South Korea’s largest steelmaker Posco said Tuesday it plans to invest 1 trillion won ($838 million) to nurture promising domestic startups.

The core aim of the project is to establish an industrial complex, called Venture Valley, for startups that will aid firms in research and development. It will also launch a startup fund, called Venture Fund, to help a slew of firms in association with the Ministry of SMEs and Startups and the Korean Venture Capital Association.

Some 200 billion won will be invested in the industrial complex and the remainder will be used for the fund. 

“The best way to drive future growth is to discover innovative ideas and commercialize them,” said CEO Choi Jeong-woo as he announced the firm’s investment plans during its event called Idea Market Place at Posco Center in Seoul.

The Idea Market Place will host 16 startups selected by Posco to exhibit their prototypes and present their business plans in diverse areas of bio, medicine, machine, materials and electronics.

“Through the fund, we will build a virtuous circle of platforms to boost the nation’s startup ecosystem and job creation,” Choi said.

SMEs and Startups Minister Park Young-sun, who attended the event, said, “Through Idea Market Place and the startup fund, we will also make efforts (together with Posco) to foster promising startups.”

The steelmaker plans to invest 200 billion won over the next four years in Venture Valley to build infrastructure such as Pohang Incubating Center, Gwangyang Knowledge Industry Center and data centers.

The firm aims to make Pohang and Gwangyang cities as a base for R&D of new startups. The businesses include materials, energy and environment based on third-generation accelerators, development of bio and new medicine based on fourth-generation accelerators and the formation of smart cities and factories.

Posco plans to form the startup fund with an investment of 2 trillion won -- 800 billion won from Posco and 1.2 trillion won from outside investors -- from 2019 to 2024. 

By Shin Ji-hye and Jung Min-kyung
(shinjh@heraldcorp.com) (mkjung@heraldcorp.com)