[VC Now] ① DSC Investment "Raising Young Giants Who Will Change the World"

Investing in Early-Stage and Tech Companies... Key Words: Zigbang, Musinsa, Kurly, Dunamu, Moloco
Moloco, with 1 Billion Investment, Plans Nasdaq Listing Next Year
CEO Yoon Geon-su: "Investment Changes the World... Contributing to Changing the World"

Editor's NoteVenture capital (VC) nurtures early-stage companies that will become the pillars of future industries at the forefront of the capital market. Although the VC industry is experiencing a downturn due to the global economic recession and high interest rates, efforts to identify and cultivate promising companies continue unabated. Asia Economy meets various investment firms, from large-scale VCs with accumulated experience and know-how to emerging VCs, to hear about their investment strategies and stories.

The DSC Investment office is filled with various comic books and a wide range of other books. Photo by So-yeon Park muse@

The DSC Investment office on Ttukseom-ro, lined with nostalgic comic books like 'Slam Dunk' and 'Monster,' was bustling. Yoon Geon-su, CEO of DSC Investment (and Chairman of the Korea Venture Capital Association), who had been in relay meetings all day, rushed into the conference room out of breath.

When asked why there was no one in the office, CEO Yoon said, "If you have studied, you should go out and find companies."

"Everyone goes out to meet people. You can't just wait here. You have to study which industries will do well in the future, which technologies are important, and then go meet the people who have them. Among the companies that come here to give presentations asking for investment, there are few that are truly promising."

DSC Investment, which focuses intensively on early-stage tech companies, has discovered and nurtured numerous unicorn companies (unlisted companies valued at over 1 trillion KRW). Moloco, an adtech (advertising and technology combined) company planning to enter NASDAQ next year, is a promising candidate expected to reach a valuation of up to 6 trillion KRW upon successful listing.

Recently, a financial firm sold some of Moloco's existing shares (about 2% stake), recovering approximately 64 billion KRW. This represents a return of over 30 times the principal. DSC Investment expects returns exceeding 40 times. They invested 1 billion KRW and aim to recover over 40 billion KRW.

"Among the companies we've invested in, the one we are most optimistic about right now is Moloco. It will be listed on NASDAQ next year, and we expect it to be the most successful case in the history of Korean companies."

DSC Investment was launched in 2012 with a total capital of 6 billion KRW, including 1.7 billion KRW invested by CEO Yoon Geon-su. Since then, it has quickly established its position in the industry by specializing in early-stage company investments.

It gained attention by discovering domestic and international unicorns such as Zigbang, Musinsa, Kurly, Dunamu, and Moloco at an early stage. Last year, marking its 10th anniversary, it surpassed 1 trillion KRW in venture fund assets under management (AUM), becoming a top-tier VC in Korea.

"The venture market isn't great these days, but everything has its time. From an exit perspective, it's not ideal, but if you think about it as the time to invest, it's actually good. The Q3 results of VCs are out now, and the investment amount has increased compared to Q3 last year."

Yoon Geon-su, CEO of DSC Investment. Photo by Younghan Heo younghan@

"People are technology, and technology is the company"

The biggest characteristic of DSC Investment as an investor is its technology-centered investment approach.

"We have a separate deep tech division and have made many technology-related investments. We take over technology-related investments from our accelerator subsidiary Schmidt and make follow-up investments. Among Korean VCs, we probably have made the most technology-related investments. We mainly look at companies related to artificial intelligence, secondary batteries, and related technologies, focusing on companies with original core technologies rather than mere imitations."

In 2017, DSC Investment established its accelerator subsidiary 'Schmidt' to diversify deal sourcing channels. Schmidt discovers and nurtures early-stage companies, and DSC proceeds with follow-up investments.

"DSC has about 20 employees, Schmidt about 10, totaling around 30. There is no reason to get angry at the company. The employees are all smarter than me. We express what we want to say and each share their opinions to find common ground."

DSC is a stable company boasting a '0% turnover rate among investment officers.' This is an indicator of CEO Yoon's leadership.

"Successful investment officers have no reason to leave. People who stay in one place steadily often perform well. You just need to receive incentives and invest diligently at the company you belong to. You don't get paid more by moving elsewhere. People don't leave companies that have good funding. If you have investment resources, a system, and accurate calculations of investment results, there is no reason to move."

CEO Yoon earned his bachelor's and master's degrees in electronic engineering from Kyungpook National University and a master's degree in business administration from MIT Sloan School of Management. He started working at LG Advanced Institute of Technology in 1988, entered the venture investment industry in 1999 at Korea Technology Investment, worked at LB Investment from 2007, and then founded DSC Investment.

DSC Investment's internal directors include CEO Yoon and two executive directors, Park Jung-woon and Kim Yo-han. Executive Director Park holds a bachelor's degree in business administration from Sungkyunkwan University and joined LS Cable in 2002. He worked with CEO Yoon at LB Investment from 2007 and joined DSC Investment in 2014.

Executive Director Kim, born in 1983, holds a bachelor's degree in pharmacy and a master's degree in pharmaceutical sciences from Seoul National University. After working at Hanmi Pharmaceutical and IMM Investment, he joined DSC Investment in 2015. He has been recognized for successfully leading the KOSDAQ listings of bio companies such as ABL Bio, SCM Lifescience, iCure, and Genome & Company, which were discovered and invested in from the early stages.

Investment is about changing the world

"For somewhat larger investment firms, the era of steady sales and profits has arrived. Ultimately, those who have done well are more likely to continue doing well because they have a large portfolio. Currently, our portfolio companies exceed 200. We add about 20 each year and exit investments accordingly. Companies that have shown good performance in the market are likely to continue performing well."

DSC Investment has consistently recorded sales of 30 to 40 billion KRW over the past three years, with operating profits ranging from 15 to 30 billion KRW. Going forward, it plans to focus investments on aging and changes in how people work.

"The first is aging. Another is that young people no longer want to do hard work. This has changed. There is a shortage of workers. Therefore, we need to invest in systems that can replace human labor. For example, technology that allows one person to do the work of three. That is robotics, artificial intelligence, and software automation."

They also analyze the landscape of wealth.

"The baby boomer generation has mostly retired. That generation has the most money. Naturally, they are interested in health and spend money in that direction. Another interesting point is that when Lim Young-woong releases a new song, it quickly tops the charts. Lim Young-woong's fans are not in their 20s; they are in their 50s and 60s, using IT devices freely and actively. They also have purchasing power. We are interested in the baby boomer generation because they enjoy culture with both IT literacy and purchasing power."

DSC Investment considers two factors most important in early-stage company investments: ▲whether there is global demand and ▲whether the technology is competitive in the global market. Business areas and technologies targeting only the domestic market have limitations in increasing corporate value.

More fundamentally, for CEO Yoon, investment means "changing the world." "There are people with big dreams capable of changing the world. Among venture entrepreneurs, there are those who will become giants. We move those with such ambition and passion through our investments. DSC Investment wants to contribute to Korean young giants changing the world."