[Exclusive] 'Agisang-eo' Enters KOSPI... Korea's First Trillion-Won Infant and Child Content Created (Comprehensive)

Mirae Asset Securities Begins Initial Due Diligence on 13th, Officially Launching KOSPI Listing
First Domestic Trillion-Won Content Listing Company Emerges "Driving Force Behind Global IP and K-Content"

[Asia Economy Reporter Lee Seon-ae] For the first time in South Korea, a toddler and children's (character) content company with a valuation in the trillion-won range is set to be listed. The protagonist is SmartStudy, the owner of the world's No.1 YouTube view count (9 billion cumulative views as of August) 'Pinkfong Baby Shark.' Starting as a small content company with about 250 employees in 2010, it has opened a new horizon for K-content, becoming the country's first unicorn (a private company valued at over 1 trillion won), and is now stepping up to become a publicly listed company on the stock market.

On the 13th, Mirae Asset Securities, the lead underwriter for SmartStudy's listing, will conduct initial due diligence to assess the company's valuation. Although rumors of SmartStudy's listing have continuously circulated in the market, the company has only stated that no final decision has been made regarding the listing. An investment banking industry insider hinted, "Listing on NASDAQ was also considered as an option, but if the desired valuation is recognized in the domestic market, a domestic listing is a better choice, so the focus is on entering KOSPI."

SmartStudy's internally desired valuation is reported to be up to 4 trillion won. However, even if it falls short of this, the industry estimates that a valuation of over 1 trillion won is possible. If SmartStudy successfully completes its initial public offering (IPO), it will become the first toddler and children's (character) content company in South Korea to be listed with a valuation in the trillion-won range.

The company Iconix, which is pushing for a listing with 'Pororo the Little Penguin,' has a valuation of up to 400 billion won. Founded in 2001, Iconix produces animations such as 'Pororo the Little Penguin,' 'Tayo the Little Bus,' and 'Chiro and Friends,' exporting animations and character products to over 130 countries worldwide. Previously, 'Carrie and Toys Friends' company Carriesoft was listed on the KOSDAQ market in 2019 with a public offering price of about 52 billion won, and its current market capitalization is around 100 billion won.

The background enabling SmartStudy's entry into the trillion-won valuation range lies in the intellectual property (IP) value of Pinkfong Baby Shark. The market currently values it at about 1 trillion won, but the Baby Shark IP value is expected to increase further. SmartStudy is creating additional value by expanding the IP into areas such as animation, theater, and film. It has collaborated with over 500 domestic and international companies including LG Electronics, Nongshim, Yanolja, Kellogg's, Crocs, and Crayola, signing more than 1,000 licensing contracts, with continuous expansion ongoing. It is already recognized as having the highest competitiveness in the global market for toddler and children's content IP.

Pinkfong's official English YouTube channel has surpassed 50 million subscribers, earning the '50 Million Award.' In November last year, 'Pinkfong Baby Shark Dance,' the most viewed video on YouTube, reached 9 billion views as of August. Recently, SmartStudy has also begun producing a 2D animation series movie 'Baby Shark Big Show' in collaboration with Nickelodeon, the world's largest kids' channel. This follows the success of the 'Baby Shark Big Show' animation, which ranked No.1 in U.S. viewership and was a hit in global markets including the UK, Italy, and Australia. Currently, SmartStudy is overwhelmed with love calls it cannot keep up with, smiling broadly. SmartStudy's ultimate goal is to grow into a global comprehensive IP business content company.

The industry views SmartStudy's opening of the toddler and children's K-content market as a positive sign that continuous opportunities will arise for other domestic companies as well. The market's focus on SmartStudy's valuation in the trillion-won range stems from the judgment that if the value of toddler and children's (character) content is properly recognized, the ripple effect on the industry will be significant.

Meanwhile, as of the first half of this year, SmartStudy's valuation was also recognized at 1 trillion won. During the investment attraction process, it was valued at over 1 trillion won, becoming the 13th unicorn company in South Korea. This is the first for a domestic content company. Additionally, in June, Samsung Publishing, SmartStudy's second-largest shareholder, sold 40,000 shares to an institutional investor for 13.1 billion won, and SmartStudy's market capitalization based on this secondary share transaction was estimated to be over 805 billion won. Samsung Publishing's shareholding ratio changed from 18.5% (454,243 shares) at the end of 2020 to 16.9% (414,243 shares). The largest shareholder is Kim Min-seok, son of Samsung Publishing CEO Kim Jin-yong. After working at Nexon and NHN, he joined Samsung Publishing at the end of 2008, overseeing digital content, founded SmartStudy in June 2010, and currently holds 19.43% of SmartStudy's shares as the largest shareholder.