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KEY ISSUES BRIEFING
Manufacturing AI Transformation: Jeff Bezos is raising a $100 billion fund to acquire manufacturing companies in semiconductors, defense, and aerospace, then integrate physical AI technology into their operations. The fund matches the scale of Masayoshi Son's SoftBank Vision Fund and is expected to deploy capital exceeding the world's largest private equity firms for AI-based manufacturing automation.
Deep Tech Policy Expansion: Minister of SMEs and Startups Han Sung-sook announced plans to double the scale of TIPS (Tech Incubator Program for Startup), which provides government-matching R&D support following private investment. The ministry will also establish a Korean version of the Small Business Technology Transfer (STTR) program. Han pledged the government would serve as the first buyer of innovative technologies and pursue public procurement reform.
Biotech Leadership Change: Samchundang Pharmaceutical surged to second place in KOSDAQ market capitalization at 19.4 trillion won after completing its Investigational New Drug application for European Phase 1/2 clinical trials of oral insulin SCD0503. The company overtook Alteogen, now valued at 19.0 trillion won. Securities analysts are watching the potential game-changer—the world's first oral insulin development.
STARTUP NEWS
1. Bezos Pursues $100B Fund to Embed AI in Semiconductor and Defense Factories
Amazon and Blue Origin founder Jeff Bezos is raising a $100 billion fund for AI-based manufacturing automation. Bezos recently visited the Middle East and Singapore to meet with sovereign wealth funds and major asset managers, while conducting preliminary discussions with JPMorgan Chase.
Bezos launched AI startup Project Prometheus last November as co-CEO, securing $6.2 billion in initial funding. The company's valuation now stands at an estimated $30 billion. Project Prometheus is developing spatial-based models designed to overcome the limitations of large language models.
2. Minister Han: "Expanding Government Matching for Private Investment, Cross-Ministry Deep Tech Support"
Minister of SMEs and Startups Han Sung-sook announced at a dialogue with small business leaders at Cheong Wa Dae's guest house on May 20 that the ministry will double R&D support through TIPS, which provides government matching after private investment decisions.
For deep tech sectors including AI, pharmaceutical-biotech, and climate tech, the ministry will establish coordination systems with the Ministry of Science and ICT, Ministry of Health and Welfare, and Ministry of Climate, Energy and Environment. A Korean STTR program will also be created.
Additional initiatives include online export testing support, strengthened K-brand intellectual property protection, and differentiated export programs for sectors like K-beauty. The ministry will introduce a shared-growth financial index for six commercial banks and promote collaboration between large corporations and SMEs in defense, nuclear power, and climate sectors.
3. Samchundang Pharmaceutical Overtakes Alteogen for Top KOSDAQ Market Cap
Samchundang Pharmaceutical rose to second place in KOSDAQ market capitalization at 19.4 trillion won on May 20, surpassing Alteogen at 19.0 trillion won by approximately 400 billion won.
The company completed its IND filing for European Phase 1/2 trials of oral insulin SCD0503 the previous day. The drug utilizes S-PASS, a platform technology converting injectable drugs to oral formulations.
Wi Hae-ju, analyst at Korea Investment & Securities, said successful trials would bring the company closer to developing the world's first oral insulin, potentially making it a market game-changer. The company's U.S. contract for a generic version of oral Wegovy is also proceeding without disruption, drawing market attention despite external uncertainties.
4. IPO Subscription Deposit System Under Review Following Settlement Cycle Reform
Following President Lee Jae-myung's directive to shorten stock settlement cycles from T+2 to T+1, reform of the IPO subscription deposit system has emerged as a contentious issue in the financial investment industry.
Park Yong-jin, vice chairman of the Presidential Committee on Regulatory Reform, said he would examine the structure that disadvantages investors while guaranteeing profits only for securities firms during the subscription, allocation, and refund process.
Under current rules, investors must deposit 50% of subscription amounts as collateral and pay a 2,000 won fee. Refunds of unallocated deposits take two trading days, freezing funds for approximately one week. LG CNS's IPO last year attracted 21 trillion won in subscription deposits. In 2024, Democratic Party lawmaker Lee Jung-moon introduced a Capital Markets Act amendment requiring securities firms to pay investors for use of their subscription deposits.
