Korea is stepping up efforts to decentralize startup investment beyond Seoul. With the establishment of the Chungnam Venture Fund worth of ₩101.1 billion ($74 million), the government signals a stronger push to channel capital into non-metropolitan regions. Backed by both public and private investors, the fund aims to reach ₩150 billion ($110 million) over three years, supporting the competitiveness of startups in South Chungcheong Province.
Regional Mother Fund Established to Drive Chungnam’s Startup Growth
The Ministry of SMEs and Startups (MSS, Minister Han Seong-sook) has launched the Chungnam Corporate Growth Venture Fund, a ₩101.1 billion (approximately $74 million) vehicle designed to strengthen non-metropolitan startup investment in Korea.
The announcement was made on August 20 at a ceremony in Cheonan, attended by MSS Vice Minister Noh Yong-seok and key local stakeholders. Notable attendees included Governor Kim Tae-heum, lawmaker Lee Jae-gwan (Cheonan, Democratic Party), Lee Dae-hee, CEO of Korea Venture Investment Corp., and executives from IBK, NH Nonghyup Bank, and Hana Bank.
The Chungnam fund is the nation’s first regional mother fund outside the metropolitan area with direct private sector participation. It was created after MSS’s February call for local governments to join in forming exclusive non-metropolitan funds.
Chungnam was selected alongside Gangwon, Gyeongbuk, and Busan, but became the first to complete fundraising.
Fund Structure: ₩101.1B Now, ₩150B in Three Years
The Chungnam Corporate Growth Venture Fund has been formed with ₩101.1 billion ($74 million) in total commitments, anchored by a record ₩60 billion ($44 million) contribution from the Fund of Funds (Mother Fund). Private and institutional investors added the remaining ₩50 billion ($36 million).
Key contributors include Chungcheongnam-do Province, Industrial Bank of Korea (IBK), Nonghyup Bank, and Hana Bank. Notably, local senior firms JB, Mirae N Sehae Energy, Sunic System, and Daeil Industries committed a combined ₩6 billion, signaling regional industry’s support for nurturing younger startups.
The fund’s operating committee will finalize investment areas in September, with sub-fund investments scheduled to begin in October. Over the next three years, the program aims to raise ₩150 billion ($110 million) in venture sub-funds, of which at least ₩60 billion ($44 million) will be allocated directly to startups and ventures based in Chungnam.
5 Economic Blocs, 3 Special Provinces: Korea’s Wider Regional Strategy
The Chungnam Venture Fund is part of Korea’s broader policy to decentralize startup investment under the “five major economic blocs and three special self-governing provinces” (5극 3특) framework.
This strategy establishes exclusive venture mother funds outside the Seoul metropolitan area, structured around:
- 5 Economic Blocs: Capital (Seoul), Central, Southeast, Daegu–Gyeongbuk, and Honam.
- 3 Special Self-Governing Provinces: Jeju, Gangwon, and Jeonbuk.
The Ministry of SMEs and Startps plans to use this model to expand Korean regional venture funds, ensuring that innovation capital flows to areas traditionally underserved by the investment community.
Long-Term Roadmap: Bay Valley and Beyond
Chungnam Province has tied the new fund to its vision of building “Bay Valley,” a regional hub positioned as a Korean counterpart to Silicon Valley. The province expects the fund to play a key role in accelerating the growth of startups that could scale into unicorns.
Governor Kim Tae-heum emphasized that the Chungnam Venture Fund is the first large-scale non-metropolitan mother fund and noted that with private capital joining government initiatives, “Chungnam can also produce unicorns.”
Looking ahead, Chungnam plans to double its total venture investment pool from ₩491.4 billion to ₩1 trillion ($735 million) by 2028. The province also intends to develop 1,300 startup spaces in Cheonan, Asan, and Yesan to strengthen infrastructure for founders.
Kim further stressed that Korea’s next growth phase depends on ventures and startups driving innovation in advanced technologies such as artificial intelligence (AI) — a role he framed as critical for overcoming structural challenges and sustaining long-term economic competitiveness,
“Korea has grown this far by overcoming the middle-income trap through constant innovation. From here, ventures and startups must take the lead in driving the next wave of growth.”
Regional Capital for Korea’s National Competitiveness
Ultimately, the Chungnam Venture Fund highlights how Korea is actively mobilizing regional venture capital as a growth engine for startups outside Seoul.
By combining government anchor funding with contributions from banks, local government, and established enterprises, the fund creates a model for sustainable investment for Korean startups in non-metropolitan regions.
Vice Minister Yong-seok Noh emphasized,
“The Chungnam Corporate Growth Venture Fund, created through regional solidarity, will inspire other communities and bring more investors into local ecosystems. Under the ‘5 Economic Blocs, 3 Special Provinces’ framework, MSS will continue to build non-metropolitan mother funds to grow startups as engines of regional development.”
For the Korean startup ecosystem, this initiative illustrates a key policy shift: leveraging regional funds to reinforce global competitiveness and ensuring that capital access extends beyond the metropolitan core.
By channeling investment into provinces like Chungnam, Korea is broadening its innovation map, enabling startups outside Seoul to scale, attract venture interest, and compete more actively in global markets.
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