A South Korean government- backed fund manager and Singapore-based Adval Capital have pledged US$40 million (S$56.9 million) in total to a new investment fund to help small and medium-sized enterprises and start-ups in both nations expand overseas.

The new fund, involving fund-of-fund manager Korea Venture Investment Corporation (KVIC), is the third to be set up by the two fund managers in five months. The first was a US$10 million fund focusing on Asian start-ups that are creating, distributing or using digital content.

The fund has since invested between US$300,000 and $450,000 each in four Korean start-ups keen to expand into the Asean market. A Singapore contents-oriented company venturing into South Korea is also expected to be funded.

The second fund of US$10 million will invest in technology or cultural start-ups.

"(This is) a great opportunity for Singapore to attract more capital and draw more Korean companies to use Singapore as a base for expansion" into South-east Asia, said Adval Capital co-founder Patsy Ong.

KVIC also announced the opening of its Singapore branch, its third overseas office after San Francisco and Shanghai, at a ceremony yesterday. "Korean start-ups have excellent technical competencies, but they lack marketing expertise in global markets," said Mr Han Jungwha, administrator of South Korea's Small and Medium Business Administration, the government agency that oversees KVIC.

"We hope that they can use the network here (in Singapore) to go global," he added.