The evaluation criteria for confirming venture corporations will come closer to global standards.
Venture confirmation corporations can utilize special provisions under the Venture Business Act, as well as receive points and preferential conditions in various policy projects such as tax benefits, expanded guarantee limits from the Korea Technology Finance Corporation, and relaxed listing review criteria for the KOSDAQ.
The Ministry of SMEs and Startups announced on Dec. 1 that it will implement a revised guideline for confirming venture corporations.
According to the revision, in cases where ventures confirm investment from foreign investment companies that are not widely known in Korea, they will also be recognized as eligible investment achievements.
In the past, the requirements for investment entities to be recognized for overseas investment achievements were limited for venture applicants of the 'venture investment type.' This caused inconvenience as investment achievements from overseas emerging venture capital (VC) could not be immediately reflected.
From now on, foreign investment companies deemed to have international credibility and sufficient investment achievements by the Minister will also be immediately recognized as eligible investment entities. This will allow our venture system to respond swiftly to changes in the global VC market.
In particular, corporations seeking investment and listing opportunities based on networks with Korean venture capital active overseas, such as in Silicon Valley, are expected to have easier access to the venture corporation system.
In addition, when confirming venture corporations, the actual implementation of environmental, social, and governance (ESG) management will be explicitly evaluated.
In the past, venture applicants of the 'research and development type' and 'innovation growth type' had to undergo quantitative and qualitative evaluations of business growth, but existing finance-centered evaluation metrics could only indirectly assess non-financial achievements such as ESG management efforts.
In the future, the appropriateness of introducing ESG management will be officially qualitatively evaluated based on 14 detailed evaluation criteria, including environment (E), society (S), and governance (G). The evaluation factors will be planned to operate in a way that provides additional points so as not to burden early-stage venture corporations.
Kim Bong-deok, the Ministerial-level official for venture policy at the Ministry of SMEs and Startups, noted, "There is a need to be more sensitive to changes in the global venture ecosystem," adding, "We will continue to work for the sustainable growth of South Korean venture corporations and the enhancement of their global status."