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Hi, welcome back

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In the previous sessions,

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we saw how difficult for the company

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to be sustainable

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and how competitive out there

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Any big company started 
from small startup

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Then they achieved the success

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and then they become big company

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They end up dominating the market,

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but it is not enough

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In order to be sustainable for a long time,

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all the big company or small company

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just focused on two different types 
of innovation at the same time

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What are they?

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Incremental innovation 
and radical innovation at the same time

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They will be very busy

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So, this fact reminds me of

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one of the very interesting stories 
of Alice in Wonderland

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Have you heard about the Red Queen effect?

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Alice in Wonderland met the Red Queen

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and the Red Queen said that,

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"here, we must run as fast as we can"

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Why?

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Just to stay in place

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You know what I mean?

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Just to stay in the place

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So, if you do not run, what happens?

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Clearly we fall behind

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Same thing happen to the businesses

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Although you start your businesses,

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although you achieve the success,

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it's not enough

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In order to stay in place,

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what are you going to do?

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You should run as fast as you can

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You should look at the innovation,

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two different types of innovation 
at the same time

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Looks like this

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Red Queen effect in the business,

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you have to keep running 
just to stay in the same places

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Because competitors keep moving

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and some competitors will kill you

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with the radical innovation

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If you do not catch up 
this dynamic trend,

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then you clearly fall behind

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and you will be disappeared

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You will go to the bankruptcy

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Because no one uses your product, 
no one uses your services

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Because your product 
and your services will be clearly outdated

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So, that's why the modern company 
in these days,

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they will ask the employees

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to think like entrepreneur,

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act like entrepreneur,

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behave like entrepreneur

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So, although you have a job 
at a big company,

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your approach is 
very similar to the entrepreneurs

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That's why this class 
is very important for you

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I want to give you widely recognized practices

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for the corporate entrepreneurship

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The first one is intrapreneurship

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We say intrapreneuring

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Second type is corporate venturing

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Kind of broad concept

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And third type is corporate venture capital

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Let's start with intrapreneurship

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Not entrepreneurship, it's intrapreneurship

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Intrapreneurship means we empower employees

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within the organization

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to act as entrepreneurs

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Although they are the waged workers,

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we ask them to think like entrepreneur, 
act like entrepreneur

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What do you mean by that?

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We ask them to identify 
the unmet consumer's need,

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identify the consumer's problem,

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and come up with a new solution,

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and test your hypothesis from the consumers,

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and receive the feedback,

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and revise your hypothesis,

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and prepare for the prototype

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to get the real feedback from the consumers

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Exactly the same as what entrepreneurs do

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Again, develop new product
services or process from

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within the companies

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For example,

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the Google's 80 to 20 rules

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Have you heard about it?

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It's very famous

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Google asks its employees

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to spend 80% of the time on their day job,

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day-to-day operation

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On the other hand,

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what about your 20% of time?

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You use 20% of your time on something new

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Whatever it is

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You just find out something 
that you are passionate about,

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and you just focus on this new area

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This is 80 to 20 rules

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It's a clear example of entrepreneurship

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Let's look at the real example with NAVER

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NAVER is number one 
search engine company in Korea,

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very similar to Google

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It's a Korean Google

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NAVER is also a very strong company

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Let's look at this picture

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In the middle,

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he is a very famous man in the world

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Do you know who he is?

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His name is Jensen Hwang,

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the founder of NVIDIA

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He became very famous right now

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And next to him,

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the guy who wears the eyeglasses 
and Korean man,

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and his name is Lee Hae-jin

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He's the founder of NAVER

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Lee Hae-jin was an employee

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at Samsung SDS

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after graduation from KAIST

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And then he majored in 
engineering at KAIST

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Then he got a job at Samsung SDS

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Then what happened in Samsung SDS?

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Lee Hae-jin developed some new idea,

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which is Webglider

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Webglider is early version of search engine

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And he made his own team 
inside the Samsung SDS

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And Samsung SDS supported his idea

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So he made this project successful

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So the Samsung SDS was impressed,

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and then, let him go out there,

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and Samsung SDS invested the money 
into the new businesses

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Again, the new project, 
the new project team was

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spun off from the Samsung SDS

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And then this team

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became the independent company, 
which is NAVER

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Look at this picture

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This is the early version of NAVER

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So inside NAVER, from the beginning,

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there is a kind of entrepreneurial mindset

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We say it is intrapreneurship

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And the founder of NAVER

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is a person who experienced 
intrapreneurship at Samsung SDS

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So after making this Webglider team

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independent company NAVER,

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he encouraged his employees to

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think like entrepreneurs,
to act like entrepreneurs

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LINE is the clear example 
of intrapreneurship

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LINE is Japanese dominant messenger application

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But originally, 
LINE was developed by NAVER teams

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Did you know that?

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Actually, NAVER Japan

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developed LINE services

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It happened after the 2011

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Great East Japan earthquake

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In order to respond to this natural disaster,

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LINE Japan, assembled 
a small and agile team

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and asked them to rapidly build on

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new types of messenger services

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This is LINE

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Then later, what happened?

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NAVER empowered the LINE team 
with significant autonomy,

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allowing them to make a fast decision

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Then what happened?

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LINE achieved explosive growth,

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reaching millions of users in Japan

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and across Asia 
within a short period of time

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Later in 2016,

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LINE went to the New York Stock Exchange

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and also the Tokyo Stock Exchange

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Huge success

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because of the intrapreneurship

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What about Papago?

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Have you heard about Papago?

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Papago is an AI machine translation service

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At that time, we had the Google translations,

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but the Google translation is 
a little bit different from Korean language

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And many Korean people found 
the existing tool unnatural, inaccurate,

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or hard to use in daily life,

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such as the Google translation service

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So, NAVER decided to solve this pain point

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by developing its own AI-powered translator

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This is the starting point of Papago

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Many teams inside NAVER

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were involved in the Papago project

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For example, NAVER Labs and Clover Teams,

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NAVER Searches, UI, and mobile platform teams

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And so many teams collaborated together

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All the teams involved in the Papago project

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acted like the entrepreneurs

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So, they made it happen

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This is a classical example of intrapreneurship

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So, remember,

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the intrapreneurship 
is one of the widely recognized practices

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Let's move on to another type

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and another practice of 
corporate entrepreneurship

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The next widely recognized practice

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of corporate entrepreneurship is

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corporate venturing

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So, the corporate venturing refers to

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entrepreneurial activities,

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either by making new businesses inside

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or investing new business outside

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In order to invest new business outside,

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we should have some specialized organization

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We say it is an 
in-house incubator or accelerator

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Then, another one is 
we can develop our new businesses inside

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Then, if these businesses achieve the success,

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then these businesses 
can spawn off our original company

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It is called a spin-off

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The best example of the spin-off
is GE Healthcare

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GE Healthcare was developed in-house of GE

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Later on, GE Healthcare 
was spun off from GE

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Later, this company became 
the independent company,

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totally separated from GE

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Of course, GE invested the money 
and got the equity stake

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This is the relationship

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Let's look at the spin-off case first

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NAVER again

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Have you heard about Camp Mobile?

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Camp Mobile is a kind of a NAVER project

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NAVER recognized the urgent need 
to adapt the mobile revolution

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Traditionally, NAVER is a web-based business

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After 2010, what happened?

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So many people used the mobile phone

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So, NAVER recognized

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the emergence of a mobile environment

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And then, NAVER got a response 
to this fast-changing environment

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So, that's why NAVER set up 
CAMP27

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to serve as a mobile task forces

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Mobile task forces to respond 
to the fast-growing industry

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In 2012, the NAVER prepared for

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the independent space located on

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the top of the building of the NAVER headquarters

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Basically, they prepared for 
new types of area

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and asked employees to get together

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and develop some kind of ideas

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to respond to the mobile area, 
mobile industry

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So, in the new space,

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the project team gathered together, 
and they did some experiment

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And they developed some new idea,

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and they prepared for the prototype

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to respond to the mobile environment

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And they tried to develop
new types of mobile applications

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Their mobile applications

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are totally separate from NAVER's core businesses

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And they target to the global market,

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and they target to 
the totally separated business area,

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which is mobile

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From doing so,

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they ended up producing

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a great mobile application, 
which is NAVER Band

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NAVER Band is 
a group social networking application

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It became a notable achievement

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And this could be the flagship product

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of the CAMP27 project

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So, the CAMP27 project

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was spun off from the NAVER in 2013

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because of the huge success of NAVER Band

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Then, CAMP27 changed its name

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to Camp Mobile

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So, after that, Camp Mobile 
operated several successful applications,

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such as SNOW, Whosecall, WatchMaster, etc.

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NAVER continually invested in 
Camp Mobile up to

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about 100 million dollars

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Which is a huge investment 
on the Camp Mobile

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So, thanks to the investment 
from the NAVER

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and their effort-like entrepreneurship,

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Camp Mobile successfully produced

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great services, great mobile application

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One of them is SNOW

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You know the SNOW?

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SNOW is a mobile camera application,

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featuring filters and animated stickers

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The Camp Mobile produced it in 2015

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And then, the SNOW app 
quickly gained the attractions

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Especially among 
the younger users in Asian countries

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Then, what happened?

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00:15:35.200 --> 00:15:39.600
SNOW was also spun off from 
the Camp Mobile

277
00:15:39.600 --> 00:15:42.600
to become an independent company in 2016

278
00:15:42.600 --> 00:15:44.350
Think about this

279
00:15:44.350 --> 00:15:47.300
There is the CAMP27,

280
00:15:47.300 --> 00:15:50.300
which is an internal project inside NAVER

281
00:15:50.300 --> 00:15:55.150
And CAMP27 produced 
a really good service, which is NAVER Band

282
00:15:55.150 --> 00:15:57.900
And thanks to the success of NAVER Band,

283
00:15:57.900 --> 00:16:02.450
CAMP27 was spun off from NAVER,

284
00:16:02.450 --> 00:16:06.100
and they changed the name 
from CAMP27 to Camp Mobile

285
00:16:06.100 --> 00:16:09.850
And then, Camp Mobile received 
a lot of money from the NAVER

286
00:16:09.850 --> 00:16:13.650
And then, Camp Mobile produced 
really good mobile application

287
00:16:13.650 --> 00:16:15.850
One of them is SNOW

288
00:16:15.850 --> 00:16:19.850
And then, SNOW was also spun off

289
00:16:19.850 --> 00:16:24.450
Camp Mobile to become 
an independent company in 2016

290
00:16:24.450 --> 00:16:26.050
I think, of course,

291
00:16:26.050 --> 00:16:29.250
SNOW Mobile invested 
a lot of money into the SNOW

292
00:16:29.850 --> 00:16:33.400
And to get the equity stake

293
00:16:33.400 --> 00:16:34.900
Then, later, what happened?

294
00:16:34.900 --> 00:16:40.300
Camp Mobile was merged 
back into NAVER in 2018,

295
00:16:40.300 --> 00:16:42.350
which is after five years

296
00:16:42.350 --> 00:16:47.350
from its first independent company

297
00:16:48.600 --> 00:16:52.100
So, this merger allowed NAVER

298
00:16:52.100 --> 00:16:55.200
to unify its mobile strategies

299
00:16:55.950 --> 00:17:01.300
This is a story of the NAVER's 
notable spin-off cases

300
00:17:01.950 --> 00:17:04.400
So, now you understand 
what spin-off is

301
00:17:04.400 --> 00:17:06.400
What is the relationship between

302
00:17:06.400 --> 00:17:09.500
entrepreneurship and corporate venturing

303
00:17:09.500 --> 00:17:12.700
Let's move on to

304
00:17:12.700 --> 00:17:15.000
another type of corporate venturing

305
00:17:15.000 --> 00:17:17.600
This is an in-house accelerator

306
00:17:18.700 --> 00:17:23.350
In order to invest outside the startup,

307
00:17:23.350 --> 00:17:26.350
we need to have a specialized organization,

308
00:17:26.350 --> 00:17:27.700
an in-house company

309
00:17:28.150 --> 00:17:31.250
So, NAVER has an in-house accelerator

310
00:17:31.250 --> 00:17:37.150
The name of the in-house accelerator
is D2 Startup Factory

311
00:17:37.150 --> 00:17:39.750
D2SF, we say D2SF

312
00:17:39.750 --> 00:17:45.800
So, the D2 Startup Factory 
is an in-house accelerator firm in NAVER

313
00:17:47.350 --> 00:17:49.900
What does this organization do?

314
00:17:49.900 --> 00:17:54.950
This organization tries to select

315
00:17:54.950 --> 00:17:57.300
potential startups out there,

316
00:17:57.300 --> 00:18:00.650
educate them, and invest
the seed money to them

317
00:18:00.650 --> 00:18:04.650
Then, help them to be successful

318
00:18:05.600 --> 00:18:10.200
This in-house accelerator 
was founded in 2015,

319
00:18:10.750 --> 00:18:14.800
and D2SF is just primarily invested in

320
00:18:14.800 --> 00:18:17.600
very early stage of the entrepreneurial company

321
00:18:17.850 --> 00:18:19.350
So, the 99%

322
00:18:19.350 --> 00:18:24.650
99% of the companies 
that they invest is very early stage

323
00:18:24.650 --> 00:18:27.850
By 2025, 10 years later,
what happened?

324
00:18:27.850 --> 00:18:33.350
D2SF has invested in over 115 startups

325
00:18:34.300 --> 00:18:36.050
The amazing thing is

326
00:18:36.050 --> 00:18:40.250
D2SF achieved significant success

327
00:18:40.250 --> 00:18:41.850
For example,

328
00:18:41.850 --> 00:18:44.950
the D2SF-backed startups

329
00:18:44.950 --> 00:18:49.650
have an exceptional,
almost 99 % of survival rate

330
00:18:49.900 --> 00:18:53.100
In Korea, the survival rate is pretty low

331
00:18:53.100 --> 00:18:56.250
But D2SF-backed startups

332
00:18:56.250 --> 00:18:58.050
sustained for a long time

333
00:18:58.050 --> 00:19:00.200
This is a huge achievement,

334
00:19:00.200 --> 00:19:03.100
and one of the notable achievements is

335
00:19:03.100 --> 00:19:07.650
to invest the unicorn-level companies,

336
00:19:07.650 --> 00:19:09.700
such as Furiosa AI

337
00:19:09.700 --> 00:19:13.800
Furiosa AI is AI chip maker

338
00:19:13.800 --> 00:19:16.950
It's almost approached to 
the unicorn level,

339
00:19:16.950 --> 00:19:18.400
and look at this picture

340
00:19:18.800 --> 00:19:20.950
The man in the middle,

341
00:19:20.950 --> 00:19:23.400
he is a current president

342
00:19:23.400 --> 00:19:26.500
Before he became president,

343
00:19:26.500 --> 00:19:29.750
he visited Furiosa AI to encourage them

344
00:19:30.350 --> 00:19:33.100
So, the NAVER already 
invested in this company

345
00:19:33.850 --> 00:19:36.100
This is one of the significant achievements

346
00:19:36.700 --> 00:19:38.500
Then, look at this

347
00:19:38.700 --> 00:19:43.300
The D2SF activities

348
00:19:44.200 --> 00:19:47.600
create some synergy with the internal team,

349
00:19:47.600 --> 00:19:50.250
within the NAVER company

350
00:19:50.250 --> 00:19:51.450
For example,

351
00:19:51.450 --> 00:19:55.550
around 70 % of the portfolio companies

352
00:19:55.550 --> 00:19:59.350
are actively collaborating with NAVER

353
00:19:59.350 --> 00:20:02.350
For example, there is a logistic startup,

354
00:20:02.350 --> 00:20:07.000
TechTaka, closely collaborating 
with NAVER shipping

355
00:20:07.000 --> 00:20:10.400
NAVER shipping, same-day delivery services

356
00:20:10.400 --> 00:20:16.050
So, NAVER can leverage out 
their service together

357
00:20:16.700 --> 00:20:21.500
And also, the AI video startup VDO

358
00:20:21.500 --> 00:20:25.550
received investment from the D2SF in 2016

359
00:20:25.550 --> 00:20:26.600
Later, what happened?

360
00:20:26.600 --> 00:20:30.350
NAVER Webtoon acquired

361
00:20:30.350 --> 00:20:35.100
this D2SF back to startup VDO,

362
00:20:35.100 --> 00:20:38.200
and then, integrated this company

363
00:20:38.700 --> 00:20:41.400
So, this is a clear example

364
00:20:41.400 --> 00:20:44.950
of why D2SF,
which is an in-house accelerator,

365
00:20:44.950 --> 00:20:46.900
is important for the NAVER

366
00:20:46.900 --> 00:20:48.850
in terms of corporate venturing

367
00:20:49.500 --> 00:20:52.650
Let's move on to the last practice

368
00:20:52.650 --> 00:20:54.250
of the corporate venturing,

369
00:20:54.250 --> 00:20:56.350
which is corporate venture capital

370
00:20:57.350 --> 00:20:58.300
What is that?

371
00:20:58.300 --> 00:21:02.150
Corporate venture capital is 
a form of venture capital company,

372
00:21:02.400 --> 00:21:07.850
where the large corporations invest 
their own funds directly into

373
00:21:07.850 --> 00:21:10.950
the external startup companies

374
00:21:10.950 --> 00:21:15.550
This practice allows corporations

375
00:21:15.550 --> 00:21:17.900
to assess the new technologies

376
00:21:18.100 --> 00:21:21.250
New product or new business opportunities

377
00:21:22.100 --> 00:21:24.050
developed by the startup

378
00:21:24.050 --> 00:21:26.700
because they invest their money 
into the startup

379
00:21:27.350 --> 00:21:30.350
The best example will be 
the Google Ventures

380
00:21:30.350 --> 00:21:33.900
Google Ventures invest tons of money
into the new startup

381
00:21:33.900 --> 00:21:35.700
And what about KT Investment?

382
00:21:35.700 --> 00:21:38.100
KT Investment established,

383
00:21:41.950 --> 00:21:46.900
the telecommunication company in Korea,
KT established the KT Investment

384
00:21:46.900 --> 00:21:49.050
as a corporate venture capital arm

385
00:21:49.050 --> 00:21:50.950
And then, KT Investment

386
00:21:50.950 --> 00:21:56.100
tried to search for some potential startups

387
00:21:56.100 --> 00:22:00.050
Then, KT provided 20% of the fund

388
00:22:00.050 --> 00:22:04.600
that can be invested into the new startup

389
00:22:04.600 --> 00:22:07.800
to assess the new technology or new product

390
00:22:07.800 --> 00:22:09.400
developed by the startup

391
00:22:09.400 --> 00:22:11.300
Why?

392
00:22:11.300 --> 00:22:13.250
The reason is very clear

393
00:22:13.250 --> 00:22:16.750
Nobody want to be a victim of disruptor

394
00:22:16.750 --> 00:22:18.300
Remember that

395
00:22:18.650 --> 00:22:23.150
Let me compare the traditional 
venture capital company

396
00:22:23.150 --> 00:22:27.250
and the corporate venture capital company

397
00:22:28.800 --> 00:22:31.250
According to the source of fund,

398
00:22:31.250 --> 00:22:35.100
traditional venture capital company 
use the pooled fund from

399
00:22:35.100 --> 00:22:36.900
the multiple investors

400
00:22:36.900 --> 00:22:39.600
On the other hand, 
the corporate venture capital company

401
00:22:39.600 --> 00:22:42.200
can use the pooled fund

402
00:22:42.200 --> 00:22:44.500
and also they rely on

403
00:22:44.500 --> 00:22:48.050
a single money sources 
from the parent's company

404
00:22:48.050 --> 00:22:49.600
because they had a parent's company

405
00:22:50.550 --> 00:22:53.500
What about the main objective?

406
00:22:54.550 --> 00:22:56.400
The objective of the investment

407
00:22:56.400 --> 00:23:00.850
for the traditional VC company 
is about financial benefit

408
00:23:00.850 --> 00:23:04.300
On the other hand,
the corporate, venture capital company

409
00:23:06.550 --> 00:23:10.250
try to achieve the strategy fit between

410
00:23:10.250 --> 00:23:13.650
the startups and the parent's company

411
00:23:13.650 --> 00:23:17.250
And also, they expect the financial benefit

412
00:23:18.100 --> 00:23:20.150
So, last one is motivation

413
00:23:20.150 --> 00:23:22.200
And these two different,

414
00:23:22.200 --> 00:23:25.250
the venture capital company 
have a different motivation

415
00:23:25.350 --> 00:23:27.500
The traditional VC company

416
00:23:27.750 --> 00:23:30.850
motivated to maximize the return

417
00:23:30.850 --> 00:23:31.750
That's it

418
00:23:31.750 --> 00:23:38.100
On the other hand, 
the corporate VC is motivated

419
00:23:38.100 --> 00:23:41.100
to access to the new innovation

420
00:23:41.100 --> 00:23:42.950
and new market

421
00:23:42.950 --> 00:23:46.400
or the synergy with the parent's company

422
00:23:46.400 --> 00:23:48.000
This is the big differences

423
00:23:49.300 --> 00:23:52.550
So, anyway, corporate venture capital

424
00:23:52.550 --> 00:23:57.050
is the one of the practice of 
corporate entrepreneurship

425
00:23:57.750 --> 00:23:58.500
Look at him

426
00:23:58.500 --> 00:24:01.000
He is Lee Hye Jin,

427
00:24:01.000 --> 00:24:03.650
CEO and founder of NAVER

428
00:24:05.050 --> 00:24:06.550
And then recently,

429
00:24:06.750 --> 00:24:10.900
he announced that NAVER

430
00:24:10.900 --> 00:24:16.200
will establish a new 
corporate venture capital company

431
00:24:16.200 --> 00:24:17.800
in Silicon Valley

432
00:24:19.000 --> 00:24:19.950
Why?

433
00:24:21.350 --> 00:24:27.350
Because NAVER wants to access 
the new technology

434
00:24:27.750 --> 00:24:30.700
New technology or new innovation

435
00:24:30.700 --> 00:24:33.800
Where the new technology, 
new innovation come from?

436
00:24:34.000 --> 00:24:35.900
Mostly the Silicon Valley

437
00:24:35.900 --> 00:24:37.600
That's why they went there

438
00:24:37.850 --> 00:24:41.350
They went Silicon Valley and established

439
00:24:41.350 --> 00:24:44.250
the corporate venture capital

440
00:24:44.250 --> 00:24:48.200
to invest a newly developed startup

441
00:24:48.200 --> 00:24:51.200
to access the new technology
and new innovation

442
00:24:51.550 --> 00:24:54.650
So, the NAVER Ventures in Silicon Valley

443
00:24:54.650 --> 00:24:57.600
already made the first deal with TwelveLabs

444
00:24:57.600 --> 00:25:02.150
TwelveLabs is the AI company

445
00:25:02.150 --> 00:25:06.150
specializing in a video analysis

446
00:25:07.850 --> 00:25:10.700
Anyway, so far,

447
00:25:10.700 --> 00:25:13.350
we have discussed about 
the corporate venturing

448
00:25:13.350 --> 00:25:19.200
Real example of corporate venturing 
throughout the NAVER's practice

449
00:25:19.200 --> 00:25:25.250
Again, NAVER is a classical example 
of corporate venturing

450
00:25:25.400 --> 00:25:29.500
And now we understand
why NAVER is so strong

451
00:25:29.500 --> 00:25:31.700
in this competitive market

452
00:25:31.850 --> 00:25:34.050
There is a Google out there

453
00:25:34.050 --> 00:25:35.500
There is a Chinese company out there

454
00:25:35.500 --> 00:25:37.300
There is a Japanese company out there

455
00:25:37.300 --> 00:25:39.950
So competitive in Korean market

456
00:25:39.950 --> 00:25:43.600
and in website or in the search engine,

457
00:25:43.600 --> 00:25:45.050
whatever it is,

458
00:25:45.050 --> 00:25:45.900
so competitive

459
00:25:45.900 --> 00:25:51.600
But NAVER did not lose any
market leadership in Korea

460
00:25:52.450 --> 00:25:54.400
It is not because of the luck,

461
00:25:54.600 --> 00:25:56.700
but because of their effort,

462
00:25:57.500 --> 00:26:00.500
In order to assess
new technology all the time

463
00:26:00.500 --> 00:26:02.950
In order to asess new businesses

464
00:26:03.700 --> 00:26:05.050
New opportunities

465
00:26:06.200 --> 00:26:09.450
In order not to be a victim of disruptors

466
00:26:09.850 --> 00:26:13.300
Remember the Red Queen effect

467
00:26:13.300 --> 00:26:17.550
And also we should think like entrepreneur,

468
00:26:17.550 --> 00:26:18.800
act like entrepreneur

469
00:26:19.200 --> 00:26:20.950
Even if we have a job

470
00:26:20.950 --> 00:26:23.450
at a big company like a NAVER

471
00:26:24.600 --> 00:26:29.600
Don't underestimate the importance 
of the entrepreneurial mindset

472
00:26:30.500 --> 00:26:34.500
Wherever you are, it is very important

473
00:26:34.850 --> 00:26:36.495
Thank you for listening