The Korean startup ecosystem has been a thriving force driving growth for the domestic economy with tech-led innovations. The Venture Capital firms invested in Korean startups have also reaped benefits, with record-high earnings and profits. The meteoric rise of Korean unicorn startups and the number of startup IPOs increasing in the past two years have brought significant revenues for the investing firms. VCs have seen their annual revenues surge as high as 80% year-on-year increase.
As per a recent report by state-owned Korea Development Bank, the amount of venture capital investments in South Korea in 2020 has reached a record high of $3.8 billion or 4.3 trillion won. Riding the wave, the Korea Development Bank is also planning to launch its venture capital firm in Silicon Valley, as per media reports.
According to a Korean Venture Capital Association report, an umbrella organization representing the Korean venture capital industry, VC firms have raised 630 billion won or $552 million in 2020 through successful startup IPOs. VC firms expect to achieve more growth as the Korean market is one of the most advanced markets technology-wise.
The global pandemic situation saw the emergence of more startups in Korea creating ‘untact’ solutions, and the VCs have shown keen interest in investing in future technologies. As per a media report, the total amount invested by VCs in startups during the first quarter of 2021 has been 2.24 trillion won or $1.99 billion, which is 50% up over last year.
Korean media ‘The Bell,’ that reports on the Capital Markets has prepared a list of ‘Venture capital league table 2020’ based on the ‘Assets under management (AUM), revealing top-performing VCs in Korea. It indicates that despite an economic slowdown, VCs have grown their AUMs and have put in their money in every sector – ICT, manufacturing, e-commerce, biotech, gaming, early-stage, expansion stage, and later stage. Market analysts believe the growth momentum for Korean VCs will continue in 2021 as well.
KoreaTechDesk lists some of the leading VC firms in Korea, who have taken high-stake risks and bold bets on the growing Korean startup ecosystem.
IMM Investment is an independent venture capital firm focused on investments in venture capital, mezzanine, and infrastructure. The VC firm has been investing in value portfolio companies and actively invests in various sectors, including ICT, consumer goods and services, life sciences, and healthcare. The VC’s investments span from early to late-stage and pre-IPO. It has been an early investor for five Unicorns. IMM Investment also has several Unicorn-to-be startups in Korea in its portfolio. IMM Investment was one of the early-stage investors of Coupang, the e-commerce startup which recently launched its IPO at NYSE. Besides, it has also invested in StyleShare, Woowa Brothers, Bluehole Studio, WeMakePrice, Cellitron, etc. IMM Investment’s AUM in 2020 was around $3.7 billion, including VC funds and equity funds.
Korea Investment Partners (KIP) is the largest venture capital firm in Korea. KIP is a member of Korea Investment Holdings. It is a Venture Capital firm investing in and promoting promising businesses’ growth for the past 30 years. KIP manages over 20 funds total size of over $2.8 billion. Every year, the firm invests in about 50 companies from Korea, China, and the US.
KIP portfolio has names like Kakao, Naver, YG Entertainment, Bodyfriend, Osstem Implant, Doubelu Games, and Didi Chuxing. KIP manages over 20 venture and private equity funds with US$1.8 billion in total assets under management. The company operates globally from its Seoul-based headquarters with offices in Shanghai, Beijing, and Sunnyvale. KIP’s revenue surged by 79% year-on-year in 2020.
Aju IB Investment is one of the top three VC firms in Korea, with an AUM of more than $1.5 billion. Aju IB Investment, established in 1974, offers SMEs investments and consulting services. Aju IB achieved record earnings in 2020 with nine successful IPOs of the companies it invested in. Vaxcell Bio, YoungLimWon Soft Lab, KoBioLabs are some of the companies in Aju IB’s portfolio that debuted KOSDAQ in 2020. Aju IB has a US subsidiary Solasta Ventures, for making global investments. The VC firm expects a bumper 2021 as about 20 startups in its portfolio are set to launch their IPOs. Krafton, Yanolja, Yanadoo, Ridibooks are some of the leading startups in Aju IB’s portfolio. Aju IB Investment’s consulting services include business management, tax, accounting, legal, mergers and acquisitions, additional funding, marketing, and technology support.
SoftBank Ventures Asia is the corporate venture capital arm of SoftBank Group. The firm prefers to invest in the IT, smart robotics industry, Artificial Intelligence, IoT, information, communication, and technology sectors. Founded in 2000, it is based in Seoul, Korea, with a presence in San Francisco, Tel Aviv, Singapore, Beijing, and Shanghai. Hyperconnect, one of the startups it has invested in, recently was acquired by global dating online company Match group. Some of the other top Korean startups in Softbank Ventures’ portfolio include Spoon Radio, Danggeun Market, Lunit, and unicorn startup Socar. The company’s AUM is over $1.3 billion with investments across Asia. The Venture company wants to focus on AI-driven startups. In 2020 it invested $30 million in eight startups, including Socar.
KB Investment Co., Ltd. (KBIC) is one of Korea’s leading investment firms of venture capital and private equity funds with over $ 1.4 billion of AUM. KBIC is a subsidiary of KB Financial Group, Korea’s premier financial group with the largest domestic customer base and the widest network of service branches in Korea. KBIC annual revenue for 2020 went up 165 % year-on-year growth. KB Investment has made 43 investments. KBIC invests across stages of a company’s life – Early, Growth and Buyouts – and across sectors – IT, Industrial, Consumer, Healthcare, CleanTech, and more. KBIC invests in both listed and unlisted companies.
Their most recent investment was in February 2021, when US-based TomoCredit raised $7 million. Dable, QS tag, Archisketch, Contents First are some of the Korean startups it has invested in. The company has also invested in startups in Israel, Vietnam, Indonesia, Europe, and the USA.
KTB Network is a Seoul-based VC company started in 1981 funded by the government. Now, KTB has grown into a group that encompasses overall finance such as securities, asset management, venture capital, and private equity. It has offices in China and the USA.
The Investment firm is set to launch its IPO in 2021, having achieved more than 129% growth in 2020. KTB sold its investment in Woowa Brothers this year, making a 26-fold profit. KTB Network has made 38 investments, and its AUM is more than $1 billion. The company has made major investments in startups in India, China, and other Asian countries. It has invested in FinTech, healthcare, e-commerce, biotech, and more.
POSCO Capital is a Venture capital fund by Korea’s leading steel-maker company POSCO. It is a stable shareholder-based new technology financial company composed of POSCO and POSTECH. POSCO Capital has been founded to discover and foster promising new technology companies and venture companies. POSCO Capital invests across multiple sectors such as Media, BioTech, Semiconductors, Renewable Energy, FinTech, Technology, etc. Some of its notable investments include Cafe24, AromaSoft, B&D Energy, Applied Science. The firm has AUM worth more than $950 million. POSCO has entered into important partnerships with The Ministry of SMEs and Startups and the Korean Venture Capital Association to invest over $800 million in various promising Korean startups.
Smilegate Investment has established and operated about 50 funds and invested in about 400 companies since it launched the first venture capital fund in 2000. Smilegate Investment is a venture subsidiary of leading Korean video game developer Smilegate. The company’s assets are more than $800 million, and it has invested in startups in health, biotech, ICT, Travel, Environment, Content & Entertainment. Smilegate is one of the leading investors for gaming startups. It has investments in companies like MyRealTrip, Fount, BackPacker, Motion AI, Seen Nine, etc. The venture fund was launched in 1999 as MVP Capital, and Smilegate gaming company acquired it in 2011.
Mirae Asset Ventures Investment is a venture capital fund of the Mirae Asset Financial Group, a leading financial services group in Korea. The company invests in startups that are in ICT, Games, e-commerce, biotech, eco-friendly goods, edutech, travel, IoT, FinTech, digital health, etc. The VC firm’s AUM as of 2020 is over $670. Its portfolio includes companies whose public issues are most anticipated in 2021. Market Kurly, which is said to be the next e-commerce unicorn startup of Korea, Musinsa, fashion e-commerce site, Bucketplace, interior decoration supply platform, are in Mirae’s investment portfolio. The VC firm saw a 50% increase in its revenues in 2020 from 2019.
Stonebridge Ventures, based in Seoul, Korea, was founded in 2017 as a spin-off from Stonebridge Capital’s venture capital investing arm. It invests in seed to late-stage technology companies across the consumer, enterprise, bio/healthcare, and fintech spaces. Stonebridge Ventures has an AUM of more than $ 600 million across multiple funds. Stonebridge Ventures has invested in Fintech startup Rainist, rental property platform Zigbang, Socar, Dunamu, Ticket Monster, and more. It has also bought a stake in Asiana Airlines.
- Korean Travel startup My Real Trip gets fresh investment of $36 million amidst pandemic slowdown
- Korean Radar technology startup Bitsensing raises $5.8 million investment
- Fresh investment for Korean startup Tripolygon that makes high-end 3D modeling tools loved by game developers
- Naver-led investment to help Carousell achieve ‘unicorn’ status