Super-rich Koreans eye unlisted technology stocks for investment

[Image source: Gettyimagesbank]

Super-rich individuals in South Korea with 1 billion won ($759,705) or more in deposit assets are aggressively investing in unlisted future companies in sectors, such as artificial intelligence (AI) and space development, which were previously exclusive to institutional investors.

According to an analysis by Maeil Business Newspaper last week on the super-rich individuals, the number of customers that have 1 billion won or more in deposit assets with the country’s top five securities firms reached 54,000. Their combined financial assets amounted to 320 trillion won.

The super-wealthy individuals that have seen their assets grow recently are investing in unlisted future companies at home and abroad, the analysis showed. They are also engaged in an investment strategy that involves large-scale merger and acquisition deals, just like institutional investors.

According to multiple sources from the financial investment industry, individual investors, including the super-rich individuals, invested more than 50 billion won in the recent 600 billion won fundraising of KT Cloud, an unlisted subsidiary of KT Corp.

Each investor was able to invest up to 10 billion won. Rumors say that the investment amount exceedee the available quota.

“There is a strong interest among large-scale investors in AI study amid the ChatGPT frenzy this year,” said an unnamed official from Samsung Securities Co. “There is great interest in KT Cloud given that the internet data center and cloud are the core of AI.”

An unnamed industry official noted that super-rich individuals in Singapore with trillions of won in assets hire experts to personally operate family offices.

“Super-rich individuals have seen a sharp rise in their assets in recent years and they are interested in private deals,” the official said.

Data from global investment bank UBS Group AG showed that private equity accounted for 19 percent of the entire global alternative investment assets as of the end of 2022.

The investment bank noted that family offices of high-asset holders are expanding investments in private investment funds and private debt investments. Financial investment industry, in the meantime, is also seeking to attract funds of super-rich individuals.

“Retail funds are regarded as a funding source that should be attracted together for investment,” said Park Chan-woo, chief executive officer of IMM Credit & Solutions. “The funds are suitable for long-term investments and have investment stability.”