Daejeon launches $39.9M fund of funds to back local startups

What's the deal? Daejeon has launched the Daejeon D-Growth FundDealroom has a profile for this one. Try Dealroom →, a US$45.5M fund of funds, to back early-stage startups and strategic industries across the South Korean city. It held a launch ceremony on October 1 at Daejeon Startup Park, attended by about 100 people.

Who's backing it? The fund took shape after the city won the Ministry of SMEs and Startups'Dealroom has a profile for this one. Try Dealroom → regional growth fund competition. The government's fund of funds seeded US$29.3M, with KAISTDealroom has a profile for this one. Try Dealroom →, Hana BankDealroom has a profile for this one. Try Dealroom →, NH NongHyup BankDealroom has a profile for this one. Try Dealroom →, Industrial Bank of KoreaDealroom has a profile for this one. Try Dealroom →, and local companies adding the rest. Korea Venture Investment Corp. will manage it.

What's the endgame? The fund targets Daejeon's five strategic industries: defence — including robotics and drones — semiconductors, bio, artificial intelligence, and quantum technology. The city plans to form sub-funds worth more than US$65.4M, drawing in venture capital firms from the Seoul area and local accelerators.

Why now? The ministry's program is designed to spread venture investment beyond the Seoul metropolitan area. By linking the new fund with the US$171.7M Daejeon D-Leap FundDealroom has a profile for this one. Try Dealroom → created in January, the city says it has completed a full-cycle system supplying capital from early startup to scaleup.

"The Daejeon D-Growth Fund will drive corporate growth and regional investment activity, and build a virtuous cycle leading to job creation and vitality in the local economy," Mayor Huh Tae-jung said.

The signal: The launch is part of a broader push to channel South Korea's university and government research — including KAIST's — into venture investment outside the capital, concentrating public capital in defence, semiconductors, and AI.

Read more: en.sedaily.com

Image credit: Luke Hoagland