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Samsung expands start-up focus with new Silicon Valley seed fund

6 Feb 2013

growth-seedling_sqSouth Korean electronics giant Samsung has launched a Silicon Valley seed fund that will secure it a closer alignment to early-stage start-ups, working alongside its established corporate venturing arm.

As part of the launch of its Samsung Strategy and Innovation Center, Samsung has allocated $1bn to the Samsung Ventures America Fund, aimed at fuelling innovative technologies and business models, and a further $100m to the Samsung Catalyst Fund.

The move was announced at an event in Menlo Park in the heart of Silicon Valley opening the research hub with initial areas of focus including energy storage, remote computing, cyber security and mobile privacy.

It mirrors a similar emphasis placed on corporate venturing by a number of its competitors as traditional venture firms continue to struggle to raise cash to support innovation.

Last month, General Electric coordinated its venturing activities by establishing a central hub, also in Menlo Park, with the parent group giving it a $150m annual spend.

The innovation centre will also have hubs in Israel and Korea but will be headquartered out of where countless technology giants including Facebook have been born.

According to a report in, other areas of focus will be the internet of things, cloud infrastructure and mobile health.

Kickstarting its activities will be a SamsungCreate Challenge, through which it will invest up to $10m as seed investments to budding entrepreneurs.

The company already has an active corporate venturing arm headquartered out of South Korea and last year it invested in Voltaix through this, which is a provider of materials for the cleantech sector based in its domestic market.

It also formed a joint partnership agreement with US clean generation project developer Lincoln Renewable Energy to advance its green power portfolio.

Together the companies have formed a 50/50 joint venture business named Monument Power.

A recent report by management consultancy firm BCG found that Google Ventures was the top investor in venture-backed companies in the third quarter of 2012, underling how influential corporates now are in the venture space.

It said that while corporate venturing was ‘once an experiment’ but has now entered a new, more mature phase.

Others bolstering their clean technology investment arms of late include SanDisk, which launched with $75m to spend and began its investment activities by backing data storage company Whiptail.

In addition, Richard Lewis, principle at British Gas Venture Capital, recently told NewNet that it plans to spend £60m on the cleantech and energy sectors.

Samsung is also said to be open to M&A opportunities and strategic alliances, said.

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