Taiwan government to invest over $80M in four VC funds, including 500 Startups

On Friday, Taiwan’s National Development Council announced plans to invest US$83 million in four different venture capital firms, in hopes of spurring growth for the island’s startups.

The NDC will invest US$15 million in 500 Startups. It will also give US$12 million or match 30 percent of LP contributions to AppWorks‘ upcoming fund, and US$20 million or match 30 percent of Translink Capital III’s upcoming fund. In addition, the NDC will invest US$30 million in a joint venture fund run by the Battelle Memorial Institute’s 360ip and Taiwan’s Industrial Technology Investment Corporation. The NDC hasn’t set any specific stipulations dictating what portion of these funds must go to Taiwan startups.

500 Startups and AppWorks both have a history investing in early-stage Taiwanese companies. Throughout 2013 and 2014, 500 Startups provided seed funding to a number of teams, most of which made global-facing consumer apps. The company also appointed an entrepreneur-in-residence in Taiwan to help source deals.

AppWorks is best known as Taiwan’s homegrown accelerator program, modeled after Y Combinator. It also managed a US$10 million fund for domestic startups. I’s most high-profile investment to date is EZTable, a restaurant-booking app that recently disclosed it raised US$5.5 million from MediaTek and others.

Translink Capital III, according to the NDC, is a fund jointly-managed by Translink Capital and UMC. Through its other two venture funds Translink has invested in well-known California startups including Soundhound, Peel, Quixey, and Kamcord.

The announcement marks the latest development in the NDC’s HeadStart Taiwan Project. Approved in August 2014, the plan aims to help bolster the island’s startup ecosystem through deregulation, providing greater access to early-stage capital, and developing a startup cluster in Taipei Expo Park. Recently, Taiwan’s Ministry of Labor amended labor laws per the NDC’s suggestion that will allow foreigners in Taiwan to work for startups without first acquiring two years of related experience.

Editing by Steven Millward, top image by Alvin C. Chen