The government plans to invest 1 trillion won (US$998m) into fund of funds (FoFs) that will provide money to venture start up companies and help in the creation of new businesses, Minister of Finance and Economy Lee Hun-jai said.
Speaking at a general meeting of venture companies in Seoul, Lee said that the scheme is part of an ongoing effort to breathe life into the high-tech venture start up sector, which generated growth following the 1997-98 Asian financial crisis but has since fallen on hard times.
Problems during the so-called bursting of the venture bubble of 2002 were exacerbated by moral hazards of entrepreneurs and caused investors to stay clear of these businesses. Also cited for weak investment was the short life cycle of cutting-edge products, which raised investment risks.
