Two years ago, South Korea unveiled a plan to reach carbon neutrality by 2050. Getting there will be another story.
AAlthough Korean manufacturers say they are trying to change their ways, the country’s GDP is tied to some exceptionally polluting industries, including petrochemical producers, automakers and shipbuilders. While some businesses may never be truly sustainable, one venture company in Seoul argues that new climate-tech startups will help big manufacturers improve overall.
Sopoong, a VC focused on social impact, intends to support environmentally-minded tech founders in South Korea and Southeast Asia, while building a bridge between Korean conglomerates and startups in the sector. Sopoong has closed around $8 million (10.3 billion won) for its latest sixth fund, bringing the company’s total assets under management to approximately $22 million (28 billion won).
I spoke with Sopoong CEO Max Sang-Yeop Han, a serial entrepreneur who joined Sopoong in 2016 and acquired the company in 2019, to learn about VC’s plans.
“It is an important signal for large South Korean corporations participating as climate and environmental technology-focused venture capital limited partners like us,” Han said. “Participating LPs [Korean conglomerates] They are passionate about climate technology and want to get involved in tackling the climate and environment issue as they agree that the climate crisis is one of the urgent issues.”
Korean oil refining company GS Holdings and chemical company Isu participated in Sopoong’s climate-focused fund as limited partners, Han said, adding that they will be more like Sopoong’s strategic partners. Non-profit organizations such as the Asan Nanum Foundation, established by Hyundai Group, and D.Camp, as well as startup founders and executives, including Krafton co-founder and former CEO Gang-Seok Kim, also joined the climate fund. Sopoong, Han continued.
The early-stage VC had already established five social impact funds and backed 81 startups since 2020, after the company was acquired by Han in December 2019. Sopoong was launched in 2008 by Jaewoong Lee, who co-founded the internet portal operator South Korea’s largest, Daum Communication. , which merged with Kakao in 2014.
Now the venture capital firm wants to focus on the climate crisis and other environmental issues through its sixth fund, but other technology sectors like SaaS and IT will continue to be on its radar, according to Han. “Two-thirds of the fund will be invested in environmental and climate technology, including renewable energy, agricultural technology and food technology, with the rest going to investment in the information technology industry,” Han said.
His sweet spot is early-stage companies, from the seed to the Serie A stages in South Korea and Southeast Asia. The average size of their check is $150,000, but the company can go as high as $600,000, Han told TechCrunch.
The sixth fund has already invested in 16 startups, including MetaTexture, a plant-based food startup; Selex, a Vietnam-based electric scooter and battery swapping technology startup; Myorange, a platform for managing charitable donations; and Function 12, an automation tool that helps users complete coding and layout files.
Nine of the 16 portfolio companies are participating in Sopoong’s first accelerator program, which launched in June and runs for six months. Sopoong invests up to $350,000 in each startup through the accelerator program and offers mentorship, co-working space, administrative support and expert networking opportunities.
In addition to the accelerator, the company also launched a six-month fellowship program to foster entrepreneurship in climate technology. So far, Sopoong says it has selected 13 people with master’s or doctoral degrees in environmental-related specializations, offering them $1,700 in grants per month and other support, including the accelerator program. If the participating fellows succeed in founding a new company, Sopoong could make an initial investment, Han said.