Korean VC Sopoong closes $8M fund for startups focused on environmental impact • TechCrunch
South Korea presented a plan in 2012 to achieve carbon neutrality. But getting there is another story.
Although Korean manufacturers say they are trying to change their ways, the country’s GDP is linked to some uniquely pollutive industries, including petrochemical producers, automakers and shipbuilders. Although some businesses may not be sustainable in the long-term, there are still others. Venture firm Seoul claims that the emerging climate-tech startups can help large manufacturers make better decisions overall.
Sopoong is a socially-focused VC that aims to support eco-minded tech founders in South Korea, Southeast Asia and build a bridge between Korean conglomerates, startups and those in the sector. Sopoong has closed on around $8 million (10.3 billion won) for its latest, sixth fund, bringing the firm’s total assets under management to approximately $22 million (28 billion won).
I spoke with Sopoong chief executive Max Sang-Yeop Han, a serial entrepreneur who joined Sopoong in 2016 and acquired the firm in 2019, to learn about the VC’s plans.
Image credit: Sopoong Ventures/CEO Max Han
“It is a significant signal for large South Korean corporates participating as limited partners of environmental and climate tech-focused venture capitals like us,” Han said. “Participating LPs [Korean conglomerates] are passionate about climate technology and want to take part to address the climate and environment issue as they agree that the climate crisis is one of the urgent problems.”
Korean petroleum 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 strategic partners to Sopoong. Nonprofit organizations such as Asan Nanum Foundation, established by Hyundai Group, and D.Camp, as well as startup founders and executives, including the co-founder and former CEO of Krafton, Gang-Seok Kim, also joined Sopoong’s climate fund, Han continued.
After Han bought the firm in December 2019, the early-stage VC had already established five social impact funds and backed 81 startup founders since 2020. Sopoong was launched in 2008 by Jaewoong Lee, who co-founded South Korea’s largest internet portal operator Daum Communication, which merged with Kakao in 2014.
Han stated that while the VC firm now wants to focus on the climate crisis and other environmental problems through its sixth fund. Other tech sectors like SaaS, IT, and SaaS will also be on its radar. “Two-thirds of the fund will be invested in the environment and climate tech, including renewable energy, agritech and food tech, and the rest will go to the information technology industry investment,” Han said.
Its sweet spot are early-stage ventures in South Korea and Southeast Asia, from seed to Series B stages. Han explained to TechCrunch that while the average check size is $150,000 it can be as high as $600,000.
The sixth fund invested in 16 startups already, including MetaTexture (a plant-based food startup); Selex (an electric scooter-swapping startup based in Vietnam); Myorange (a platform to manage charitable donations); and Function 12, which automates coding and design 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 offers mentorship, coworking space and administrative support to each startup through its accelerator program. It also invests up $350,000 in each startup.
The accelerator was not the only program launched by Sopoong. It also created a fellowship program for six months to support climate tech entrepreneurship. So far, Sopoong says it has selected 13 individuals with master’s or doctoral degrees in environment-related majors, offering them $1,700 in grants per month and other support, including the accelerator program. Han stated that Sopoong may make a seed investment if the fellows succeed in starting a startup.