LG to unveil healthcare product; open to startup M&As

South Korea’s LG Electronics Inc. is set to unveil its first digital healthcare product in the second half of this year, three years after it ventured into Silicon Valley in the hunt for up-and-coming startups in the healthcare technology segment.

The forthcoming product is being developed jointly with two US-based startups and adopts augmented reality and virtual reality technologies, said Sokwoo Rhee, head of LG North American Innovation Center (LG NOVA) in Silicon Valley.

The two unidentified startups boast technologies for measuring blood pressure with a camera and manufacturing diagnostic devices for muscular skeletal diseases.

“We are dipping our toes into areas we have never been in,” Rhee said in a virtual interview with The Korea Economic Daily on Monday.

But he gave no further details about the new healthcare product.

Healthcare is one of LG Electronics' new growth drivers. LG NOVA also plans to unveil new products related to cleantech, or environmental technologies, as well as in the mobility business.

LG NOVA was launched in December 2020, tasked with exploring new business opportunities and deepening relationships with Silicon Valley-based startups, with which LG could join hands for new product development.

 
INVESTING IN STARTUPS

Such a move indicates LG’s new approach toward business expansion.

“We’ll make maximum use of external technologies. This growth strategy differs from that of other Korean conglomerates, which have been concentrating on developing their own technologies and strengthening their internal capabilities,” said Rhee.

“If necessary, we will buy stakes (in startups), or establish joint ventures with them. Should they play a central role (for projects), we may merge with or acquire them.”

Rhee, an Internet of Things specialist, worked as associate director of the Cyber-Physical Systems Program at the National Institute of Standards and Technology (NIST) in the US between 2014 and 2021.

The innovation center is aiming to launch new businesses jointly with some 10 startups over the next four to five years. An initial investment of $20 million was earmarked for supporting such projects.

NETWORK WITH STARTUPS

A total of 3,780 ventures have joined the LG NOVA-led business network. They could be LG’s potential business partners to materialize their business ideas and new technologies within a timeframe of two to three years.

LG NOVA’s strategy has gone viral and a few Google engineers recently visited the center.

During the visit, they showed interest in LG NOVA’s business model and hinted that they could try the strategy if it proves successful, Rhee said.


The LG NOVA head added he is confident about its growth strategy, based on the technologies of startups, which seems unfamiliar to Korean companies.

“I believe that our venture into new businesses in cooperation with multiple startups, which may look like an octopus spreading tentacles, has the odds of success,” he noted.

Write to Ji-Eun Jeong at jeong@hankyung.com

Yeonhee Kim edited this article.