Private Capital Reaches 763.2 Billion Won... First Science and Technology Innovation Fund Launched

Full-scale investment in strategic technology companies such as semiconductors and AI... Gradual expansion toward a 1 trillion won scale

The first Science and Technology Innovation Fund, totaling 763.2 billion won and created entirely with private capital without any government contributions, has begun full-scale operations. It is a privately led, science and technology-focused fund that concentrates investment in national strategic technology sectors such as semiconductors, artificial intelligence (AI), and quantum technologies.

On the 24th, the Ministry of Science and ICT held a launch ceremony and investor relations (IR) session for the first Science and Technology Innovation Fund at the TP Tower in Yeouido, Seoul, officially marking the start of investments.

Bae Gyeonghun, Deputy Prime Minister and Minister of Science and ICT. Provided by Yonhap News.

The Science and Technology Innovation Fund is a science and technology-focused fund that is created on a scale of around 1 trillion won, led by the private sector without direct government contributions. Shinhan Bank, IBK Industrial Bank of Korea, and Woori Bank, which serve as the dedicated banks for the Integrated Research Fund Management System (Integrated Ezbaro) that deposits and manages national research and development (R&D) funds, will create a 494 billion won master fund over four years. Based on this, sub-funds will be formed by matching private capital. Approximately 120 billion won will be contributed annually, and the government plans to gradually expand the program up to the fourth fund through additional formations each year.

More than triple the target amount... Private capital responds to the growth potential of strategic technologies

The Ministry of Science and ICT analyzed market trends and policy demand and selected five out of the twelve national strategic technologies as the key investment areas for the first fund. Through a public selection of management companies, sub-funds totaling 763.2 billion won were formed, including 401 billion won for semiconductors and displays, 144 billion won for artificial intelligence (AI), 49 billion won for advanced mobility, 107.6 billion won for advanced biotechnology, and 61.6 billion won for quantum technologies.

This is roughly three times the initial target formation amount of 255.9 billion won. The Ministry of Science and ICT explained that this reflects the private capital market’s strong assessment of the growth potential of domestic strategic technology companies.

Each sub-fund must invest at least 30-40% of its target formation amount (and at least 15-20% of any excess over the target) in companies within its key sector. It is also required to invest at least 60% (and at least 40% of any excess over the target) in companies across the twelve national strategic technology areas, including the key sectors.

The event was divided into a morning "IR & Matching Day" and an afternoon "Fund Launch Ceremony." During the morning session, companies seeking investment presented their business status to the sub-fund managers and held investment consultations. The afternoon launch ceremony was attended by Deputy Prime Minister Bae Kyunghoon, the heads of the dedicated banks, and the chief executives of the master and sub-fund management companies, who celebrated the launch of the first fund and shared future management plans.

Deputy Prime Minister Bae Kyunghoon said, "With the successful formation of the Science and Technology Innovation Fund, we have laid an important foundation for supporting companies in national strategic technology sectors," adding, "We will continue to expand private investment incentives and improve the support environment so that companies with excellent technological capabilities can grow."