Mumbai: About a week ago, Korea Venture Investment Corporation (KVIC) and other stakeholders in their government met with at least five Indian venture capital funds in Bengaluru to understand the market's depth and opportunities as it looks to deepen its presence in the country.
The funds were Exfinity Venture Partners, 3one4 Capital, Speciale Invest, Iron Pillar and Trident Growth Partners, people familiar with the matter said. Korea’s IMM Investment Corp was part of the conversations.
KVIC is looking to tie up with funds under its Foreign VC Global Fund, which has $100 million to invest exclusively in offshore venture capital funds. However, KVIC’s commitment is qualified—Indian VC funds must invest at least an equivalent amount in Korean companies.
Barring the Indian arms of South Korean funds Mirae Asset Venture Investments and IMM, few Indian VCs would qualify for an investment from KVIC because they lack direct exposure to Korea. The discussions were aimed at understanding the synergies between the two markets and the sectors that KVIC could back in India.
The meetings with Korean LPs come as Indian funds look to raise their next pool of capital from a wider and more diversified investor base. Trident, IMM and KVIC did not respond to Mint’s requests for comment. Other funds declined to comment on specific conversations with KVIC.
There has traditionally been very little Korean capital in India’s VC ecosystem, which is dominated by investors from the US, Europe, Singapore and West Asia.
“Korean institutional investors are increasingly viewing India not just as a consumer market, but as a deep technology production hub,” said Vishesh Rajaram, founding partner at Speciale Invest, a VC firm specializing in deeptech and frontier technology. “The sentiment has meaningfully shifted from cautious curiosity to structured due diligence.”
Strategic interest
As Korean institutional capital develops a more structured India allocation strategy, early-stage funds like Speciale stand to benefit because they operate where Korean industrial and institutional investors have genuine strategic interest, he said.
Iron Pillar is in discussions with Korean institutions and sees growing interest from “the next wave of Korean investors,” managing partner Anand Prasanna said. Its second fund already counts a South Korean financial institution among its limited partners.
Earlier in June, Iron Pillar and Seoul-based Paramark Ventures invested in Orange Labs’ $30 million round. Paramark has invested in Indian startups such as Cashify and Purplle.
Industry executives pointed to areas such as space, semiconductors, defence-tech, advanced materials, robotics, consumer, commerce and clean energy that have drawn Korean investors looking to diversify supply chains away from China.
“Over the last year, there has been a spurt of interest as Koreans are actively evaluating partnerships with Indian funds with a good track record, niche sectoral exposure and the capability to build companies across borders,” Exfinity Venture’s managing partner Chinnu Senthilkumar said.
At least half a dozen of Exfinity’s portfolio companies including Maieutic Semiconductor, Chara Technologies, which builds rare earth-free motors, and CloudSEK are in talks with Korean players for tie-ups or investments. Senthilkumar added that the B2B-focused fund is targeting Korean investors for the first time as it sets out to raise ₹1,100 crore.
This diversification from China has created new opportunities for India, especially in AI and advanced manufacturing, as Korean and Japanese investors, many of whom have deep ecosystems at home, track how India’s industrial base evolves.
“Korean institutional investors, including pension funds, insurers and fund-of-funds platforms, are becoming more active… This pool of capital is gaining prominence for many funds in the new cycle that were traditionally reliant on other global investors,” said Rohit Bhayana, co-chief executive and co-founder of Oister Global, a private markets asset manager that recently launched dedicated secondary funds. “As fundraising cycles become longer and more competitive, managers are increasingly looking at new pools of capital in Asia.”
He added that the firm is also in discussions with Korean LPs for its upcoming fund. Oister has backed Speciale Invest as a fund of fund in the past.
Foreign capital wave
The fresh optimism follows recent announcements and large fundraises that potentially underscore the next wave of foreign capital into the country.
On 18 June, the Indian Venture and Alternate Capital Association signed a pact with the Korea Venture Capital Association to strengthen collaboration. Earlier, National Pension Service of Korea invested in Kotak Alternate Asset Managers Ltd’s $1 billion real estate fund, marking the pension giant’s first investment in Indian alternative assets.
In April, South Korean tech companies Krafton Inc and Naver Corp launched a ₹6,000 crore India-focused fund to back early-growth-stage technology startups and roped in Mirae Asset Venture Investments India to manage it. Mirae has invested in startups including Zomato, Bigbasket and Snabbit.
Krafton, one of the most prolific investors in India, invested in Nodwin Gaming, one of its earliest bets in India, in 2021 and has expanded its portfolio to back Loco, Pratilipi, Kuku FM, Cashfree Payments and Nautilus Mobile.
Krafton, an investor in funds such as Lumikai and 3one4 Capital, was onboarded as an anchor investor for IMM Investment Corp’s maiden India vehicle in 2024, which invested in Indian startups Sugar Cosmetics, Servify and Shadowfax. In the same year, Korea Investment Corporation set up an office in Mumbai to establish its local presence in emerging markets.
In September, Elev8 Venture Partners closed a ₹1,400 crore ($160 million) maiden fund, targeting growth-stage startups in India. The fund was anchored by South Korea’s KB Investment and attracted capital from institutions in India and Hong Kong.
3one4’s Nruthya Madappa also indicated deeper interest from Korean investors in the Indian VC and startup ecosystem.
“Historically, Korean strategic and financial investors have entered India through small and contained commitments through partnerships first and then rapidly expanded their horizon in the country. Once there is evidence of early success in the market, they are keen to double-down and deepen their exposure,” she said.