By Baek Byung-yeul
LG Electronics and Mirae Asset Group said Friday they have agreed to create a fund to invest in promising startups both at home and abroad as part of their efforts to find new business opportunities.
The two companies held a signing ceremony in Seoul, Thursday, participated in by LG Electronics Chief Strategy Officer (CSO) Cho Ju-wan and Lee Man-hee, head of Mirae Asset Capital.
Under the agreement, LG Electronics and Mirae Asset Capital will each invest 50 billion won ($45 million) to establish a 100 billion won fund. Mirae Asset Group will raise its 50 billion won from its affiliates, including Mirae Asset Capital and Mirae Asset Securities. Mirae Asset Capital will manage the fund over the next 10 years.
“To respond swiftly to the rapidly-changing market environment, the two sides plan to make strategic investments in venture companies in emerging sectors such as electric vehicle ecosystems, digital healthcare and data-related businesses,” LG Electronics said. “The fund’s goal is to find growth engines for the future, while exploring open innovation between large companies and venture companies.”
The move is in line with efforts to actively cooperate with businesses, universities and research labs boasting competitive edges in various areas, the company added. LG Electronics recently announced its withdrawal from the smartphone business and has been actively seeking new opportunities.
In January, LG acquired Silicon Valley-based startup Alphonso to improve its competitiveness in television software. Established in 2012, Alphonso is a TV data analysis startup. With its artificial intelligence (AI) technology-based image analysis software, Alphonso possesses TV viewing data on 15 million households in North America.
Mirae Asset Group also has invested in prominent overseas startups such as Grab, a ride-hailing giant in South Asia.
They expect the fund to contribute to revitalizing the business ecosystem of venture companies. “We will focus our capabilities on core businesses that can secure competitive advantages through choice and concentration, and at the same time accelerate our preparation for new businesses for future growth,” the LG CSO said.