Naver (NAVER) has liquidated a fund it initially contributed 5 billion won to activate the domestic mobile game ecosystem after 12 years. Although the internal rate of return (IRR) approached an annual 20%, the fund failed to significantly contribute to the growth of the domestic game ecosystem as originally intended, leading to evaluations of it being only "half a success."
According to industry sources on the 14th, the 'Naver Korea Investment, Cheer Up! Game People Fund' (hereinafter referred to as the Game People Fund) was liquidated in late July with an IRR of 19.7%. Naver is confirmed to have recovered a cumulative total of approximately 14.8 billion won.
The Game People Fund was launched in 2014 with a total size of 10 billion won, with Naver contributing 5 billion won and Korea Investment Partners along with first-generation game industry figures such as Namgung Hoon each contributing 2.5 billion won. According to Naver's business reports from 2014 to 2025, Naver recovered a total of 14.8 billion won through this fund: 5 billion won in 2018, 2.1 billion won in 2020, 9.7 billion won in 2021, and 2.5 billion won in 2023. The liquidation took 12 years due to delays in recovering remaining portfolio assets such as the Vietnamese game publishing company 'Appota'.
IRR is a rate of return calculated by compounding backward from the timing and amount of capital contributions and recoveries until it equals the principal. For example, if 1 million won is invested and returns 600,000 won after one year and 720,000 won after two years, the IRR is an annual 20%. Calculating backward at a 20% return rate, 600,000 won becomes 500,000 won (600,000/1.2), and 720,000 won becomes 500,000 won after two iterations (720,000/1.2/1.2), totaling the original principal of 1 million won.
The investment in global social casino game company Huuuge proved highly effective. Korea Investment Partners participated exclusively with a 2 billion won round in Huuuge's Series A funding, and upon its listing on the Polish stock exchange in 2021, successfully recovered 30 billion won, representing a 15-fold return. Hyperconnect, known for the video chat app 'Azar', received a 5 billion won investment and yielded a six-fold return of 3.2 billion won. Hyperconnect was later acquired by Match Group, a NASDAQ-listed company.
Conversely, the fund failed to deliver on its original goal of fostering a domestic game startup ecosystem. It is reported that early in its formation, the Game People Fund invested initial capital ranging from 400 million won to 600 million won across four domestic game companies. Tracking these investments revealed that Oolblue was acquired by Neptune and later merged with Arc Bears to form Nimble Nerve, which currently develops and services 'Eternal Return'. NineM Interactive was absorbed into Netmarble F&C. Kokunbit was deemed liquidated (a status where corporate registration was neglected leading to administrative cancellation), and Eight Panda filed for bankruptcy. Neither Korea Investment Partners nor Naver disclosed details on other investments or their growth outcomes.
The game industry analyzed that since the late 2010s, the domestic game market has been restructured around MMORPGs (Massively Multiplayer Online Role-Playing Games), intensifying competition in development and marketing costs. While small-scale game companies with weak capital could compete on ideas alone during the early 2010s when the fund was established, the environment changed rapidly.
The likelihood of both companies forming a follow-up specialized game fund is low. Korea Investment Partners stated, "Additional fund formation will be difficult until the National Growth Fund (58 billion won scale) and Clinical Phase 3 Fund (20 billion won scale), scheduled to launch this year, are utilized at a certain ratio." Naver has expressed its commitment to fostering technology and startup ecosystems but has not disclosed any plans for a separate specialized game fund.
in TECH
