Is Equity-Financing Always Optimal for Innovative SMEs? --How ...

第 25 期with risks associated with such segments.Although it is too early to determine, I believe that the increasing of such fund of fundsto simply avail more financial resources alone would not create conditions sufficient for VCsto become the main figure in innovation financing as capable as Silicon Valley VCs.Silicon Valley is an unprecedented special area in which business ventures of specifictypes are crowded. Sufficient capital, diverse VCs with different sector-specific expertise,and plentiful supply of talented entrepreneurs are making self-reinforcing virtuous cyclepromoting U.S. as innovation leader. In that excellent ecosystem, talented people tend togather for the common purpose of great exit.The example of the Valley has been roman for many SME policymakers in Korea andfiscal policymakers as well. In Korea, there are many valleys named after it such as TeheranValley, where I first started my career at KOTEC, Guro Digital Valley, Daeduk Valley, etc.Even admitting that it is an ideal subject to pursue, we should not overlook the differentcondition, culture, and context. Silicon Valley has a long history of having both “abundantmoney-flow, large fractions from global savings glut 6transferred to U.S.” and “astronomicalexit value potential” for highly talented or lucky entrepreneurs.It is possible for VCs in Menlo Park to take higher risk for more start-ups because onesuccessful investment such as in CISCO or in Google would avail funds to be invested in“thousands” of other start-ups. By contrast, one successful investment would cover less thanten other risky investments in Korea. This is the reason that just increasing funding to VCs6 Global saving glut is a term coined by Ben Bernanke in 2005. The term describes a situation in which thereare worldwide too many savings with much less investment opportunities in the region where savings weregenerated. Thus, money flows into U.S. where more investment opportunities with diverse risk appetitesexist thanks to low currency risk of dollar, the seigniorage, high freedom and transparency.148