[VC Now](25) Translink Investment: "Partnership Investment Is the Key to Developing the Venture Ecosystem"

Heeduck Park, CEO of Translink Investment, Interview
"VCs and Founders: Not a Hierarchy, but Partners"
"Spotlighting Startups Leading the AI Service Sector"

"The difference in the role of investment finance has created the gap between Korea and Silicon Valley. It is not a matter of technology or people."

What are the challenges facing the venture capital (VC) industry to advance Korea's venture, startup, and investment ecosystem? In a recent interview at D.CAMP in Gangnam, Seoul, Heeduck Park, CEO of Translink Investment, prioritized the 'expansion of partnership' between VCs and startup founders, emphasizing the need to establish the Silicon Valley investment philosophy in Korea.

He said, "In Silicon Valley, VCs and founders collaborate as partners, but in Korea, the structure turns founders who receive investment into subordinates. VCs must go beyond simply providing capital and be able to set the direction and growth strategy of startups together."

Heeduck Park, CEO of Translink Investment, is being interviewed on the 13th at D.CAMP in Gangnam-gu, Seoul. Photo by Jinhyung Kang

"Lack of Collaboration Culture Between Investors and Startups... The Essence of Investment Finance Lies in a Horizontal Contract Structure"

After graduating from Hanyang University with a degree in electronic engineering, Park began his career in 1994 at Samsung C&T as a sales engineer, sourcing advanced overseas technologies and commercializing them domestically. During the Asian financial crisis, he became interested in investment finance and entered the VC industry for the first time in 2000. He later worked at Korea's first venture investment firm, KTB, and in the venture investment teams of large corporations such as KT and CJ, before founding Translink Investment in 2015.

Over the past 25 years, he has invested in Korean, American, and Chinese companies in cutting-edge innovation fields such as semiconductors, mobile phone components, IT hardware, software as a service (SaaS), and artificial intelligence (AI). Adhering to the principle of specializing in Series A investments, he has managed approximately 200 billion won in assets under management (AUM) over the past 10 years since the firm's establishment.

What stood out to him during this process was the difference between advanced venture investment countries and Korea. He said, "In the early 2000s, Korean VCs approached venture investment like bank loans, focusing on financial statements. When I was dispatched overseas at the time, I saw that in Silicon Valley, with its 70-year history of venture investment, there was active investment based on the growth potential of companies."

He added, "China also actively accepted Silicon Valley capital, which led to the emergence of global giants like Baidu, Alibaba, and Tencent. China has about 200 companies listed on the NASDAQ, while Korea has only one. The difference was not in market size, but in the role played by investment finance."

He identified 'partnership' as the core challenge for the VC industry. He said, "There was no gap in technology or people between Silicon Valley and Korea. The problem was investment finance, contract structure, and the culture of collaboration. In particular, in Korea, founders are structured as stakeholders who bear all the responsibility, making trust-based cooperation with VCs difficult."

Continued 'Trust-Based' Follow-on Investments After Early Investments in Kurly and Habit Factory

'Kurly,' which operates the fresh food delivery platform Market Kurly, is a representative example of partnership-based investment. Translink Investment began investing at the Series A stage in 2016 and has invested a total of 13.5 billion won over four rounds.

Park explained, "After the initial investment, I proposed to Kurly's management that we convert the investment contract to the Silicon Valley model. As a result, unlike the existing Korean investment practices, Kurly and Translink Investment were able to establish a horizontal contract relationship, which enabled them to attract foreign investment."

He continued, "The recent court receivership of some small and medium-sized distribution platforms was not because the companies were bad, but because investors did not provide follow-on investments. Kurly was able to continue attracting foreign investment because it had established a solid contract structure. This is why it survived even through the COVID-19 period."

The investment in 'Habit Factory' was similar. Habit Factory operates 'Signal Planner,' a non-face-to-face insurance consulting application that uses AI to compare various insurance products. Since launching the service in 2019, the cumulative number of users surpassed 1 million last year. Translink Investment has invested a total of approximately 12 billion won over five rounds to date.

Park said, "I decided to invest after noting Habit Factory's teamwork and the management's learning ability. I believe that the ability to learn new changes such as AI and for the founder to foster teamwork are the keys to a successful startup."

The AI Era: Full-Scale Expansion with AI as a Service

The investment area drawing attention recently is the service industry combined with AI. Park believes that the large language model (LLM) development race among big tech companies, including OpenAI, has shifted this year to a competition in app services utilizing LLMs.

First, the restaurant comprehensive solution startup 'ControlM' develops and operates 'RestoGenie,' which provides integrated supply chain management (SCM), customer management, staff communication, accounting, and marketing solutions.Park said, "If K-food is to expand overseas, it needs to secure an operating system that can generate profits locally, not just focus on taste. Through ControlM's services, which can raise profit margins above 20%, I expect that the high self-employment closure rate can be overcome."

Translink Investment also invested in 'PopUp Studio,' an AI-based app development platform. Park said, "This is a change similar to the launch of the App Store in 2007-2008. Just as smartphones were developed and various apps were distributed on the Apple iOS and Google Android platforms, PopUp Studio allows service planners and developers to quickly create companies as if opening a pop-up restaurant, check market reactions, and proceed to full-scale commercialization."

Translink Investment aims to create an AI SaaS fund of 30 billion won by the end of the year. Park said, "For the private capital portion, we plan to cooperate with companies. Investment is not just about money, technology, or people. We want to work with limited partners (LPs) who need our global network and insight." He added, "More investment firms that aim for global standards need to emerge. Although it is not an easy path, I want to build such an ecosystem together with VCs and LPs who share the same vision."

Heeduck Park, CEO of Translink Investment, is being interviewed on the 13th at D.CAMP in Gangnam-gu, Seoul. Photo by Jinhyung Kang