As a senior investment manager at LB Investment, one of the country’s leading venture capital firms, Matthew has been at the forefront of funding everything from K-pop companies to AI startups. In this conversation, he talks about what it’s like working in Korea’s fast-moving VC landscape, how the team backed Hybe before BTS was even formed, and why the country’s IPO-driven culture shapes so much of how investments are made.
Charlie Bernos: So, Matthew, thank you so much for your time today. We can start this interview by you telling me who you are, what you do.
Matthew Jung: Right. So my name is Matthew Jung. I joined LB Investment since January of 2020, and I am a senior investment manager. Primarily, I invest in K-contents (K-pop, K dramas & others) and, I also invest in artificial intelligence as well. These are the main sectors that that I look responsible for, but we are open to all industries.
Charlie Bernos: Can you share more information about LB Investment?
Matthew Jung: We are one of the top 10 venture capitals based in South Korea. Our founder is Brian Ku, a Cornell graduate related to the family that owns LG, one of the world’s most important company in electronics. Originally, we started operations under the name of LG Investments, but later we spun off and became a separate entity as LB Investment.
Charlie Bernos: Can you mention any noticeable investments in the VC ecosystem made by LB. Investment?
Matthew Jung: Every year we invest at least US$ 200 million at a company level. The most notable investment would be Hybe, an entertainment company that built the K-pop phenomenon, which manages BTS. The company invested like US$ 5 million on Hybe before BTS was formed. The return we got was over US$ 200 million, and we had an active role in supporting the company as we introduced them to global investors in China and the US market. In this way, they got more exposure to the global fans and were able to capture higher growth opportunities.
Charlie Bernos: How has the Korean venture capital ecosystem performed in the past years?
Matthew Jung: The overall trends in Korea’s venture capital market have closely mirrored those in the U.S. financial and VC markets. Both have experienced similar cycles of growth and contraction. Over the past several years, the total volume of investment in Korea has been steadily increasing. However, we observed a notable decline from record highs in 2021, largely due to the post-COVID correction. Fortunately, in 2024, the market is showing some signs of recovery, particularly in terms of investment volume. When we look more closely at the Korean VC landscape, two key observations emerge. First, Korea’s IPO market is among the most active globally. One unique aspect of it is the availability of “special listings” that allow startups to go public based on technological differentiation alone, without requiring profitability. This contrasts with countries like the U.S., where revenue and profit thresholds must typically be met to qualify for an IPO. As a result of these special listings, the number of IPOs in Korea surged—reaching approximately 120 companies in 2024 alone. This accessibility has motivated many startups to pursue IPOs as a primary exit route, which is also the preferred exit strategy for venture capital firms in the region.
Charlie Bernos: And what about the industries that VCs are investing into?
Matthew Jung: The sectors attracting venture capital investment in Korea are fairly diverse. In many ways, the trends mirror those in the U.S. Over the past three years, artificial intelligence (AI) has been one of the most active and attractive sectors for investment. However, in Korea, biotechnology and medical devices also represent significant areas of focus. One reason for this emphasis on biotech is its alignment with Korea’s special IPO listing system. Many biotech startups are technology-driven and research-based. They often propose that, within a specific timeframe, their technology will reach a level of maturity that justifies going public. Because of this, they tend to target these special listings that do not require profitability. As a result, a substantial number of venture capital firms have invested in these types of companies. In addition to AI and biotech, content-related businesses are a strong focus in Korea. The Korean content industry—encompassing K-pop, K-dramas, and other cultural exports—is highly differentiated compared to other regions. It ranks as the third or fourth most targeted sector among Korean VCs. Recently, in 2024 and looking ahead to 2025, we are seeing an increased interest in manufacturing-based companies. This shift is largely driven by a greater emphasis on financial performance, especially among companies preparing for traditional IPOs that require meeting revenue and profit benchmarks. These manufacturing firms typically operate in sectors where Korea has global strength—semiconductors and automobiles, for example. So, if I were to rank them today: AI remains the most popular sector, followed by biotech, then content. But overall, the sector that is gaining the most appreciation recently is manufacturing, due to its solid financial fundamentals and alignment with current IPO expectations.
Charlie Bernos: And what about the the Korean unicorns?
Matthew Jung: If we focus on Hibe, it is valuated around $10 billion, placing it well beyond the unicorn threshold. From what I know, there have been 24 unicorns identified in South Korea so far, and we expect more to emerge in the coming years. One of our own portfolio companies, LivsMed, is a great example. It is a medical robotics company currently preparing for an IPO within the next two months in South Korea. LivsMed is valued at around US$ 1 billion, so it technically qualifies as a unicorn. To give you a reference, think of the U.S.-based Intuitive Surgical and its da Vinci surgical robot. LivsMed has developed a Korean version of that—a robotic surgical system equipped with tools like scissors and grippers used for abdominal procedures. It is one of the most promising unicorns we are seeing this year. Another company on track to become a unicorn is SemiFive, a semiconductor design platform. Given Korea’s strength in semiconductors, we expect more unicorns to emerge from this sector, as well as from the broader biotech space, within the next three years. Interestingly, while AI is currently one of the hottest sectors in terms of investment interest, I believe it will take longer for a true unicorn to emerge from the AI space in Korea. This is somewhat ironic, considering how much attention and funding AI is receiving. However, the maturity and commercial viability of AI startups may still need time before they reach unicorn status.
Charlie Bernos: I completely agree with you. There are so many AI projects out there right now that it is hard to identify which ones will truly generate significant value. The supply of AI companies is incredibly high these days, which makes things very different—and more challenging—for investors.
Matthew Jung: Right.
Charlie Bernos: On another note, in your career have you participated, or have you been involved in any company exit?
Matthew Jung: Before joining LB Investment, I worked at another venture capital firm where I had the opportunity to be involved in several exits. Since joining LB, I have not yet experienced an exit, but I can certainly share insights from my previous experience. Exits are a crucial part of venture capital, especially in South Korea, where they serve as a key motivator. One of the primary incentives for venture capitalists here is the bonus tied to successful exits—typically around 3% of the profits generated from an investment. The expected return multiple is usually around 3.5x. So, for example, if we invest $5 million, we will generally aim for a return of $16 million. From that return, the individual who sourced and led the deal would earn about 3% as a performance bonus. Naturally, this serves as a strong incentive for VCs. In terms of exit strategies, IPOs are the dominant route in South Korea, unlike in the U.S., where M&A activity plays a much larger role. I am not entirely sure why M&A is less active here, but IPOs are undoubtedly the primary method of exit for Korean VCs.
Charlie Bernos: What challenges are to be considered in the Korean VC ecosystem?
Matthew Jung: One of the key challenges in the Korean venture capital ecosystem is the need to diversify exit strategies beyond the domestic IPO market. Currently, there is a heavy reliance on Korea’s special listing system, which allows companies to go public without meeting traditional financial performance requirements. While this has facilitated access to capital markets, it has also introduced risks, particularly when companies fail to deliver on their growth projections post-IPO. To ensure more sustainable outcomes, Korean VCs should look beyond these special listings and explore exits in other regions, especially in the U.S., where M&A activity and traditional IPOs play a larger role. Diversifying geographically and methodologically will be important for long-term success. Another major area of concern is the overconcentration of investments in artificial intelligence. Although AI is currently one of the most heavily funded sectors, I believe we will have to wait longer to see successful unicorns emerge in this space—particularly in Korea. One of the main reasons is that, at a national level, Korea still lacks the same level of capabilities, technological infrastructure, and talent pool that exists in the U.S.