Korea's first public-interest impact investment firm… Pursuing a balance between social value and profitability.
– A step-by-step evaluation system centered on primary impact and secondary financial performance.
Asia accounts for only 1-2% of global impact investing. The Korea Social Investment Foundation is leading the expansion of the Asian impact market.
Venture capital is "adventure capital" that identifies and invests capital in companies with high growth potential. While most venture capital firms focus on maximizing profits, some pursue both public good and financial growth. Korea's first public-interest impact investment firm, the Korea Social Investment Foundation, is a leading impact investment organization in Korea. Since its establishment in 2012, it has accumulated KRW 72.2 billion in impact investments and supported 1,405 companies, including both financial and non-financial companies (as of May 2025). To learn more about the Korea Social Investment Foundation's commitment to solving social issues and achieving corporate growth simultaneously, we interviewed Chairman Lee Jong-ik of the Korea Social Investment Foundation.
■ Prioritizing impact, securing profitability
What most distinguishes the KOREA SOCIAL INVESTMENT FOUNDATION from other investment firms is its focus on impact investing. Impact investing goes beyond the pursuit of financial returns, investing in companies that address social and environmental issues while simultaneously creating economic value. While still a relatively new concept in Asia, it has already become a major investment trend in the global asset management market (AUM).
In the US, approximately 37% of total assets are invested in impact investing, and in Europe, 55%. However, in Asia, including Korea, the figure is only 1-2%. Unlike the West, where impact investing has already become a mainstream market, Korea is only just entering a period of growth. Accordingly, the Korea Social Investment Foundation aims to lay the foundation for the domestic impact investment ecosystem and grow into a leading impact investment hub in Asia.
Impact investing differs structurally from traditional venture capital. While traditional venture capitalists prioritize maximizing financial returns and consider social value as a secondary consideration, impact investing prioritizes "social and environmental value" as the starting point for investment decisions. In other words, when selecting companies for investment, impact investing primarily assesses their commitment to solving social problems and their potential to create impact. Chairman Lee Jong-ik stated, "All the companies we invest in have clearly defined impact. We prioritize companies that fit the impact category and assess their potential to create social value first. No matter how excellent a company's financial performance, if it lacks impact, it is naturally excluded from our investment pool."
So, can a venture company receive investment from the Korea Social Investment Foundation solely based on its potential to create social value? Chairman Lee Jong-ik said no. "We first assess impact, and if it passes the screening, we scrutinize marketability, profitability, team, and technology even more thoroughly than for-profit venture capital firms. If a company fails to generate profits, it will ultimately be eliminated, and at that point, its impact will disappear. Therefore, we scrutinize a company's growth potential and market competitiveness even more rigorously than for-profit venture capital firms," he said.
After passing the initial assessment, the Impact Gateway, a more rigorous quantitative and qualitative evaluation is conducted than at typical venture capital firms. The Korea Social Investment Foundation focuses on companies that not only do "good work," but also have a growth foundation capable of sustaining long-term impact.
■ The Success Equation for Impact Investing
The KOREA SOCIAL INVESTMENT FOUNDATION's preferred companies can be summarized in two key elements: "clear impact" and "sustainable financial performance." Only by achieving a balance between these two elements can social value and economic growth be achieved simultaneously. Chairman Lee Jong-ik introduced WorksMate and SeedN as examples that exemplify this philosophy.
WorksMate is a construction workforce matching platform that connects day laborers and construction sites online. Currently, approximately one million short-term construction workers are finding jobs through this platform in a safe and transparent manner. This service focuses on connecting job seekers and employers, and has established an "alternative credit rating system" based on data on workers' work history and diligence. This system allows construction workers to receive credit ratings and, through alternative credit ratings, connect with financial and insurance options. WorksMate has been recognized as a leading impact business model that simultaneously addresses social issues and achieves financial success.
SeedN provides AI and IoT-based energy efficiency solutions. The company possesses smart air conditioning management technology that optimizes heating and cooling systems in large indoor spaces such as stores, offices, and factories. Small leaf sensors are installed on walls to collect real-time temperature, humidity, and light data, and AI logic automatically controls air conditioning equipment to minimize energy waste. Companies that have adopted this technology have achieved an average reduction of more than 50% in energy consumption and carbon emissions. SeedN has achieved both the environmental impact of energy savings and the financial benefits of cost savings.
What these two companies have in common is that they are structured to address social issues while also achieving self-growth. Through sustainable business models, they simultaneously achieve social value and economic performance. Chairman Lee stated, "Impact and profit are not mutually exclusive. True impact is achieved through a sustainable business model." He added, "The Korea Social Investment Foundation will continue to discover innovative startups that share this philosophy and support their growth throughout their journey."
■ ESG, growth, and global expansion
The Korea Social Investment Foundation operates various support programs that connect impact with financial performance and help companies become self-reliant in the market. A prime example is "ESG Plus." It provides a self-diagnosis service to startups so they can assess their ESG management practices. Through on-site inspections and interviews with experts, it suggests specific areas for improvement. Furthermore, after consulting, it issues an ESG management evaluation report, which companies can use as a reference when developing future strategies and attracting investment. Chairman Lee added, "In today's market, ESG values are already becoming a guiding principle for consumers. Companies that pursue short-term profits or manufacture products in unethical ways can never achieve sustainable growth. ESG is now a corporate brand strategy and survival strategy."
The KOREA SOCIAL INVESTMENT FOUNDATION also operates a "Self-Designed Acceleration" program, which allows companies to design the support they need at each stage of their growth, thereby fostering the practical growth of startups. Companies can choose their own areas of expertise, including finance, legal affairs, investment attraction, and global expansion, and receive expert mentoring and practical advice. Furthermore, the "Global Impact Expansion Support Program" supports expansion into global markets such as Vietnam, Indonesia, and Cambodia through market research, partner matching, and overseas investor networking. Thus, the KOREA SOCIAL INVESTMENT FOUNDATION goes beyond investment; it also serves as a partner, empowering companies to cultivate their own growth and achieve sustainable results.
Applications to the KOREA SOCIAL INVESTMENT FOUNDATION are accepted year-round through the official website. Startups submit a company profile or investor relations materials, which are reviewed by an internal screening team before a meeting is scheduled. Furthermore, the KOREA SOCIAL INVESTMENT FOUNDATION regularly selects promising impact startups through its annual "Impact Future" placement program. This program provides comprehensive support for all aspects of startup growth, including investment, mentoring, ESG assessments, and investor relations pitching.
■ A Pioneer in Impact Investing, Becoming the Center of Asia
The KOREA SOCIAL INVESTMENT FOUNDATION's fund differs from typical venture funds in several ways. Donors' contributions are labeled with specific purposes. For example, donations for "climate improvement" are used only for funds or programs in that specific area. Chairman Lee stated, "The KOREA SOCIAL INVESTMENT FOUNDATION is a public institution and a non-profit public interest corporation. As an independent private non-profit organization, not affiliated with a large corporation or financial institution, we have the foundation to fulfill this role. Therefore, the KOREA SOCIAL INVESTMENT FOUNDATION has the potential to grow into a 'Fund of Funds' that gathers and manages impact capital." He also emphasized, "While the KOREA SOCIAL INVESTMENT FOUNDATION is a public interest corporation, its investment and management capabilities are comparable to those of any private venture capital firm. By collaborating through joint fund creation and joint investment, we can achieve greater social impact."
Finally, Chairman Lee stated, "I hope venture companies committed to solving social problems will clearly define their impact and take on more challenges with the KOREA SOCIAL INVESTMENT FOUNDATION." While impact investing has already become a mainstream market in the West, it's still in its infancy in Asia. Going forward, with the KOREA SOCIAL INVESTMENT FOUNDATION at the center, the Asian impact investment market is expected to expand significantly, leading to positive social change.
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