Knock on 'K-Nock,' the Gateway for Investment in Small and Medium Content Companies

Ministry of Culture, Sports and Tourism & Korea Creative Content Agency Promising Content Investment Support Program
Video Monster Wins Grand Prize at 1st Demo Day... Recommended for Linkage Fund No. 3 Investment
Bonus Points in Next Year's KOCCA Support Program Evaluation... Focus on Raising 3 Billion KRW and Global Marketing

Jeon Dong-hyuk, CEO of Video Monster, faced difficulties in IR until last year. Although the company had sufficient competitiveness, demo days specialized in content and related technologies were rare. Most venture capitalists (VCs) turned their backs due to the unfamiliar market and technical jargon. Video Monster operates a platform that automatically produces online marketing and social network service (SNS) videos. It boasts as many as 4,294 design templates and also has a cloud-based rendering engine. Even without editing or design skills, high-quality motion graphic videos can be created in about three minutes. Addressing the concerns of small and medium-sized enterprises that relied on costly outsourcing production, the company expanded into Japan, Vietnam, Thailand, and other countries. CEO Jeon said, "We sought differentiation through various design templates" and added, "We established an in-house production system to respond immediately to trends and demand."

The service, launched in June 2019, quickly settled in the market. It attracted about 300,000 members and sold 140,000 videos. CEO Jeon has no intention of resting on his laurels. With an investment of about 3 billion KRW, he plans to recruit high-level personnel necessary for scale-up and focus on global marketing. On the 9th, the feasibility of this plan increased significantly. Video Monster won the grand prize (1st place) at the first demo day of the content pitching platform KNock. KNock is a program supported by the Ministry of Culture, Sports and Tourism and the Korea Creative Content Agency (KOCCA) to assist promising content companies in attracting investment. It holds specialized demo days for content, providing a venue to verify the achievements of participating companies and interact with investors.

CEO Jeon took the stage after thorough pitching training, including VC mentoring, IR deck consulting, and design and pitching consulting. A policy finance team leader at KOCCA said, "We invite top VCs from various fields such as animation, characters, and games as mentors to check not only corporate investment attraction strategies but also various indicators and materials," adding, "We provide meticulous advice on marketing commercialization and accounting and tax management so that customized IR can be prepared." CEO Jeon said, "The vivid education and advice from active VCs were a great help." He explained, "Their understanding of content was exceptional. For example, in IR preparation, they summarized the market explanation clearly and concisely. Most companies mention the expansion or scale of the YouTube market. We limited the scope to the online video advertising production market, which alone is about 7 trillion KRW. The domestic market is estimated at 339 billion KRW. By studying how to effectively target VCs, we were able to establish a new future vision."

KNock demo days attract great interest from the VC industry every time, as KOCCA builds a solid network based on the mother fund. This online event was watched by 1,407 viewers. The IR voting system, introduced for the first time this year, received 7,497 votes. The team leader said, "We established the voting system as a reward for the companies' efforts," adding, "It was effective in publicly promoting the participating companies." Award-winning companies receive prize money and special benefits. They are granted eligibility for investment recommendation from the Content Valuation Linked Fund No. 3 and receive additional points in the written evaluation for KOCCA support project selection next year.

CEO Jeon has already reaped sufficient benefits. Right after the demo day, he received meeting requests from three VCs. More than ten VCs requested materials. He plans to induce investment and attract 3 million members by 2024, achieving annual sales of 10 billion KRW. He said, "We plan to increase the number of design templates to 10,000 and expand into the U.S. Next year, we will also launch a B2C (business-to-consumer) application. It combines camera and automatic video editing functions, so it is expected to make a splash."

Park Hyung-chul, CEO of Nfusion, who won the Excellence Award (3rd place), also gained momentum in operations. VC contacts have not stopped since the demo day. Nfusion is a company that produces the 2D animation mobile RPG game 'Artifact L.' It possesses technology to create high-quality 2D animation from a single image. Game characters require more detailed depiction and longer drawing time as their body proportions increase. This is why most 2D character collection RPG games currently on the market are made with SD characters (a visual expression technique representing human-shaped characters in 2 or 3 heads tall). CEO Park said, "By applying our technology, drawing tasks are minimized, allowing high-quality characters to be expressed smoothly and delicately without burden."

Nfusion has been able to concretize new approaches by participating in KNock since 2018. They received mentoring and training and participated in various matching programs. CEO Park secured the first investment through KOCCA's mediation: 550 million KRW from Synergy IB Investment. Last year, thanks to KOCCA promoting pitching materials overseas, they received 1.34 billion KRW investment from Indonesia's Salim Group. He said, "These two investments led to additional investments of 3 billion KRW from KB Investment and Hanwha Investment & Securities," adding, "KNock will definitely provide solutions to content companies that are at a loss about how to attract investment." Lee Yang-hwan, head of KOCCA's policy headquarters, said, "KNock is a venue to overcome the COVID-19 crisis and expand the investment attraction possibilities of small and medium content companies," and requested, "Please show great interest in the second demo day to be held on November 11 at Tipstown S1 Tips Hall."