SM Culture Partners

SM Culture Partners (Korean: 에스엠컬쳐파트너스; SMCP) is a South Korean venture capital company wholly owned by SM Entertainment. The company serves as the technology business financier that would be involved in venture investment of culture- and tech-related companies through indirect investments.

SM Culture Partners
Native name
에스엠컬쳐파트너스
TypeSubsidiary
IndustryVenture capital
FoundedMarch 15, 2022 (2022-03-15)
Headquarters
South Korea
Key people
Jang Jae-ho (CSO)
OwnerSM Entertainment (100%)
Websitesmculturepartners.com

History

SM Entertainment had its first venture investment move when it invested 18 billion won in the new technology business finance association, TechNext Investment Association No. 1, formed by Accelerator (AC) Future Play in 2018. The move was characterized by creating only "pure" private funds without policy funds for free overseas investment, which made Future Play serve as a tech advisor to SM.[1] SM's past investments have been criticized for persistent losses and low business relevance and has planned to set up a "specialized" investment company and start to "discover new growth engines."[2] SM once established a venture company that jumped back into private equity investment after withdrawal. In 2012, SM participated as a "strategic" investor and established SM Contents Investment with a capital of five billion won, but later sold its stake to Party Games in 2017.[3]

According to industry insiders, by March 31, 2022, SM had established SM Culture Partners, a corporate venture capital firm, on March 15. The company is a 100% subsidiary of SM and was able to increase its capital to 30 billion won upon being registered as a new company. It would be considered a new technology business financier and would be involved in venture investment through indirect investment. Jang Jae-ho was appointed as the chief strategy officer (CSO) of the company. It was stated that the company was expected to focus on finding and investing in culture- and tech-related companies.[4]

Lee Sung-soo and Tak Young-jun were named as inside directors of SM Culture Partners. On May 26, 2022, Park Seong-ho, a founding member of Korea Growth Finance Investment Management (K-Growth), joined the company as vice president and was expected to accelerate the process of acquiring a license for the "new technology" business finance company.[3] By August 5, Park Joon-hyung, head of the Korea Venture Investment, was recruited and joined as a director of SM Culture Partners. He also served as the team leader at the fund management headquarters, which is responsible for the investment business and sub-fund management at Korea Venture Investment. With the two Parks joining the company, SM Culture Partners have secured both Korean Venture Investment and K-Growth personnel, which are two major local investment institutions in South Korea.[5]

Investments

On March 29, 2022, Munhwa Broadcasting Corporation (MBC) announced that it would invest in Koy Labs, a Korean language education start-up, along with SM Culture Partners.[6] The company selected Koy Labs as its first investment destination after recognizing the need for "easy and fun" Korean language education.[7] An official from the company stated that they participated in investment in "anticipation of the effect of spreading the Korean language to the global market" expanding the fandom of SM's artists and communication with fans.[8] Both MBC and SM Entertainment Group plan to collaborate and grow Koy Labs into a global service.[9] Koy Labs intended to launch official services using the intellectual property (IP) of MBC and SM in the United States and Southeast Asian markets.[10]

On June 28, 2022, SM Culture Partners and Aventures, participated in an investment for Photo Widget, an iOS-only service that provides themes and widget functions.[11] The service has attracted a series A investment of 3.5 billion won from SM Entertainment Group and 1 billion won from Aventures with a cumulative investment amount of 4.5 billion won.[12][13] With the investment, Photo Widget has planned to expand various collaborations by using SM's IP.[14] On February 23, 2023, MineIs, a start-up that operates the used fashion shopping service, Charan, garnered 4.15 billion won in seed investment.[15] SM Culture Partners, along with Goodwater Capital, CJ Logistics, T-Investment, Schmidt, and SparkLabs are among those who participated in the investment.[16]

Programs

On May 15, 2023, SM Culture Partners and CNT Tech announced their recruitment for Culturetech Challenge. The program is set to "discover and support" culture-tech startups that have the prospect to produce "new" value by combining culture and technology.[17] It will include metahuman solutions that support the production and activities of virtual artists, new content technology that allows more efficient content creation, and metaverse interaction that creates a virtual space where fans and artists can communicate without time and space constraints.[18] Startups selected through the screening are provided with close accelerating programs such as market verification, mentoring, proof of concept (PoC) with SMCP and SM Entertainment, and demo days for five months, along with opportunities to draw investments of over 100 million won.[19] An SMCP official said that the program would reflect the company's direction to "increase and grow the value" of the local cultural industry with startups.[20]

References
  1. Kim, Gun-woo; Kim, Tae-hyun (March 8, 2022). [단독]SM엔터, 퓨처플레이 전격 지분투자…메타버스·NFT 키운다 [[Exclusive] SM Entertainment, Makes a Sudden Stake Investment in Future Play…Growing Metaverse and NFTs]. Money Today (in Korean). Archived from the original on March 8, 2022. Retrieved March 15, 2022.
  2. Lee, Sang-eun (May 16, 2022). 믿을건 엔데믹 아닌 사업 다각화?…격변기 맞은 韓 엔터사 [Diversification of Businesses, Not an Endemic, to believe?…Korean Entertainment in a Cataclysmic Change]. Invest Chosun (in Korean). Archived from the original on May 16, 2022. Retrieved August 16, 2023.
  3. Lee, Yoon-jung (May 26, 2022). 박성호 성장금융 팀장, SM컬처파트너스 부사장으로 [Park Seong-ho, Head of Growth Finance Team, Is Vice President of SM Culture Partners]. The Bell (in Korean). Archived from the original on August 16, 2023. Retrieved August 16, 2023.
  4. Lee, Jong-hye (March 31, 2022). SM엔터, 신기사 형태 'SM컬처파트너스' 설립 [SM Entertainment, Established 'SM Culture Partners' in the Form of a New Company]. The Bell (in Korean). Archived from the original on August 8, 2022. Retrieved August 15, 2023.
  5. Lee, Yoon-jung (August 5, 2022). SM컬처, 모태 박준형 팀장 영입…LP인력 대거 포진 [SM Culture, Recruited Team Leader Park Joon-hyung…Large Numbers of LP Manpower]. The Bell (in Korean). Archived from the original on August 17, 2023. Retrieved August 17, 2023.
  6. Kang, Bo-ra (March 29, 2022). MBC·SM, 한국어 교육 사업…에듀테크 '코이랩스' 투자 [MBC and SM, Korean Language Education Business…EduTech Investment in 'Koi Labs']. Single List (in Korean). Archived from the original on August 15, 2023. Retrieved August 15, 2023.
  7. Yeon, Hwi-sun (March 29, 2022). MBC·SM 손잡았다, K콘텐츠 인기 '한국어 교육'까지? 스타트업 코이랩스 투자 [공식] [MBC and SM Joined Hands, Including the Popular K-content 'Korean Language Education?' Startup Koi Labs Investment [Official]]. Osen (in Korean). Archived from the original on August 15, 2023. Retrieved August 15, 2023.
  8. Jin, Hyang-hee (March 29, 2022). MBC-SM, 한국어 교육 사업 위해 뭉쳤다 [MBC-SM, Joins Forces for Korean Language Education Business]. StarToday (in Korean). Archived from the original on August 15, 2023. Retrieved August 15, 2023.
  9. MBC·SM, 한국어 교육 사업 위해 맞손…에듀테크 스타트업 '코이랩스' 투자 [MBC and SM, Joined Hands for the Korean Language Education Business…EduTech Startup 'Koi Labs' Investment]. iMBC Entertainment (in Korean). March 29, 2022. Archived from the original on August 15, 2023. Retrieved August 15, 2023.
  10. Lee, Mi-young (March 29, 2022). MBC-SM, 한국어 교육 사업 위해 맞손…코이랩스 투자 [MBC-SM, Join Hands for Korean Language Education Business…Investment in Koi Labs]. JoyNews24 (in Korean). Archived from the original on March 29, 2022. Retrieved August 15, 2023.
  11. Kim, Mun-seon (June 28, 2022). 글로벌 모바일 라이프 플랫폼 '포토위젯', 35억 규모 시리즈A 투자 유치 [Global Mobile Life Platform 'Photo Widget', Attracts 3.5 Billion Series A Investment]. Platum (in Korean). Archived from the original on July 14, 2022. Retrieved August 17, 2023.
  12. Min, Dan-bi (July 25, 2023). 포토위젯, 중소벤처기업청 여성기업 인증 획득 [Photo Widget, Acquires Women's Enterprise Certification by Small and Medium Venture Business Administration]. Dailian (in Korean). Archived from the original on August 18, 2023. Retrieved August 18, 2023.
  13. Oh, Hyo-jin (June 28, 2022). 글로벌 Z세대 '포토위젯', 35억원 투자 유치 [Global Z-generation 'Photo Widget', Attracts 3.5 Billion Won in Investment]. Venture Square (in Korean). Archived from the original on August 7, 2022. Retrieved 2023-08-17.
  14. Kim, Yu-kyung (June 28, 2022). 글로벌 Z세대 플랫폼 '포토위젯' 35억 규모 시리즈A 투자 유치 [Global Z-generation Platform 'Photo Widget', Attracts 3.5 Billion Won in Series A Investment]. Money Today (in Korean). Archived from the original on September 30, 2022. Retrieved August 17, 2023.
  15. Kim, Geun-woo (February 23, 2023). '차란' 운영사 마인이스, 41.5억원 규모 시드 투자 유치 ['Charan' Operator MineIs, Attracts Seed Investment Worth 4.15 Billion Won]. Edaily (in Korean). Archived from the original on August 17, 2023. Retrieved August 17, 2023.
  16. Cho, Kwang-hyun (February 23, 2023). 중고 패션 쇼핑 서비스 운영 스타트업 '마인이스', 41.5억원 규모의 시드 투자 유치 ['MineIs', A Startup that Operates Used Fashion Shopping Services, Attracts Seed Investment Worth 4.15 Billion Won]. Maeil Business Newspaper (in Korean). Archived from the original on August 17, 2023. Retrieved August 17, 2023.
  17. Ryu, Keun-il (May 15, 2023). 씨엔티테크, SM과 손잡고 컬처테크 챌린지 1기 참여기업 모집. [CNT Tech and SM, Recruiting Companies to Participate in the 1st Culturetech Challenge.]. Electronic Times (in Korean). Archived from the original on August 18, 2023. Retrieved August 18, 2023.
  18. 씨엔티테크-SM컬처파트너스, 컬처테크 챌린지 1기 참여기업 모집 [CNT Tech-SM Culture Partners, Recruitment of Companies Participating in the 1st Culturetech Challenge]. Platum (in Korean). May 15, 2023. Archived from the original on May 15, 2023. Retrieved August 18, 2023.
  19. Oh, Hyo-jin (May 15, 2023). 씨엔티테크·SM컬처파트너스, 컬처테크 챌린지 1기 참여기업 모집 [CNT Tech and SM Culture Partners, Recruitment of Companies Participating in the 1st Culturetech Challenge]. Venture Square (in Korean). Archived from the original on August 18, 2023. Retrieved August 18, 2023.
  20. Nam, Mi-rae (May 15, 2023). 씨엔티테크, SM과 함께 K-컬처 스타트업 발굴한다 [CNT Tech, To Discover K-Culture Startups With SM]. Money Today (in Korean). Archived from the original on August 18, 2023. Retrieved August 18, 2023.
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