinking investment market and strengthen policy support for the venture capital market.

The Venture Investment-Linked Guarantee is a guarantee provided by Kibo to companies that have received investment from private venture capital (VC). It was introduced to resolve the shortage of funds after investment and increase corporate value. Startups that find it difficult to verify their business models due to operating losses have had difficulty obtaining direct loans from financial institutions and have received support through Kibo's Venture Investment-Linked Guarantee.

Considering the recent high inflation, high interest rates, high exchange rates, and difficulties in investment recovery through initial public offerings (IPO), which have caused funding shortages for startups and a continued investment winter, Kibo decided to reflect various preferential conditions in the existing Venture Investment-Linked Guarantee. The improved Venture Investment-Linked Guarantee targets unlisted small and medium-sized enterprises within 7 years of establishment that have attracted investments of 500 million KRW or more from venture investment institutions, and applies preferential measures such as ▲increased guarantee ratio (85→100%) ▲fixed guarantee fee rate of 1% ▲additional 0.2 percentage point reduction in guarantee fees for companies located in provincial areas, recently funded companies, and companies with high final corporate value. This preferential measure does not impose a time limit such as 'within a few years after investment attraction,' so innovative companies that were previously in the blind spot of the Venture Investment-Linked Guarantee are expected to benefit from the guarantee.

The VC Venture Fund Special Guarantee is a special guarantee program that supports the rapid formation of funds by small and medium enterprise startup investment companies and VCs, providing full guarantee support for capital contributions. Kibo plans to change the support period for the VC Venture Fund Special Guarantee from the existing public offering method to a permanent system and expand the target to VCs selected for the Mother Fund's occasional capital contribution projects, thereby inducing rapid fund formation and contributing to the activation of venture investment.

Kibo plans to supply a total of 150 billion KRW of venture capital in the second half of this year through Venture Investment-Linked Guarantees, VC Venture Fund Special Guarantees, and other means to fill the funding gap for startups and maintain growth momentum while actively supplementing the investment market. Kim Jong-ho, Chairman of Kibo, said, "Kibo has expanded the supply of venture capital to startups through the introduction of investment-linked guarantees, and we will make further efforts to support investment in innovative and venture companies facing difficulties in financing and follow-up investment due to the recent complex economic crisis," adding, "By strengthening policy support for the activation of the private-led venture investment market, we will take the lead in realizing a complete venture ecosystem, which is a national agenda."