[StartupRecipe] Korean VCs Speak on the K-Startup ecosystem

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#Weekly Funding Overview

[June.17~ June.21]

The total funds raised by Korean startups of the week is KRW 22.1 Billion.

Company	Inudustry	Amount	Round	Investors
Elevenliter	Pettech	-	Grant	TIPS
ETS		20 billion	SeriesD	Atinum Investment, KB Investment, Korea Investment Partners, DA Value Investment, Deasung Private Equity
Nation A	GenAI	2 billion	Pre-Series A	Mirae holdings, Hana Securities, Magna Investment, Infobank
Laka cosmetics	Cosmetics	42.5 billion	M&A	Goodai global
itruck	Truck trading platform	1 billion	Series A	Hankook&company
Nota	AI model optimization	30 billion	Series C	Stick Ventures, LB Investment, Stick Ventures, KDB Development Bank, Mirae Asset Securities, Stone Bridge Ventures, LB Investment, Intervest, DS Investment Partners
Uniqonn	Wireless high-speed data transfer solution	10 billion	Series A	Doosan Investment, Hanwha Investment & Securities, SV Investment, L&S Venture Capital
Bitsensing	Imaging radar system	35 billion	Series B	HL Mando, Korea Development Bank, IBK Industrial Bank, Woori Financial Capital, Life Asset Management, Samchully Investment
Mongta	Content	-	M&A	Hypermind
Ldcarbon	Sustainable chemical products	40 billion	Series C	Woven Capital, Meritz Securities, Investwith, Industrial Bank of Korea, Zero One, Elohim Partners, New Main Capital
AES Tech	Eco energy	4 billion	Pre-Series A	Schmidt, L&S Venture Capital, Intervest, Leverage, Dankook University Technology Holding Company
Fustlab	Manufacturing	-	Grant	TIPS
AiLive	3D Content	-	Grant	TIPS
Bread&Rose	Brand commerce	-	M&A	Fastview
Miridih	Design SaaS	11 billion	Series B	Kiwoom Private Equity, Industrial Bank of Korea, Shinhan Venture Investment
Grucompany	Webtoon solution	-	Pre-Series A	Korea Investment Accelerator, Thanks Ventures
Mimetics	Cosmetics	-	Grant	TIPS
Ecobios	Bio	-	Grant	TIPS
BeyondDX	Bio	-	Grant	Deeptech TIPS
Uproot company	Blockchain	-	Grant	TIPS
INTELLIZ	AI Manufacturing	-	Grant	TIPS
DMS-Chemical	Materials	-	Grant	TIPS
CVRN club	Hairloss care	-	Grant	TIPS
HFBG	Food	2 billion		Kodit, KB Kookmin bank
Euler Robotics	Logistics Robotics	-		Yoonmin foundation, Megastudy
Trenb	Fashion platform	-	Series E	IMM Investment, Korea Investment Partners, Atinum Investment, Murex Partners, SL Investment
Kristin Company	Shoe tech	-	Grant	Scaleup TIPS
GRINDA AI	AI Solution	-	Grant	TIPS
Rototobebe	Kids brand	15.8 billion	M&A	Company K Partners
Plactical	Edutech	-		KODIT

#Major Funding

• Resource recycling and raw material regeneration company Ldcarbon has secured 4 billion won in investment. The company’s main product is recycled carbon black, which is extracted from waste tires and is mainly used as a raw material for tires, rubber compounds, and inks. The company plans to use the funds to build a new facility using resource recycling and pyrolysis technology.
• Bit Sensing has secured 3.5 billion won in investment. Founded in 2018 by automotive radar experts, the company develops solutions for various fields such as autonomous driving, smart cities, and digital healthcare based on automotive-grade radar technology.
• AI optimization startup NotaAI has secured 3 billion won in investment. The company specializes in edge and on-device generative AI technology optimized for devices and plans to provide high-performance generative AI model optimization technology to AI semiconductor companies.
• Wireless communication semiconductor startup Uniqconn has secured 1 billion won in investment. The company, which develops next-generation transmission solutions, plans to focus on mass production, supply, and product commercialization with the investment.

#Trend Analysis

Korean VCs Speak on the K-Startup ecosystem

As 2024 reaches its midpoint, recent inquiries into the perspectives of Korean investors have provided valuable insights into the current state of Korea’s startup investment environment. The findings reveal a cautiously optimistic outlook among industry leaders. Most investors agree that while the investment climate has improved since last year, a full recovery has not yet materialized. Despite this, there’s a prevailing sense of positivity regarding the continued emergence of high-quality talent and teams in the startup ecosystem.

Kwon Do-gyun, CEO of Primer, highlighted an interesting trend: “We’re seeing more people from large IT companies entering the startup scene. Interestingly, launching a startup during a market downturn often presents a higher likelihood of success.”

Hwang Hee-chul, General Manager at Bluepoint Partners, noted the evolving sophistication of entrepreneurs. “The caliber of entrepreneurs has significantly improved through access to startup-related information,” he stated, adding, “Now we need to reconsider what constitutes competitiveness in venture capital.”

However, global investors have raised concerns about the high valuation of Korean startups. Shane Shin, CEO of Shorooq Partners, remarked, “From a foreign perspective, the valuation of Korean startups is ridiculously high.” This sentiment was echoed by Pierre Joo, CEO of Korelya Capital Korea, who reported hearing similar concerns from global investors.

Artificial Intelligence (AI) remains the most sought-after investment sector both globally and within Korea. However, many investors express skepticism about the suitability of the foundation model approach for domestic startups. Lim Sung-ho, head of Translink Investment, shared his focus on B2B SaaS solutions, noting the high growth potential in this area despite its relative immaturity in Korea compared to overseas markets.

Lee Kyung-hoon, CEO of Global Brain, expressed strong interest in vertical SaaS investments, particularly in areas where Korea holds a competitive edge, such as CRM SaaS and content. Some investors are also exploring opportunities beyond AI, with Lee Kyo wook from Korea Investment Partners mentioning interest in Korea’s robust cosmetics sector, and Altos Ventures considering beauty-related investments alongside AI and B2B SaaS.

Concerns about the sustainability of follow-up investments persist. Lee Tae-kyung, CEO of Mashup Ventures, warned of potential difficulties in securing smooth follow-up funding due to continuing investment conservatism.

The survey also explored the concept of Korean venture capital expanding globally, revealing a mix of skepticism and perceived necessity. While some view Korean VCs as potentially less competitive in global markets, others see international expansion as an opportunity to gather valuable insights on global trends. Despite these differing views, there’s a generally positive outlook on building international careers in the long term, particularly for VCs with successful track records in Korea’s strong sectors.

As the Korean startup ecosystem continues to evolve, these insights from leading investors offer a nuanced perspective on the challenges and opportunities that lie ahead in an increasingly dynamic global investment landscape.