The VC Industry Also Faces an 'AI Boom'... Half of the Top 10 Investors Are 'AI Companies'

'DeepX' Ranked No.1 with 90 Billion Won Investment in Jan-Feb
Fabless Startup Developing AI Semiconductors
AI Core to Businesses of 3rd, 6th, 8th, and 10th Ranked Companies

The venture capital (VC) industry is also experiencing an artificial intelligence (AI) boom. Among the top 10 venture startups that received the most investment this year, half are companies focusing primarily on AI. Venture investment funds are pouring into 'AI companies.'

According to venture investment information firm 'The VC' on the 4th, the top company in terms of investment amount raised from January to February was AI semiconductor company 'DeepX,' which secured 90 billion KRW in investment. StradVision (42 billion KRW) ranked third, Upstage (25 billion KRW) sixth, Mobilint (20 billion KRW) eighth, and AnyAI (15.7 billion KRW) tenth?all companies that position AI as the core of their business. Last year, only two of the top 10 companies by annual investment amount were AI-related (Rebellion and Orchestr8).

VCs, PEs, and Asset Management Firms All Show 'Love for AI'

DeepX received 60 billion KRW from private equity fund (PEF) manager Skylake Equity Partners and 30 billion KRW from Timefolio Asset Management. DeepX is a leading domestic fabless (design) company developing AI semiconductors. At the 'Consumer Electronics Show (CES) 2024' last January, it attracted attention by unveiling the AI semiconductor 'DX-H1,' which offers more than 10 times the power efficiency compared to existing graphics processing units (GPUs). DeepX is currently in discussions with investors to secure an additional 30 billion KRW. Once the fundraising is complete, it will become a startup with over 100 billion KRW in investment for the first time this year. Additionally, its corporate valuation will jump to around 700 billion KRW.

StradVision, which raised 42 billion KRW, develops and supplies AI-based specialized systems installed in autonomous vehicles. Aptiv, one of the world's top three companies in the autonomous driving sector, participated in the investment. StradVision's cumulative investment amount is approaching 200 billion KRW. Two years ago, K-Clavis Investment, Nvestor, Timefolio Asset Management, and LSS Private Equity collectively invested 107.6 billion KRW in the company.

Upstage secured 25 billion KRW in investment from SK Networks. It is a leading startup in South Korea in the field of AI solution development and supply. Another AI semiconductor company, Mobilint, received 20 billion KRW in investment from Union Investment Partners, Daesung Startup Investment, Gamechanger Investment, and Kyobo Securities. Intervest, SV Investment, and Ignite participated as investors in AnyAI, which develops and supplies AI hamburger cooking robots. The total investment amount was 15.7 billion KRW.

"If It's an AI Company, We Take Another Look"

The VC industry is a place where rumors about successful companies and sectors spread very quickly. Jang Pil-sik, Executive Director at SV Investment, said, "Companies seeking investment emphasize their connection to AI during corporate presentations," adding, "It has become harder to find startups unrelated to AI." This means that even if AI is used in minor aspects, it is actively used as a 'wrapper' to attract investment. Na Sung-min, Executive Director at IMM Investment, said, "While AI-related companies do not necessarily receive bonus points during investment reviews, if AI is mentioned in the company presentation, it is true that we take another look."

Interest and investment in AI, which is emerging as a 'future growth engine' across industries, are expected to continue for the time being. Overall VC investment is also gradually recovering after a 'cold winter.' According to the public-private cooperation network 'Startup Alliance,' new venture investment in January reached 449.7 billion KRW, a 74.4% increase compared to 257.9 billion KRW in the same period last year. Although this is analyzed as a base effect due to the very poor situation in January last year, the prevailing assessment is that the worst is over.