[VC Now]⑦ Big Bang Ventures "Starting Overseas, Not Domestic... Actively Utilizing Joint Ventures"

Interview with Gutaehoon, CEO of Big Bang Ventures
'Unique Investment Strategy: Investing After Overseas Validation'
"'Post-Oil' Business Expanding from Canada to the Middle East"

Editor's NoteVenture capital (VC) is nurturing 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 grow 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.

"We prioritize thinking about how startups can be recognized and grow overseas, focusing on 'global scale-up.'"

Recently, we met Koo Tae-hoon, CEO of Bigbang Ventures, at the Scale-up Center of Seoul Startup Hub in Gangnam-gu, Seoul. Bigbang Ventures is a young venture capital (VC) firm established in May 2022. Its assets under management (AUM), combined with its partner Bigbang Angels, an accelerator (AC) with 11 years of experience, amount to approximately 25 billion KRW. Bigbang Ventures is also the largest shareholder of Yuanta 15th SPAC, which went public this year with a scale of about 15 billion KRW.

When asked about their venture and startup investment strategy, CEO Koo introduced a unique model called 'investment after overseas validation.' The strategy is to discover and support startups that can succeed in the global market from the outset, rather than focusing on local business. Bigbang Angels conducts early-stage investment and technology verification for startups through the Ministry of SMEs and Startups’ support program TIPS, and Bigbang Ventures takes these startups overseas to assess their business viability. If the business potential is proven locally, follow-up investments are made. This approach differs from most VCs that expand startups' scale from domestic to overseas markets.

Koo Tae-hoon, CEO of Big Bang Ventures, is posing before an interview at the office set up in the Scale-up Center of Seoul Startup Hub in Gangnam-gu, Seoul. Photo by Kang Jin-hyung aymsdream@

"Forming Joint Ventures with Local Companies to Target Markets"

CEO Koo majored in computer engineering at university. He worked as an engineer for over 15 years at Kakao and Nexon and entered the VC industry in 2015. That same year, with the emergence of AlphaGo and the rising importance of artificial intelligence (AI), opportunities to work overseas increased. Naturally, he was able to build networks with local stakeholders.

Feeling the limitations of the domestic market, CEO Koo launched Bigbang Ventures with branches in Canada and Singapore. When expanding domestic startups overseas, they use a strategy of establishing joint ventures (JV) with local companies that can create synergy effects. "Imagine a company that is good at preparing vegetables selling bibimbap domestically. When this company goes abroad, instead of selling the unfamiliar bibimbap locally, it should apply its vegetable preparation skills to making curry," he explained. "By forming a JV with a local curry company, this startup can sell bibimbap in Korea and curry overseas. If the curry sells well, it naturally opens the door to introducing bibimbap."

CEO Koo said, "Many domestic companies want to enter the U.S. market directly. However, it is difficult to gain attention in the highly competitive U.S. market, and there is also the risk of not being able to trust the investors they meet. In North America, Canada acts as the seller of 'Made in Canada' products, and the U.S. is the buyer. Bigbang Ventures plans to establish a JV with a Canadian company familiar with the U.S. market and then enter the U.S. market."

Recently, the focus has been on the 'Post oil' sector. Accordingly, they are promoting a plan to establish a JV between Bizdata, a domestic water treatment technology startup, and a local soil and water analysis company in Alberta. CEO Koo said, "Alberta is the only place in resource-rich Canada where oil is produced, and it is geographically close to the U.S. It is a region with highly developed bio and livestock industries, and as the energy and oil sectors emerge, it has high potential in the post-oil era. Through JV establishment, we aim to provide soil contamination and remediation solutions using AI and big data analysis."

CEO Koo and Bigbang Ventures staff visited the Middle East repeatedly, including participating in the 'Middle East Economic Delegation' last October, to explore the scalability of soil remediation technology. "The oil business causes severe soil contamination. In the Middle East, preparing for the post-oil era requires contamination resolution measures, and Alberta already has a well-established remediation industry. We plan to apply our business model to Middle Eastern markets such as Saudi Arabia, Qatar, and the United Arab Emirates (UAE)."

'Post oil' in focus... Seeking opportunities in Canada and the Middle East

Companies such as GMX, FarmPro, and TME Therapeutics are also preparing to enter overseas markets using the same approach. GMX is a bio company researching and developing various pipelines (new drug candidates) based on sensory disorder (atopy, analgesics) and anticancer drug development. CEO Koo said, "Bigbang Angels and Bigbang Ventures invested about 1 billion KRW from the early stages in GMX, a company founded by a professor from Hanyang University Medical School. While developing an atopy treatment, they discovered anti-aging, wrinkle improvement, and whitening effects and have sent cosmetic samples to Canada." He added, "Similarly, commercialization and branding will be carried out locally."

Livestock technology startup FarmPro also plans to prove its overseas competitiveness. FarmPro attaches sensors to cattle ears to measure data such as body temperature and activity in real time and analyzes it with artificial intelligence (AI) to provide farmers with mobile notifications about health status, estrus, and calving times. Cultured meat technology startup TME Therapeutics possesses technology to stabilize and deliver growth factors essential for producing stem cells used in cultured meat development. This technology is expected to significantly reduce the production cost of cultured meat. CEO Koo said, "There is a company in Canada that ferments fly larvae to produce similar nutritional supplements. We recently had a successful meeting with TME Therapeutics, and the JV establishment process is underway."

Regarding this year's goals, CEO Koo said, "the timing of interest rate cuts seems to be delayed a bit. However, we mainly deal with overseas markets," noting, "Some Middle Eastern countries and Canada are aggressively opening doors to new industries." He added, "Ultimately, we are focusing on countries with much greater venture investment capacity regardless of interest rates. Recently, we established our third overseas branch, 'Bigbang Ventures USA,' in Boston, USA. The current AUM in the U.S. is about 9 billion KRW. We also plan to establish a fourth overseas branch in the Middle East."

Koo Tae-hoon, CEO of Big Bang Ventures, is being interviewed at the Seoul Startup Hub Scale-up Center in Gangnam-gu, Seoul. Photo by Jin-hyung Kang aymsdream@