Capital Raising - South Korea | Statista Market Forecast

The country in South Korea is projected to reach a Total Capital Raised of US$4.04bn in 2024 in the Capital Raising market market.
Traditional Capital Raising is expected to dominate the market with a projected market volume of US$3.58bn in 2024.
When compared globally, the United States is forecasted to generate the most Capital Raised at US$195.4bn in 2024.
In South Korea, the Capital Raising market is increasingly embracing innovative fintech solutions to streamline the fundraising process for companies of all sizes.

Definition:

The Capital Raising market refers to the process of raising additional capital to launch, finance, and grow a business or a project. Traditional Bank Loans are not considered in the market.

Structure:

The market consists of two segments:
- The Traditional Capital Raising market refers to traditional venture financial services for startups and emerging companies that do not yet possess a positive track record, but have exceptional growth potential.
- The Digital Capital Raising market refers to digital financial services for business customers and private borrowers.
The market data comprises of the amount of capital raised, number of deals, and average deal size.

Additional information:

Besides Traditional Bank Loans, there are various alternative forms of debt and equity financing that help businesses, especially startups and emerging companies who seek additional funds to support their business' operation and growth. Nowadays, owing to the rapid growth rate of startups and emerging companies, these financial services are more attractive and popular.
Key players in this market are companies such as Squoia Capital, Hercules Capital, and Indiegogo

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Venture Capital
Venture Debt
Digital Capital Raising

Traditional Bank Loans

The Capital Raising market in South Korea has been experiencing significant growth and development in recent years.

Customer preferences: South Korean investors have shown a strong preference for capital raising activities, particularly in the form of initial public offerings (IPOs) and bond issuances. This can be attributed to several factors, including the potential for high returns on investment and a desire to diversify their portfolios. Additionally, there is a growing interest among South Korean investors in investing in innovative and high-growth sectors such as technology and biotechnology.

Trends in the market: One of the key trends in the South Korean capital raising market is the increasing number of IPOs. Many companies, especially those in the technology and healthcare sectors, are opting to go public to raise funds for expansion and to gain access to a wider pool of investors. This trend is driven by the strong performance of the South Korean stock market and the growing interest from both domestic and international investors. Another trend in the market is the growing popularity of bond issuances. South Korean companies are increasingly turning to the bond market to raise capital, taking advantage of the low interest rate environment and the strong demand for fixed income securities. This trend is also driven by the government's efforts to promote corporate bond issuances as a means of financing for companies.

Local special circumstances: South Korea's capital raising market is influenced by several local special circumstances. One of these is the strong presence of large conglomerates, known as chaebols, which dominate the economy. These chaebols often engage in capital raising activities to fund their expansion plans and maintain their market dominance. This has created a competitive environment for smaller companies seeking to raise capital, as they may struggle to attract investors compared to the well-established chaebols. Another local special circumstance is the regulatory environment in South Korea. The government has implemented measures to encourage capital raising activities, such as easing listing requirements for IPOs and providing tax incentives for bond issuances. These policies have helped to stimulate the capital raising market and attract both domestic and international investors.

Underlying macroeconomic factors: The development of the capital raising market in South Korea is also influenced by underlying macroeconomic factors. The country has a strong and stable economy, with a well-developed financial sector and a large pool of domestic savings. This provides a solid foundation for capital raising activities. Additionally, South Korea has a highly educated workforce and a strong focus on technological innovation. This has led to the emergence of innovative and high-growth companies, which are attractive to investors seeking opportunities in the capital raising market. Furthermore, the South Korean government has been actively promoting the development of the capital raising market as part of its efforts to support economic growth and foster entrepreneurship. This includes initiatives to improve corporate governance, enhance investor protection, and strengthen the regulatory framework. In conclusion, the Capital Raising market in South Korea is developing rapidly due to customer preferences for IPOs and bond issuances, as well as the local special circumstances of the presence of chaebols and supportive government policies. The underlying macroeconomic factors of a strong economy, a focus on technological innovation, and government support further contribute to the growth and development of the market.

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on the amount of capital raised, the average of deal size and the number of deals.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use data from OECD, annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, CPI, number of small and medium-sized enterprises (SME), new businesses registered (number) . This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

Venture capital is the term used to call the financial resources provided by investors to startup firms and small businesses that show potential for long-term growth. It has become a very important source of capital for entrepreneurs, who often have problems with financing their needs through risk-averse banks. Venture capital investments incorporate a high level of risk as only some of the VC-backed companies develop into successful and highly profitable businesses. In 2020, the leading venture capital backed company worldwide was the Manbang Group, which based in Nanjing, China.