LG Electronics boosts fund for global startup investment to $100 million

[Courtesy of LG Electronics]

LG Electronics Inc. is significantly expanding its global startup investment fund to $100 million from the existing $20 million, seen as a strategic move to seize excellent technology company shares at low prices during a period of significant investment.

According to industry sources on the Thursday, LG North American Innovation Center (NOVA), LG Electronics’ center in Silicon Valley, is expanding its investment fund to $100 million ahead of the global startup-focused new business idea competition called Mission for the Future.

In addition to the fund’s expansion, the company is also broadening its operational approach by moving away from LG Electronics’ previous practice of solely investing and seeking collaboration with external venture capital and investment firms. It has been reported that LG NOVA is in discussions with several venture capital and investment firms with extensive experience in startup investments in Silicon Valley.

Established in 2020, LG NOVA was created by LG Electronics to discover new business models and strengthen collaborations with innovative startups in Silicon Valley. It is led by Rhee Sok-woo, former deputy director of the U.S. National Institute of Standards and Technology, who specializes in the Internet of Things (IoT) field.

Startup investments have been significantly affected following the bankruptcy of Silicon Valley Bank in March. In contrast to this investment downturn, LG NOVA’s increase in investment size can be seen as a move to prepare for the future, such as securing future technology dominance, promoting new businesses and discovering innovative ideas.

During times when there was abundant liquidity in the market, the value of stakes in exceptional startups skyrocketed. However, during the current investment downturn, it is relatively easier to invest in startups. LG NOVA manages the global startup investment fund with a focus on securing new businesses and enhancing its business portfolio rather than seeking short-term profits.

Expanding LG NOVA’s global startup investment fund to include venture capital and investment firms is also expected to have positive effects. This is because it will allow LG NOVA to gain expertise in identifying the latest global technology trends and discovering and nurturing innovative companies.

Since 2021, LG NOVA has been conducting the Mission for the Future competition annually to obtain new business ideas from global startups. The $20 million fund established by LG NOVA at its launch has been invested in healthcare, climate technology, mobility, connected homes, metaverse, and other startup companies in the competition held in 2021-2022 and 2022-2023.

Considering LG NOVA’s role as a driving force for LG Electronics’ new business expansion, it is expected that its presence will grow along with the expansion of the fund size.