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Venture capital

Korea's top VC says NFTs to emerge as promising investments

Korea Investment Partners expects this year to mark the first time its returns will surpass its investment

By Aug 11, 2021 (Gmt+09:00)

Korea Investment Partners CEO Hwang Mahn-soon
Korea Investment Partners CEO Hwang Mahn-soon


Non-fungible tokens (NFT) are poised to emerge as promising investments in the era of digital transformation once the global pandemic settles down, according to Hwang Mahn-soon, the chief executive of Korea Investment Partners Co.

In an interview with The Korea Economic Daily on Aug. 11, CEO Hwang stated that the unique nature of NFTs makes them attractive investments as they tap into people's desire for exclusive ownership.

NFTs are blockchain-based tokens that each represent a unique asset such as a piece of art, digital content or media. They cannot be reproduced, altered or counterfeited, thereby giving the holder full ownership of the asset.

Earlier this year, NFTs became hot investments, especially after Twitter CEO Jack Dorsey’s successful sale of his first-ever tweet at a price over $2.9 million in March. In the same month, Tesla founder Elon Musk's girlfriend and musician Grimes sold near $6 million worth of NFTs in less than 30 minutes.

Founded in 1986, Korea Investment Partners is the country’s largest VC firm with over 3.3 trillion won ($2.8 billion) in assets under management. Hwang, who took the helm this year, currently manages a 350 billion won bio global fund which focuses on bio startups. 

But the VC isn’t just looking at the bio sector. According to Hwang, the company also has plans to invest in Healthcare (H), Online (O), Untact (U), Smart infrastructure (S) and Economy at home (E) -- the HOUSE industries.

“Currently, domestic investments account for about 55% of our portfolio with overseas investments accounting for the remaining 45%," said Hwang, adding that once the COVID-19 crisis settles down the company plans to carry out aggressive investments abroad, including in China and Southeast Asia.

LEARNING FROM THE PAST

CEO Hwang acknowledged that the market has been partially overheated recently, expressing caution over surging valuations.

“It’s desirable to see a company's valuation continue on an upward trend, but it can’t always remain at its peak. As a venture capitalist, it’s crucial to know how to hedge against the aftermath that occurs when the market goes down,” said Hwang.

CEO Hwang stated that learning from the past is essential. Last year when many VCs cut back on their investments due to the pandemic, Korea Investment Partners invested a record-high 560 billion won.

“Based on my experience, the market is bound to have volatility and I determined that last year was a good time to carry out aggressive investments and achieve good results,” Hwang said.

COOPERATION KEY TO SUCCESS

Cooperation is pivotal in the VC industry, according to Hwang, who added that startups shouldn't assume that VCs are trying to invest at lower valuations and likewise, VCs should note that they cannot survive without startups.

Hwang encouraged startups and VCs to embrace such a win-win attitude, congratulating each other for their success as the accumulated cases of positive investment are sure to benefit the overall industry.

Meanwhile, Hwang expects this year to be the first time the company's returns exceed its invested amount. Already in the first half of this year, Korea Investment Partners has invested over 300 billion won and its returns have been higher.

Write to Jong-woo Kim and Jung-hwan Hwang at jongwoo@hankyung.com

Danbee Lee edited this article.
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