A Comparative Study of Korean and Japanese Venture Capital Firms

Using data from Thomson One (also known as VentureXpert), we comparatively describe and analyze the investments of venture capital (VC) firms in Korea and Japan over the period 2003-2014. In both countries, three types of VC firms are prominent: private equity, corporate-affiliated, and bank-affiliated VC firms. The median investment amount of Korean VC firms is relatively small in comparison to Japanese VC firms. Korean VC firms invest less in expansion-stage firms but more in seed-stage firms than Japanese VC firms do, whereas Japanese VC firms tend to assign the largest proportion of their capital to expansion-stage investments. Lastly, Korean VC firms use IPOs as their primary exit method but they rarely use acquisition exits; by contrast, Japanese VC firms choose acquisition exits frequently.