The Ministry of SMEs and Startups (MSS) and Korea Venture Investment Corporation said on the 23rd that they held an inaugural ceremony for the "venture investment contract culture development forum" to establish a fair venture investment contract culture.
As legal disputes and unfair contract cases between venture capital (VC) investors and startups receiving investment have recently been raised, the industry called for a discussion body to diagnose the issues and seek improvements on its own.
The venture investment contract culture development forum brings together startups, VCs, legal experts, and related organizations—members of the venture ecosystem—to discuss difficulties arising in the field during contracting and to seek solutions. The government plans to review and identify tasks for institutional improvement based on opinions from the forum.
At the inaugural ceremony, in addition to the Ministry of SMEs and Startups (MSS) and Korea Venture Investment Corporation, which oversee the forum's operations, major related organizations and private experts attended, including the Korea Venture Business Association, Korea Startup Forum, Korea Venture Capital Association, Korea Startup Accelerators and Early Stage Investors Association (K-AIA), and the Korea Business Angels Association.
The forum will, through regular meetings, carry out tasks such as: ▲ hearing on-site opinions about unfair investment contracts and practices ▲ analyzing causes of conflict between investors and investee companies and discussing solutions ▲ identifying institutional improvement tasks to foster a sound venture investment ecosystem.
A plan was also announced to build an "on-site expert pool (Pool)" that will power the forum going forward. The Ministry of SMEs and Startups (MSS) and Korea Venture Investment Corporation will receive recommendations from each association and related organization for VCs, ACs, and startup CEOs with extensive field experience and form groups by field and stage. Through this, they plan to systematically gather real-world problems and improvement ideas arising at actual contracting sites.
Gwak Jae-kyung, head of the investment management and supervision division, said, "We expect this forum to become a practical discussion body that helps investors and startups understand each other's positions and find a 'solution' for growing together," adding, "As the venture investment market grows in scale, we will work with members of the venture investment ecosystem to identify actionable tasks and build a mutually beneficial investment culture."