Participating in the Korean Technology Venture Market. - KITIA, The Pathway - Chris Lee

Transcription

1 Participating in the Korean Technology Venture Market - KITIA, The Pathway - Chris Lee

2 Korean Technology Venture Market Overview Korean technology venture market is driven by National Growth Momentum Industries and conventional key industries adopting technology innovation. National Growth Momentum Industries Key Industries Adopting Tech. Innovation New technologies provide national growth momentum Digital TV, Display Intelligent Robot Future Automobiles Next Generation Semiconductors Next Generation Mobile Communications Intelligent Home Network Digital Contents Next Generation Batteries Biotechnology Drugs Components and Materials Machineries Steel Manufactures Technology innovation Shipbuilding brings sustained Petro/Fine Chemicals growth Electronic Appliances Aerospace Environmental Energy Design Textiles and Fashion Early Growing Mature H:directory/file name _date

3 Korean Technology Venture Market Stakeholders The government is the major stakeholder in the Korean technology venture market. The Government s Participation in Korean VC Fund ( KRW bn ) Government s R&D Grant to Industrial Technologies ( KRW bn ) , ,934.1 Debt Financing to Technology Companies by The Korea Industrial Bank ( KRW bn ) ,500.0 Korean Government National Pension Fund: Actually under influence of the government Others: Institutions, Foreign Investors, Individuals H:directory/file name _date

4 Korean Technology Venture Market Driving the Future Technologies drive to create economic value of USD 240 billion taking up 25% of GDP by 2012 in Korea. Economic Value of the Technology Industries GDP: $1132 bn 12% ( $ bn ) GDP: $846 bn GDP: $750 bn 11% 8% 10% 6% 13% National Growth Momentum Industries (New technologies) Key industries adopting technology innovation H:directory/file name _date

5 Korean Technology Venture Market Rules of the Game Securing the government R&D grant and VC investment are important part of the game for early to mezzanine stage companies while business partnering is critical for later stage companies. Technology companies along development stage IPO Embryonic/Early Stage Mezzanine Stage Late stage Stake Holders Value Leverage Government R&D Grant VC Investors Capital Fuel Business Partners Sales International business partnering becomes more critical as the value of domestic partnering is limited and even it gets more competitive. H:directory/file name _date

6 KITIA is the government backed investment service platform serving investors as well as Korean technology companies. 1. Access to proven dealflows, business/market information 2. Networking with Korean technology market stakeholders all at one place 3. Leveraging value of the investment by government grant matching program 4. Channeling your needs to the government and back to you with answers KITIA serves you as the gateway to participate in the Korean technology venture market and help you to play winning games. H:directory/file name _date

7 KITIA system screens globally competitive technology companies and provides R&D grants as long as private investors participate the deal. Investment of KITIA member companies if the commercial due diligence is positive A Technology Venture Company 4 Member Companies conducting commercial due diligence 1 Application for Government Support 5 Government support if KITIA member companies commit their investment in the venture company 3 Request Commercial Due Diligence if the technology evaluation is positive Venture Capital Co. New Technology Finance Co. Development Finance Co. Banks Insurance Co. Securities Investment Co. Business Partners The Ministry of Commerce, Industry & Energy (MOCIE) Affiliated Research Institute to MOCIE ITEP (Korea Institute of Industrial Technology Evaluation and Planning) 2 Ask Technology Evaluation H:directory/file name _date

8 KITIA became the pathway to success for Korean technology companies Total Number of KITIA Portfolio Companies Government R&D Grant from the KITIA System (KRW billion) Matching Fund from the KITIA Member Companies (KRW billion) H:directory/file name _date

9 Performance of the portfolio companies clearly presents how KITIA system works. (KRW 100 Million) 9,000 8,000 7,000 6,000 Performance of KITIA s Portfolio Companies Average CAGR of Small to Mid cap technology companies: 13% CAGR: 32% (00-04) Total Asset Sales 5,000 4,000 3,000 CAGR: 45% (00-04) Average CAGR of Small to Mid cap technology companies: 12% 2,000 1, Sample: 27 survey participants out of 42 companies which became KITIA portfolio in H:directory/file name _date

10 Time to IPO may be the ultimate performance measure for both portfolio companies and KITIA system itself from the investors point of view. Company Joining Year to KITIA Portfolio Products IPO Year 2005 Sales KRW bn Value (KRW) at Investment by KITIA members KPT Metal surface/ heat treatments 2002, Apr /share Sekonix Opto electronics 2001, Aug /share SilverStar Corporation Industrial fabrics 2003, Jul /share Amotech Amorphous core, Ceramic chip component 2003, Aug /share Powerlogics Protection circuit Module 2003, Jul. 1, /share Daejoo Electronic Materials Insulation, conductive Materials 2004, Dec /share Havit Information Diffraction Grating, Optical Parts Jun /share Innochip Technology ITM Series, ITD Series, RF IC Dec /shre Clean Air Technology 2001 Filter bag, Air conditioning filter Jul /share SSCP 2001 Special Paint, UV/Polyester Resin Oct. 1, /share MEDIPOST 2001 Cord Blood Hematopoietic Stem cell Jul /share OnTimetek 2002 Multimedia Video Streaming Solution Jul /share Telechips 2003 Digital Multimedia / Caller ID Chip Dec /share BIEMT 2003 Semiconductor/LCD mfg. process Jan /share IDS 2003 LCD Module / Image Sensor Module Nov. 1, /share NewFlex Technology 2003 Flexible Printed Circuit Board Jan /share LifeCode 2004 Cord Blood Transplant May /share ViroMed 2005 Gene Therapy Recombinant Protein Dec /share H:directory/file name _date

11 Time to IPO may be the ultimate performance measure for both portfolio companies and KITIA system itself from the investors point of view (Continued). Number of new portfolio companies of KITIA since Total Number of New IPO Companies Average Time to IPO: 2.6yr IPO Year Total 18 companies have become public among KITIA portfolio companies and their average time to IPO was 2.6 years. H:directory/file name _date