[Exclusive] 'Fabless Unicorn' Padu Applies for Preliminary Listing Review... How Much Is Its Corporate Value?

Technical Evaluation AA Grade... Meta and Others Aim to Enter KOSDAQ Market by Customers
Within the Second Half of This Year

FADU, the first domestic semiconductor fabless startup to become a unicorn (a private company valued at over 1 trillion KRW), has recently submitted a preliminary listing examination application to the Korea Exchange, officially beginning its initial public offering (IPO) process.

According to the Korea Exchange and FADU on the 10th, FADU will soon submit the preliminary listing examination application to the Korea Exchange. A FADU representative stated, "We plan to submit the preliminary listing examination application to the Exchange by today at the earliest, or by next week at the latest, after which it will be disclosed on the corporate disclosure channel." FADU has been preparing for the IPO since early last year by selecting NH Investment & Securities as the lead underwriter and Korea Investment & Securities as the co-underwriter, conducting a technology evaluation for the KOSDAQ special listing, and plans to complete the process within the second half of the year.

Investor interest is high regarding FADU's market entry and its valuation. Recently, FADU attracted attention by completing a pre-IPO (pre-listing equity investment) with a corporate valuation of 1.08 trillion KRW. This is because it became the first fabless startup unicorn in Korea. The company received its first investment in December 2016 from SK Infosec (now SK Shielders) and Forest Partners, with a valuation of about 54 billion KRW at that time. In just over six years, its valuation has surged nearly 20 times. Existing investors such as Withwin Investment, IBK Capital, and Forest Partners participated in this round of investment.

A FADU representative explained, "Despite the recent difficult capital market environment, especially the harsh startup funding winter, we believe that being the only domestic fabless semiconductor company designing chips that has clearly demonstrated business performance in the global market was highly valued."

Fadu's 5th Generation SSD Controller for Data Centers. Photo by Fadu

Founded in June 2015 by researchers from Seoul National University College of Engineering's 'Memory and Storage Architecture Laboratory,' FADU is a system semiconductor company specializing in data centers. Its first product line and current core business is the solid-state drive (SSD) business for data centers. FADU has developed SSD controllers for data centers and SSD product lines equipped with these controllers, securing numerous customers primarily among U.S. data centers and major big tech companies.

Leveraging strong relationships with U.S. big tech companies, FADU is expanding into various semiconductor product lines that address key data center workloads such as artificial intelligence (AI) and streaming. The company operates development teams in these areas and is conducting investment and joint development projects with North American network semiconductor companies. Based on this, FADU plans to grow into a global fabless company with sales of around 3 trillion KRW and a diverse range of data center-oriented semiconductor products by 2030.

FADU's investors expect a market capitalization of 2 trillion KRW at the time of listing. They explain that this valuation is achievable because institutional investors are giving high marks to FADU's future prospects. Major investors include Company K Partners, AJ Capital Partners, Samho Green Investment, Smilegate Investment, and Capstone Partners. An industry insider said, "Following a recent technology evaluation, FADU received excellent ratings of 'AA' and 'A' from various institutions, and if the IPO market recovers, expectations are forming that FADU's market capitalization after listing will be around 2 trillion KRW."

Investors particularly expect FADU's growth rate to accelerate further. Since last year, FADU has established a mass production system for SSD controllers, rapidly increasing sales and profits. Last year's sales reached the high 500 billion KRW range, a significant increase from 5.1 billion KRW in 2021, and it recorded an operating profit of about 4 billion KRW, turning profitable. They believe that securing a foundation for global market entry through this year's IPO will further accelerate growth. An industry official said, "FADU has been recognized for its technology by supplying enterprise SSD controllers to global big tech companies such as Meta (formerly Facebook) last year, so demand for FADU's SSD controllers in data centers worldwide is expected to continue growing," adding, "FADU is negotiating to expand its supply base not only with Meta but also with other big tech companies."

This content was produced with the assistance of AI translation services.