NPX Capital is changing the way venture capital operates. Korean VC firms are known to fund tech startups for a percentage of the equity in the hope of getting 100x returns with an IPO within 5-10 years. If these VCs got lucky, they would get 2-3 startups to that point. However, times have changed in Korea. Many Korean VC firms are reluctant to invest in startups in Korea because of the difficulty of getting that kind of return. Many of the risk-taking VCs are in Silicon Valley. Korean investors have become very risk-averse who want to see sales, revenue, and growth before any kind of investment is made. Today, it is tough for an entrepreneur in Korea to raise funding. NPX Captial is an alternative investment firm for entrepreneurs not just in Korea but around the world who are looking to get the seed funding they need to grow.
An Alternative Investment Firm – NPX Capital
NPX Captial was launched in 2016 as a family office and in a little over 3 years has become an alternative investment firm that supports entrepreneurs through all stages of growth, from seed/early-stage to buyouts globally. Their office is located inside Lotte Tower which is less than 15 minutes away from Gangnam. They invest mainly in entrepreneurs that are passionate about using technology to solve global problems. There are many global problems that can be solved using technology. These include education, healthcare, the future of work, and more. NPX Capital’s portfolio companies fall in line with this mission.
NPX Capital aims to change the VC landscape in Korea. South Korea has money. There are investors, accelerator/incubator programs, government grants, angels, VC firms, and rich old-generation Koreans who want to be at the forefront of new technologies. The Korean startup ecosystem has grown tremendously over the last decade. During the startup boom in Korea in 2010, entrepreneurs in Korea just needed a pitch deck, a solid business plan, and a strong team and they could raise a $1 billion won seed round. That was not unheard of at the time. Many Korean startups ended up becoming unicorns and now these founders were looking to change how VC firms operated.
Get Early Stage Funding in Korea through NPX Capital
What separates NPX Capital from other VC firms in Korea is that they focus on international expansion. They help startups unlock new customers and revenue opportunities in countries such as Singapore, Hong Kong, and the United States. The partners at NPX Captial have decades of experience across Asia and the U.S. to help startups in Korea realize their global vision. They understand entrepreneurs in Korea because they were once entrepreneurs themselves. They are seasoned Entrepreneurs who have become investors. Therefore they have experience in starting, running, and exiting great companies is irreplaceable when it comes to helping founders do the same.
Entrepreneurs in Korea might have innovative ideas but these ideas alone will not be enough to get funding. Silicon Valley is not an option for Korean startups. Not only because of the distance but because startups from all around the world are moving to San Francisco because that is where most of the money is. The competition is fierce because the capital is so high there. In addition, there is a language barrier for many startups in Korea and they just don’t have the confidence to pitch to a non-Korean investor. NPX Capital has been able to successfully take Korean startups to Silicon Valley and Southeast Asia to raise funds. They continuously add value by leveraging its global network and know-how. They understand that it takes time to build companies whose products resonate with not just Koreans but with people all around the world.
Venture Capital and Private Equity – NPX Capital
NPX Capital does both Venture Capital and Private Equity. Both are terms used to describe a type of investment into a privately held company. They don’t invest in public companies you can find on the New York Stock Exchange and NASDAQ or in the case of Korea, KOSDAQ. They focus on both Venture Captial and Private Equity equally. Private Equity investments are investments in established companies. Companies that have been around for years and usually have positive cash flows. They have proven concepts and solid financial statements with little risk but also slow growth. They invest in Korean companies that have found success in Korea and are now looking to expand overseas.
But thankfully for startups in Korea, they also focus a lot on Venture Captial which deals with startups that have innovative new ideas. While their futures are less certain, they have the potential for rapid growth and a high return on investment (10x). Therefore these investments come with high risk. However NPX Capital has been able to maintain an 8.5x return to date. The total valuation of their portfolio companies stands at $110 million. They do both seed funding and Series A rounds for startups with exceptional founders. They also invest opportunistically in growth-stage startups looking to take their companies to the next level.
“We are actively involved in the startup community in Seoul investing in and advising many startups and founders of various businesses,” said the CEO of NPX Capital, Samuel Hwang.
Some of their exits include:
NPX Capital invests in many industries and is interested in having access to a diversity of perspectives. They understand that this is critical to good decision-making. Their team comes from different backgrounds such as banking, art curation, and media production. Every member has a voice that is different from a traditional VC firm in Korea where it seems more like a dictatorship than a productive environment that embraces debate.
Their Core Values
- Integrity – Knowing and doing the right thing, no matter what
- Collaboration – The whole is greater than the sum of its parts
- Empathy – Seeking first to understand, and then to be understood
- Transparency – Trust and alignment through open and clear communications
- Service – Leadership through service to our partners and each other
- Loyalty – Standing by each other, especially during the most difficult times
Introducing TeraArk
NPX Captial has an in-house education company building program called TeraArk. They leverage their experience as entrepreneurs to set up founding teams and match them with business opportunities. They oversee the building and operation of startups. We typically own 20-100% of these companies. Think of this as the ultimate incubator program. It is an education-focused venture studio that incubated ideas to form market-leading companies alongside their founders. Their aim is all about empowering entrepreneurs but working with them to build regionally focused education companies.
They find innovative opportunities that provide the greatest impact on society by studying regional needs and where NPX Capital can add value. NPX Capital already has a massive network and resources to put the right team together. They have years of experience building an entire network of entrepreneurs who have similar visions and can provide useful insights and resources to ensure greater success. Think of a K-pop entertainment company that creates the next big K-pop group but for Education startups. NPX Capital has the infrastructure and a proven operational ability to propel startups into leading market positions.
Helping Korean Startups go Global
NPX Capital looks at hundreds of startups per year. They don’t just focus on Korean startups, but all startups that have looks for startups interesting technology or a novel product or service that have passionate founders who want to continue to grow their company while maintaining ownership. Their team does a deep dive into around 20 per year. They look to see if they can bring real value to these companies to help them grow. They are looking to create an alternative venture capital model in Korea. The team is hard at work on creating new methods and models to become the first movers in Korea for helping Korean startups go global and create a new founder/investor relationship that is stable and can last for many years to come.
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