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"Rather than chasing trending deals, we have sought to map out the industry value chain in advance and invest in element technology companies that fill the gaps. I believe this framework is the secret behind our achievements so far."
Kim Kyung-sik, Managing Director of Stick Ventures, is recognized as a leading technical expert reviewer in the venture capital (VC) industry. He has proven his foresight by making early-stage investments in domestic representative deep-tech companies such as DeepX, 42Dot, Nota, and Liner.
At the end of last year, he also received the Minister's Award from the Ministry of SMEs and Startups for contributions to venture entrepreneurship promotion. Director Kim stated, "We mainly conducted Series A investments, and after six to eight years, many companies have either been acquired through M&A (mergers and acquisitions) or entered their exit cycles. It seems that the significant growth in employment and revenue as these companies expanded had a positive impact."
Director Kim is an engineer with a background in engineering who joined Hyundai Motor and worked for six years in the purchasing division. Having been interested in entrepreneurship since his university days, he chose the purchasing division believing that closely observing various companies would allow him to discover good startup ideas. In reality, working closely with partner companies enabled him to thoroughly examine industry value chains and cost structures. Later, when a Strategic Technology Division was established within the company to serve as a corporate venture capital (CVC), he naturally took his first step into the investment business.
He said, "Originally, I was more interested in business itself than investing, but once I started handling investment tasks, I found the fun of drawing the big picture of industries and making investments accordingly. That is why I decided to make investing my lifelong career."
During his time at Hyundai Motor, he extensively explored technology companies essential for the group's future strategies, such as smart cities and robots, through top-down research. The 'eye' developed then to analyze the overall industry value chain and distinguish quality from inferiority within it became the foundation for identifying his current core investment portfolio. He later gained experience in LP (limited partner) operations and direct investments at Shinhan Bank GIB, joined CJ Investment, and finally joined Stick Ventures.
A representative track record proving his discernment is the AI semiconductor company 'DeepX'. After first connecting with DeepX during his time at Hyundai Motor, he moved to Shinhan Bank to execute formal investments. At the time of investment, DeepX's pre-money valuation was around 120 billion won, but during its Series D funding round, its corporate valuation exceeded 3 trillion won, continuing its growth trajectory.
Director Kim remarked, "At that time, the term NPU (neural processing unit) itself was unfamiliar, and NVIDIA did not yet hold the overwhelming status it enjoys today. Convincing internal stakeholders to invest in DeepX, which was an early-stage company, was not easy, but we proceeded with the investment boldly because we were confident in its potential for success."
FortyTwoDot, a self-driving startup acquired by Hyundai Motor Group, is another representative case. A company he had kept an eye on since his tenure at Hyundai Motor received consecutive investments from Shinhan Bank and CJ Investment, ultimately achieving a successful exit through acquisition by Hyundai Motor Group. In addition, companies such as Etopos and PebbleSquare, which were invested in through value chain analysis, continue to fill his portfolio.
When identifying deep-tech companies, the first thing Director Kim looks for is not simply 'technical capability'. He stated, "Having directly experienced the process of acquiring technologies in the purchasing division and turning them into products, I focus intensively on what market position a technology can occupy when realized as an actual product and the sales capabilities of the founding team. The ability to precisely fill gaps in the value chain or create entirely new markets is more important than the inherent excellence of the technology itself."
Technical due diligence is also conducted thoroughly with a focus on the field. In addition to interviews with key engineers such as the Chief Technology Officer (CTO) and analysis of technology roadmaps, multi-faceted reference checks are conducted through collaborating companies and research institutions. Director Kim emphasized, "The true object of verification is 'what can be done with this technology and how to sell it to whom,' which constitutes business viability."
After investment, efforts are also made for risk management and enhancing corporate valuation. While quarterly and semi-annual reviews are the baseline, in lead investment cases, he directly participates in board meetings to address key management issues. Additionally, support is provided in coordination with Stick Investment's OPG (Operating Group). The OPG is a full-time advisory organization established by Stick Investment in 2008 dedicated to enhancing corporate valuation, where management experts who are former executives of large corporations support portfolio companies in improving operational efficiency, making key decisions, and conducting on-site monitoring.
Director Kim plans to identify companies that can resolve bottlenecks in the AI infrastructure value chain in the long term. His strategy is to preemptively secure element technology companies that address bottleneck points occurring from within individual chips up to rack-to-rack connections. Given the expected explosive growth in upstream markets, he views these areas as worth securing even if it means bearing valuation burdens.
His goal is to create a signature deal that anyone can recognize by name. Director Kim said, "I want to become an expert reviewer known for deals like 'This company is Kim Kyung-sik's deal.' Until now, I have focused on early-stage investments through blended funds, but from now on, I aim to become a venture capitalist who accompanies companies as a core shareholder by supporting follow-on rounds of identified companies."
[MoneyToday startup media platform Unicorn Factory]
in FUTURE
