For startup accelerators that nurture promising young entrepreneurs, identifying a soon-to-be-unicorn, or a company valued at over $1 billion, in its infancy and watching it succeed is something to be proud of.
Song Myoungsoo, founder and chief executive of PEN Ventures Korea, one of the leading startup accelerators in South Korea, however, says that for a lesser-known company to secure a patron, it must have one more critical trait – a determination to go global.
“While some domestic startups have become unicorns by focusing on the Korean market, we don’t invest in those firms. We primarily support startups in expanding their reach internationally,” he said in a recent interview with the global edition of The Korea Economic Daily.
“Our focus is on companies with potential for success in overseas markets. The world is interconnected, and growth knows no boundaries.”
The company has a global presence with overseas offices in Palo Alto (Silicon Valley), New York, Singapore and Stockholm, each of which operate as independent entities.
As its name PEN – an acronym for pioneer, explorer and navigator – indicates, the company believes navigating global markets requires agility and strategic finesse.
CEO Song said PEN Ventures equips startups with the skills and knowledge to tailor their business strategies to various regions while maintaining a cohesive global vision.
“We’re committed to building a diverse and extensive global network that empowers startups to navigate new markets, cultures and opportunities. Through our network, startups gain access to international mentors, partners and customers, enabling them to scale up their businesses on the global stage,” he said.
The company’s mission, the CEO said, is to foster startups with innovative and disruptive ideas and turn them into enterprises with successful business models.
Located at the International Finance Center in Yeouido, central Seoul, and supported by the Seoul Financial Hub (SFH), a startup incubator set up by the Seoul city government, PEN Ventures works with over 500 Korean startups annually through various government and private sector acceleration programs.
In addition to running various accelerator programs, the company independently invests in startups with deep technology at the pre-seed to Series A funding stages.
Early this year, PEN Ventures, as an investment advisory partner, was involved in the DIPS 1000+, a deep tech startup support program, and K-Unicorn projects organized by the KISED, or the Korea Institute of Startup & Entrepreneurship Development.
The company hosts PEN Corporate Innovation Summit (PEN CIS) meetings in Korea and abroad annually. These are gatherings of startups and global corporate venture capitalists (CVCs) for networking, pitching ideas and panel discussions.
Last month, it held PEN CIS 2024 in Seoul, featuring several Korean startups, including Bering Lab Inc., the developer of an AI translation platform for legal, patent, corporate and other professional documents.
Global CVC participants included Deutsche Bank, HBO, Microsoft and TikTok.
The company also hosts PEN CTA programs at least twice a year.
PEN CTA (Commerce & Technology Association) is a New York-based think tank that promotes commerce and tech exchange programs at governmental and private levels involving companies in Asia, Europe and the US.
Last week, PEN Ventures held a PEN CTA demo day in New York, offering 25 Korean startups handpicked by the Korean government the opportunity to meet with global CVCs and US government-sponsored organizations.
“We don’t only work with Korean companies. We also bring overseas startups to Korea,” said Song.
The following is an edited transcript of the interview with CEO Song.
▶ What are your mid- to long-term goals?
“Our vision is to grow into an institution that helps companies not only from Korea but also from India, the ASEAN and China enter markets like the US and Europe. Conversely, we aim to help companies from the US and Europe expand into Asia, such as Korea, Singapore and Indonesia.”
▶ Do you directly invest in startups?
“Yes, we do.”
▶ What is your investment scale?
“Since we are still a young accelerator, we make small-scale investments, ranging from 30 million won ($22,000) to 100 million won (74,000) in early-stage startups.”
▶ How much capital do you manage overall?
“We manage around 1 billion won ($740,000), which is a relatively small amount. We gather funds from individual investors to create investment pools for promising startups. While the amount of money is important, attracting the best startups is crucial. To achieve this, we need to have an ‘edge’ that sets us apart from other investment firms. I believe our strength lies in helping startups with global expansion. Unlike some organizations like KOTRA, which focuses on specific business areas, we are more focused on supporting startups in the early stages as they attempt to enter the global market.”
▶ How many accelerators are there in Korea?
“Around 450.”
▶ How long has PEN Ventures been around?
“We’ve been operating for two years and four months. More than 500 startups join our global support programs each year. We’ve had major investments, and we run notable programs in Korea, such as Deep Thousand and Baby Unicorn for deep tech companies.”
▶ What is deep tech, specifically?
“Deep tech refers to technologies that take longer to research and develop and address fundamental problems facing humanity. Korea’s Ministry of SMEs and Startups selected around 10 fields and the US Department of Commerce selected eight as deep tech sectors this year. Examples include system semiconductors, AI, future cars, energy, aerospace and cybersecurity. PEN Ventures supports not only Korea’s 10 deep tech fields but also promising global companies in areas like fintech.”
▶ How do you discover companies?
‘While we do actively search for companies, we also have strong platforms, and it’s much quicker for companies seeking global expansion to come to us directly.”
▶ What are your criteria for determining whether a company is truly promising?
“I believe in the importance of the ‘four-eye view.’ It’s better to have multiple perspectives rather than just one. For instance, when we take 10 mobility startups to Silicon Valley, experts from companies like Bosch or Honda evaluate them. I believe the collective intelligence of such experts is far more reliable than just my own judgment.”
▶What did you do before PEN Ventures?
“I worked at Korean Re for 15 years, with work experience in Singapore, Hong Kong and Seoul.”
Write to In-Soo Nam at isnam@hankyung.com
Edited by Jennifer Nicholson-Breen
