We would like to share the paradigm shift in the venture investment ecosystem following the Ministry of SMEs and Startups (MSS) announcement of the amendments to the "Standard Venture Investment Agreement and Guidebook." The core of this amendment lies in ensuring balance and rationality among stakeholders.

The previously complex structure of 32 different types of contracts has been simplified and separated into the Share Purchase Agreement (SPA) and the Shareholders' Agreement (SHA). In addition, the requirement for unanimous consent from all investors has been improved to a "collective consent method by investment round," reducing the risk of delayed decision-making. Furthermore, moving away from the conventional practice focused on Redeemable Convertible Preferred Stock (RCPS), the amendment presents a global standard centered on Convertible Preferred Stock (CPS). The refixing method, which used to cause excessive dilution of shares, has also been shifted to a "weighted average method." Concurrently, the mandatory IPO requirement has been eased to a "best-effort obligation," and unfair third-party joint liabilities have been restricted, easing the management burden on founders.

This amendment to the standard agreement is projected to serve as an opportunity to strengthen the financial soundness of startups' financial statements and rationalize valuation adjustments. Detailed information regarding this amendment can be found through the link below.