"Investment Dries Up After Going Public"... AI Companies Call for Long-Term Investment Environment

Ryu Jemyung, Vice Minister of Science and ICT, Listens to AI Startup Investment Challenges
"Absence of AI Performance Metrics... National-Level Evaluation Standards Needed"
"Need to Move Beyond Government-Led Support and Increase Private Capital Inflow"

On the 21st, the 'AI Startup Investment and Support Activation Meeting' was held at the HJ Business Center in Gwanghwamun, Seoul. Photo by Park Yujin.

Despite the fact that long-term research and development (R&D) investment is essential for the nature of the industry, domestic artificial intelligence (AI) companies have voiced concerns that the current system and investment environment are actually hindering their growth. At the 'AI Startup Investment and Support Activation Meeting' held at the HJ Business Center in Gwanghwamun, Seoul, on the 21st, companies unanimously called for the easing of investment regulations for listed companies, the establishment of AI performance measurement indicators, the creation of a culture of adventurous investment, and the expansion of a private-led investment ecosystem. They warned, "At this rate, we will inevitably fall behind in global competition."

Lee Jeongsoo, CEO of Flitto, said, "In Korea, investment dries up after a company goes public. Since venture capital (VC) firms are not allowed to invest in listed companies, investments stop once a company is listed." He added, "AI companies require long-term R&D investment, but because they need to generate immediate profits, they sometimes turn to entirely different sectors such as fashion or cosmetics." He emphasized, "Even listed companies should have restrictions eased so they can invest in R&D stably."

Hwang Taeil, CEO of Glorang, pointed out issues with evaluation standards. He said, "While existing platform companies are evaluated based on clear indicators such as customer acquisition cost (CAC), AI companies lack performance measurement metrics. The government should flexibly establish new evaluation standards at the national level."

There were also criticisms of the conservative nature of the domestic investment environment. Kim Yeonseok, CEO of Jetik AI, said, "Domestic investors insist only on 'safe investments' focused on sales. If we only work on collaborative projects with large corporations, we may generate immediate revenue, but we will fall behind in global competition." He added, "We need an investment environment that supports software-based innovation."

Industry insiders also suggested that private sector participation needs to be expanded beyond the current government-led support structure. Lee Dongwoo, Executive Director at Quantum Ventures Korea, said, "In the United States, private investment accounts for more than 60%, but in Korea, the focus is on government-led investment. We need to revitalize the KOSDAQ market and create conditions for active inflow of private capital, including foreign investment."

Ryu Jemyung, 2nd Vice Minister of Science and ICT, emphasized, "It is most important to have an investment environment where startups can freely try and take on challenges." He continued, "We need to establish a virtuous cycle of investment at the national level, with both the private and public sectors participating." He added, "The government will provide policy support so that AI startups can grow to their full potential."

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