Tech Giants Backed by Samsung Venture Investment Corp

We have known Samsung to be an electronics and home appliance company. But did you know that Samsung has been a corporate venture capital (CVC) investor in over 170 companies in the past 22 years?

This blog discusses how Samsung Venture Investment Corp. (SVIC) has changed the tech industry. SVIC sees their potential and gives a chance to younger companies.

Let’s see how their early-stage investments inspire change.

Introduction to Samsung Venture Investment Corp

Samsung Electronics, founded in 1969 in South Korea, changed the world as we know it. Today, it is a leading electronics and appliance company.

After establishing dominance over smartphones, smart TVs, tablets, etc., they wondered what more was in store. They started raising Samsung funding for early-stage investments.

But before we get into their venture corp, let’s understand how big of an impact Samsung has made in the world.

How Big is Samsung?

As of 2022, Samsung has contributed to 22.4% of South Korea’s GDP^[1]. Yes, they are known for being one of the world’s leading phone producers.

But did you know Samsung has made a lot more contributions throughout vast (and surprising) industries?

• Electronics

• It is fascinating how augmented reality creates immersive experiences. But do you know that Samsung’s tech is so advanced that their virtual reality XR headsets now include AI capabilities?

• Deep Tech

• Samsung is serious about its technology. So much so that its affiliated groups have departments in the military and aeronautics.

• Samsung Techwin ventured into the realm of deep tech and created the SGR-A1 sentry gun for military use.

• Construction

• Other than tech, Samsung innovation brings in divisions like shipbuilding, called Samsung Heavy Industries. They are one of the largest shipbuilders in the world.

• Samsung C&T is a construction group. They are responsible for building the Burj Khalifa in Dubai and the Petronas Towers in Malaysia.

• Vehicles

• Around the 90s, Samsung partnered with Nissan and Renault to produce cars.

• Samsung has been talking about making batteries for electric vehicles.

Now that we know just how many industries and early-stage investments Samsung has dabbled in, we can look at their venture corp.

Samsung Venture Investment Corp: An Overview

Being a multinational conglomerate, it is natural that Samsung would want to extend its hand in venture investments. For a company as diverse as it is, it only makes sense that it recognises the potential of other tech startups.

So, in 1999, Samsung funding venture, SVIC, was formed in Seoul to invest in new growth markets.

Samsung’s venture investment arm’s venture capital strategy is to discover and develop new businesses and technology. Samsung innovation aims to recognise the growth potential of companies in the current rising markets and promote an open creative environment.

Key Investment Focus Areas of Samsung Ventures

SVIC has a meticulous vetting system before investing in a company. Its key investment areas include semiconductors, telecommunications, software, the internet, bioengineering, and the medical industries.

They promise funds management and technical support, along with market registrations.

SVIC looks for ethical growth along with market growth in their areas of interest for investments. Their potential VCs should comply with their in-house standards like:

• Comply with laws & ethical standards
• Maintain a clean organisational culture
• Respect customers, shareholders & employees
• Care for the environment, health & safety
• Be a socially responsible corporate citizen

If a company qualifies in SVIC’s areas of interest, it can move to the next phase: getting Samsung funding and investment.

Strategic Approach: How Samsung Identifies the Next Big Tech Players

Venture capital firms are dedicated to nurturing startups. SVIC has a thorough and strategic approach to finding its next big tech players and nurturing them.

Here’s their complete investment opportunity procedure for mid-level companies to get Samsung funding:

• Submitting Investment Request: Companies can check the requested material and submit it to SVIC.
• Company Review: SVIC will begin their initial evaluation. In this step, they evaluate the fundamental business capability of the company.
• Due Diligence: SVIC will interview the company management and core personnel. They will then review the company’s business plans.
• First Phase Evaluation: In this step, the main evaluation begins. SVIC will see how innovative the technology of the company is. During the first phase, factors like business feasibility, marketability, products & services, financial status, management, etc., are also checked.
• Second Phase Evaluation: The second phase includes evaluating the corporate value of the company and an on-site visit to the venture company.
• Final Negotiation Decision: This phase consists of the negotiation of terms and conditions of investment opportunities and making final investment decisions.
• Provide Investment Funds and Marketing Support: VCIS prepares the joint investment agreement, provides funds, and registers shareholders.

Success Stories: Impact of Samsung Ventures on the Tech Industry

Startups that were funded by VCs have incredible success stories. SVIC has invested in several ventures. Let’s take a look at a couple that made a powerful impact in the tech industry.

• Startups in India

SVIC invested $8.5 million^[2] in India in 2019. All of the four Indian startups in the Samsung portfolio are tech companies.

OSLabs (Indus OS): OSLabs received plenty of success, so much so that Samsung partnered with it to launch the new Galaxy Store. Indus App Bazaar brings app experience in 12 Indian languages.

Gnani.ai: Gnani.ai is a speech technology. Samsung invested in Gnani.ai with an interest in its automatic speech recognition engine. They want Gnani’s engine to power Samsung’s Bixby in the future.

IoT solutions provider Silvan Innovation Labs: In 2019, Silvan Innovation Labs’s products were installed in over 6,000 homes. Samsung has invested in Silvan’s products and IoT platform with a vision to get its products IoT-ready by 2020.

• SentinelOne

SentinelOne is an intelligent cybersecurity platform. It harnesses the power of data and AI to protect an organisation’s database.

Aston Martin partnered with SentinelOne for its cybersecurity.

• Oxford Semantic Technologies

This tech company has made a name for itself in the Samsung portfolio. They are an AI powered by high-performance technology.

Their AI can make autonomous decisions in various settings like boats and aircraft. Samsung recently acquired the company after seeing its success.

Future Directions and Emerging Tech Trends in Samsung Ventures

Samsung Venture Investment Corp is interested in investing in future-oriented businesses. It has made most of its investments in Series A funding.

Most of these companies have been new and innovative tech startups.

In the future, Samsung has hinted at showing more interest in semiconductors, software, and bioengineering. This might be a great opportunity for any deep tech companies who want to shoot their shot at Samsung funding from SVIC.

To Wrap it Up

Samsung has made an incredible impact in almost every single industry since 1969. Their venture capital strategy is about extending this impact through other innovative companies. They started their venture arm in 1999.

Since then, Samsung funding has concentrated on the tech industry the most. The Samsung portfolio comprises semiconductors, telecommunications, software, the internet, bioengineering, and medical industries.

Their ventures have had incredible success stories, with Samsung completely acquiring some of them.

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FAQs

1. What does Samsung invest in?

Samsung Venture Investment Corp is careful with the industries in which it invests. Their key areas of interest for investments are semiconductors, telecommunication, software, internet, bioengineering and medical industries

However, they have made their most impactful investments in the technology industry. Samsung is trying to grow and recognise the potential in upcoming investment opportunities like biotech and healthcare.

2. Who is Samsung's chief investment officer?

Kim Yi-Tae is the Chief Executive Officer and President of Samsung Venture Investment Corp. SVIC has 6 teams in their HQ investment team, with 4-6 people in each team. Hyemin Lee is the Senior Investment Manager at Samsung Venture Investment Corp.

3. How much has Samsung invested in India?

Samsung has invested $8.5 million in India in 2019.

These investments were made in four tech startups. OSLabs, Gnani.ai, and IoT Solutions by Silvan Innovation Labs reaped the benefits of these investments. Today, they have successful stories to tell, thanks to Samsung Venture.

1. 22.4% of South Korea’s GDP - Link ↑
2. $8.5 million - Link ↑