5 Years of Steadfast Follow-On Investment '4.5 Billion Won Bet'... Estimated Profit at Least Twice the Principal
[Asia Economy Reporter Lee Seon-ae] Venture capital (VC) Stonebridge Ventures' investment foresight is drawing attention. As the investment in Jin System, which was persistently pursued for five years before its listing, shows signs of completion, it is understood that tens of billions of won in investment profits have been made so far. It is expected that when the final investment recovery (exit) is completed, the profit will be twice the principal amount.
According to the Financial Supervisory Service's electronic disclosure system on the 5th, Stonebridge Ventures sold 153,812 shares (2.2% stake) of Jin System on the market (block deal) on the 30th of last month.
Stonebridge Ventures has been steadily disposing of Jin System shares from July this year until the 30th of last month. During this period, they sold shares worth 1.23533 billion KRW through market trading and off-hours trading. As a result, Stonebridge's current stake in Jin System has decreased from 6.88% to 4.55%.
Jin System is a company in which Stonebridge invested persistently before its listing. Known for its reputation in technology-based company investments, Stonebridge invested a total of 4.5 billion KRW in Jin System over three rounds: 1 billion KRW in October 2017, 1.5 billion KRW in 2018, and 2 billion KRW in 2019. This investment began to bear fruit with Jin System's listing in May last year. After the listing, Stonebridge recovered its investment and made a profit. At the time of listing, Stonebridge was the second-largest shareholder with a 12.35% stake in Jin System, but in July last year, it sold a 5.47% stake to recover its investment. Calculated at the closing price on the transaction day, the scale of 372,654 shares traded amounted to approximately 7.47 billion KRW.
Accordingly, including the recent stock disposal amount, the total investment amount recovered by Stonebridge from Jin System exceeds 8.7 billion KRW.
Currently, Stonebridge's stake in Jin System is 4.55%, with 314,846 shares remaining. Calculated at the opening price of 7,210 KRW on that day, the value is approximately 2.27 billion KRW. A simple calculation suggests that if Stonebridge sells off the last remaining shares and completes the final exit, it could earn a profit of about 11 billion KRW. Considering the current market downturn and the sharp drop in Jin System's stock price compared to the listing price, if the stock price rebounds, the final profit amount will increase.
The industry evaluates that the persistent investment has paid off. At the time of investment in 2017, Jin System had excellent diagnostic device development capabilities and high commercialization potential but did not receive much attention compared to competitors. The founder's background was not as impressive as competitors', so it did not attract much attention from investors. At that time, the founder's background was an important point for investment. Jin System's founder, CEO Seo Yoo-jin, is an engineer by training. However, Stonebridge focused on the fact that compared to competitors' PCR devices, Jin System's products were superior in terms of testing time, product size, and price. Although the founder's background was not as glamorous as competitors' CEOs, who were medical doctors or physicians, Stonebridge did not care about this. After comparing Jin System's products with those of four domestic unlisted real-time PCR companies, Stonebridge judged Jin System's products to be the best and proceeded with the investment. They focused solely on technological competitiveness. After securing investment, Jin System continued to succeed in developing PCR equipment, but it took time to translate this into performance results. Stonebridge showed affection for Jin System by continuously making 'follow-on' investments, pouring funds into this smart investment target.
Meanwhile, Stonebridge is known as the domestic VC with the highest fund returns over the past five years. The current cumulative fund management scale exceeds 1 trillion KRW. Since 2017, it has invested about 579.1 billion KRW in approximately 140 companies across various sectors such as semiconductors, artificial intelligence (AI), medical devices, and heart disease. In addition to Jin System, it has successfully invested in Krafton (return multiple 35x), Woowa Brothers (return multiple 9.1x), and Croquiscom (return multiple 11.3x). Its investment portfolio includes high-quality unicorns (unlisted companies valued at over 1 trillion KRW) such as Musinsa and Dunamu.
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