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Kindred Media

 

Kindred Media Interview Transcript

2023.05.01

 

Welcome to KindredCast, where we shine a light on the people and ideas shaping our future. KindredCast is a production of Kindred Media powered by LionTree, the independent investment and merchant bank for creativity, community and capital. Today LionTree managing director Antal Runneboom is joined by Naver CFO Namsun Kim often referred to as the Google of South Korea. Naver is Korea's largest startup and also its largest internet platform. The company recently completed its $1.2 billion acquisition of secondhand fashion marketplace, Poshmark - its largest acquisition ever and a transaction on which LionTree was honored to act as exclusive financial advisor to Naver. Join us as Antal and Namsun discuss everything from M&A to AI, the creator economy and more.

Antal: Hi, I'm Antal Runneboom, a managing director at LionTree in San Francisco, focused on technology M&A. Today we are joined by Namsun Kim, Chief Financial Officer of Naver Corporation, one of Korea's largest publicly listed technology companies. Namsun joins us from Seoul, Korea. Namsun, thank you for joining us today.

Namsun: Hi Antal, thank you so much for inviting me.

Antal: So let's start by learning a bit more about your background. You grew up in the U.S. and Korea, studied at Seoul University and then came stateside again to study law at Harvard University. You started your legal career at Cravath and then moved into investment banking at Lazard, New York and continued your career at Morgan Stanley in Seoul, in Hong Kong before working in private equity at Macquarie in Korea. Your move into corporate happened only recently in the summer of 2020, when you joined Naver as SVP corporate development, then being appointed chief financial officer about one year ago in the spring of 2022. How did this prepare you for your current role at Naver and what stood out about Naver and what made you make the jump to the company side?

Namsun: I was fortunate enough to have spent time both in the U.S. and in Korea when I was relatively young. Somehow, I made my way back stateside for law school, thinking that it would be a relatively versatile degree to prepare me for whatever I wanted to do and begun my career in corporate law, found my way naturally towards investment banking and always wanted to be on the buy side, especially within private equity. It was interesting, I never had planned on taking on an in-house corporate role, but I think at the time, it was 2020, it was right at the height of the pandemic, global internet companies were just taking off in terms of valuation, in terms of accelerated growth. Naver at the time, which was 20 years ago, a startup, had emerged as the top five Korean company in size by market cap. So when the opportunity somehow came, it was almost a no-brainer in terms of the chance to experience a very fast-paced, quickly evolving business model of a platform and company that prides itself in being the most innovative and also have successfully made the transition from a startup to one of the largest market cap companies in Korea.

Antal: Since becoming CFO, you also completed your largest ever acquisition with Poshmark. What's next for Naver, and what are some of your key priorities in your role as CFO and how do you think about transforming the role versus your predecessor?

Namsun: I think Naver previously had been a little bit more reserved in terms of doing M&A, especially in terms of cross border M&A and investing outside of Naver's home markets. Now, when I say Naver's home markets, I really mean Korea and Japan. And with the change in management, a younger generation, just a little bit more outwards looking, I think we were able to get the board comfortable and the organization more comfortable with expansion into the western markets. When it comes to the consumer internet experience, the U.S. and Korea, we noticed a lot of similarities and a lot of things that we thought could translate well and so that's when we started to think about M&A. And naturally it was content and commerce where we began to make investments and acquisitions. Now over the next several years, really, we'll be focusing on integrating the assets and really strengthening our organic business.

Antal: I also wanted to briefly touch upon your CEO, Choi Soo-yeon, who was appointed around the time you were announced as CFO. Interestingly, you both also graduated from the College of Engineering at Seoul University and obtained degrees from Harvard. You've had such similar paths, tell us a little bit about your working relationship and your shared vision for the company.

Namsun: It was a nice surprise to meet someone who was similar in age with a similar background and shared experiences. We never really knew each other before I joined Naver in 2020. But Soo-yeon, I must say, is really unique and a special leader in that she is the second woman to be the CEO of this company, second woman in a row, as a very young leader and a very energetic leader. She is probably the strongest supporter and partner to myself when we think about global initiatives, when we think about changing the corporate culture, bringing younger ideas, newer ideas into our business practices.

Antal: We’re wishing you both a lot of success in your roles over the coming years. Naver was founded in 1999 by Lee Hae-jin, who started the company as a web portal with an embedded search engine. Naver rapidly emerged as the leading search engine in Korea, where today it still accounts for about 65% of the search traffic according to Statista. Because of this Naver is often being referred to as the Google of Korea. The company went public on the KOSDAQ in 2002. In the 2000s, Naver expanded its offering on multiple fronts, but most notably launched the popular messaging app, Line, in Japan. And you also launched Webtoon in 2004, which we’ll come on to talk about. Over time, Naver’s expanded its presence in display advertising, eCommerce platforms and stores and related advertising. You've launched payments and Fintech businesses in Korea, and you're also building your own cloud offering in the Korean market, and launched your own AI platform, HyperCLOVA, with a unique Korean language model. Notably in 2013, you split from HANGAME and later in 2021, you actually announced the ambitious demerger of Line and the combination with SoftBank's Yahoo, Japan, to create a diversified internet company in Japan, known now as Z Holdings, in which you still retain a 32% minority stake. In both cases, refocusing the company on your core business in search and commerce. In 2021, you acquired Wattpad for $600 million, and then you announced the acquisition of Poshmark. As of 2022, you're generating about $6.4 billion of revenue across all of these businesses, and about 45% of that's coming from search and display, 22% from commerce and about 15% in fintech and another 15% in content. And you're actually very widely profitable in your core business. And just for the audience's benefit, today you're listed in Seoul still with about a $23 billion market cap and also with a uniquely institutional, broadly held shareholder base for a Korean company.

Namsun: It may look like a collage of different business lines, when actually it's one single continuum organic extension. Now, when we go back to the late 90s when the search market was just evolving, there was really not much written in the Korean language on the web. And so our founder at the time wanted to create a search engine for the Korean internet consumer. But he quickly realized that there really was not enough content in the Korean language for a Korean speaker to go out and find. Language is what enabled search, and we quickly realized that we had to create content that was searchable using our engine. And so whether it was Webtoon at the time or whether it was news services, and even later on when we got into commerce, whether it be fashion or other acquisitive needs, we view it as a form of expression. And information regarding commercial products also is a type of content. And that also went into other forms of entertainment, such as digital comics, et cetera. Our payments business was naturally an addition to our commerce business, which really wasn't conceived with the intent of growing that as an independent business line, but really something that we believe would help strengthen the shopping experience, which would in turn strengthen the quality of engagement on the Naver platform.

Antal: Many folks have heard of names like Coupang and Kakao and Nexon, and Krafton, and then obviously you've also got the sort of larger consumer electronics companies like Samsung and LG. It'd be interesting just to hear a little bit about how you fit into this world of the elite Korean internet and digital entertainment companies and how you're different as well.

Namsun: I think the Samsungs of the world really were our predecessors, in that they were primarily manufacturers who grew through exporting high quality product, hardware into new markets. Now, Korea has always been an export driven economy with more than 50% of the GDP coming from exports. Whereas today, that contribution has dropped to less than 40%. And that's where I really think Naver comes in, Naver was one of the first, domestic corporates relying on domestic consumption to grow, whereas previously, most of the large cap companies were all export driven business models. In the late 90s and early 2000s, we prided ourselves in being an innovator, disrupting the traditional forms of, whether it's commerce, whether it's any other form of economic activity. Now, I think that was important in providing the background for the Coupangs of the world who were able to emerge about a decade after that. We think that we've provided kind of the digital infrastructure and the digital framework for all the successful companies that were able to follow us and who were able to specialize on a certain vertical, whether it be gaming, whether it be commerce. Whereas Naver was really just all things internet and all things digital.

Antal: Search and advertising is the largest pillar of your business today, and that includes things like display advertising and commerce driven advertising as well. You've been at the top of this category for a very long time facing many big international companies. And it's true that if you look globally, players like Google and Microsoft with Bing have penetrated a lot of geographies and countries where you've got native languages, yet in Korea you've managed to hold them off. So it's really interesting, I think, for folks to understand why that is.

Namsun: Yeah, we think it's two things that actually helped us secure our position in Korea. One is obviously language, but we do think with the development of AI and the speed at which it's evolving, the gap that arises from difference in language will narrow very, very quickly over time. But the second thing that we think really was the larger contributor and continues to be is the fact that we were the largest platform for engagement where most of the traffic first originated on Naver and we were actually able to build a corpus of proprietary data dedicated to our platform. We created blogging, we were the first platform to create blogging in Korea. That was the first form of user-generated content more than 20 years ago. We were the first platform to provide communities, message boards, things like Craigslist. And naturally, when we got into commerce, we did not want to make the mistake that Google made in losing the top of funnel product queries to Amazon. You probably know this better than I do, but I'm pretty sure that Amazon would not have allowed themselves to be searchable to the extent that they are on their own domain through Google. Whereas Coupang initially and still to a certain extent today rely on traffic that originates on Naver to get to a specific product listing on Coupang. And so we were careful and tried very hard to protect the initial engagement that originated on our platform and the massive vertical proprietary data that we had, whether it was user generated blogging, reviews, any other form of communication, and subsequently product listings through our commerce channel.

Antal: Obviously there's been a lot of excitement over the last few months around ChatGPT here in the U.S. with OpenAI, through Microsoft's partnership with OpenAI. And they are going to integrate it into Bing for search, it's also become clear that generative AI is going to become a big part of the search experience going forward. In your view, how does AI powered chat ultimately change this search landscape for you in the years ahead?

Namsun: I think that's still up for debate. The need to search and the need to comb through a list of potential findings is not completely interchangeable with a more targeted chat format driven response. There will continue to be demand for search and specific targeted responses, and that's where obviously generative AI is completely changing the landscape. And so the evolution of AI and the rapid pace at which it continues to evolve is fascinating, it's unnerving. But we also feel that it provides many different opportunities. And for a company like Naver, language was so important to us and we were one of the first companies to put out one of the largest models, I think this was a couple years ago. We had provided a model that exceeded a billion parameters and that was like maybe one of the top three companies, the first three companies, to come out with that.

Antal: In commerce the best way to think about Naver is probably as a platform that connects consumers to a wide range of vendors through your Naver Shopping, Naver Store, and also Naver Cafe. For the audience, is this more of an Amazon, eBay, or Shopify type approach? And how is the business positioned? How is it positioned versus Coupang and Gmarket, also well known in commerce in Korea?

Namsun: Our model is not an Amazon or a Coupang model in that we are not selling first party inventory, we are not taking inventory, we are not providing the logistics infrastructure internally to complete that purchasing experience. We're more like a cross between eBay and Shopify in that we provide the tools to the individual sellers to come set up shop on our platform and sell their products. And so that's kind of like Shopify, but all on one domain. And our strategy is that we will continue to pursue that model, we'll continue to be an asset light driven model where we're in the business really of enabling commerce rather than trying to be a retailer ourselves, which essentially is what we think Amazon and Coupang are doing.

Antal: How do you view Naver's opportunity in commerce in the years ahead? And how do you see it potentially becoming a more global business in its own, right in the years ahead? And that's putting Poshmark to the side for a moment.

Namsun: We think Korea has always been a leader when it comes to internet innovation. And another piece of evidence regarding that is live shopping, for example. Live shopping is something that you see have already become mainstream in Korea and China, and we think it's because a Korean consumer is much more willing to go mobile, much more willing to appreciate and view influencers and content that's maybe user generated, but takes on more versatile formats. And so we believe that the commerce experience will continue to involve and we'll see newer dimensions, whether it's live shopping, whether it's live broadcasting, or whether it's secondhand commerce. And Naver will endeavor to continue to keep up with the pace of that evolution, and we'll continue to make selling and buying easier for the seller and for the buyer, whether it's through AI driven recommendation tools. Now we're providing AI created avatars or characters to actually perform as the show host for your live broadcast.

Antal: In your commerce business you also have had a lot of success with KREAM, rapidly building this business to over a billion dollars of GMV in the last couple of years. KREAM, for those of you who don't follow it, is a social shopping platform focused on, amongst others, vintage sneakers and apparel. What's different about this business is that you've driven it predominantly through advertising revenue. Can you give us maybe just some learnings around your experience with KREAM?

Namsun: We think it's apparent that the demand for secondhand product, even more so for unique inventory or higher price point luxury items is very, very high. And you probably see more of that in Korea for a number of reasons. First of all, Korea is a market leader, a test market when it comes to most things retail, especially for luxury apparel brands or cosmetics brands. They look at where the Korean consumption is trending and they use that to project where other markets might follow. And so when we see this increasing demand for secondhand product for reCommerce, whether it's just reselling without consumption or whether it's purchasing secondhand items for actual consumption, there's very high demand for that. And there's very high demand for unique inventory, which the brands aren't going to be able to continue to provide unique inventory year over year. And a lot of the uniqueness really is tied to history. It's tied to trends of the past which tend to repeat themselves. And so we saw the Korean market, we also saw the Japanese consumer and their desire for unique inventory and the wealth of inventory that you see offline in Japan that hasn't yet made its way online. And we'd like to think that if Korea has been a trendsetter for most consumer internet and most retail and today fashion entertainment products, that the likelihood of this really catching on in the U.S. and perhaps even in Europe we believe to be very, very high. So we think there's high potential for reCommerce to become a much more important part of the retail puzzle for the typical consumer.

Antal: Specifically, you approached this with an advertising centric model. How did that unlock demand and growth versus a more traditional marketplace model with take rates.

Namsun: Well, I think it comes back to Naver always having stuck to an asset light business model in that it's easier for us to enable commerce than actually to try to own the pieces of commerce. And one thing that we actually learned was that search is an extremely important part of discovery. Search becomes so much more efficient and accurate when you actually allow the sellers to promote themselves through advertising. And so that advertising, when it enters into that ranking formula, the matching efficiency just increases by several fold. And so rather than extracting value from the seller or the buyer through a take rate, if that seller or buyer is willing to pay for advertising and the advertising leads to a much more accurate or precise matching results, this is a more efficient way to go about it.

Antal: Let's discuss content and Webtoon. So at the core, Webtoon is a creator economy platform where artists can create and publish their own comics, and the most successful make a good living on the platform in the process. You're about two decades old in this business, and it's the leading platform globally for Manga comics, amongst others. Last year you had over 85 million monthly active users, of which about 20 million were in the US. Tell us a bit about how this business works and why it's been such a successful platform in the broader creator economy.

Namsun: At its inception, it was just another form of engagement of content we wanted to provide the Naver visitor and to increase engagement time on our platform. But several years later, we realized that this could actually become a business model and allow creators to monetize. So what we actually believe is that we have democratized publishing and democratized artistic creation by providing a forum and an audience through a widely distributed platform to hundreds and thousands of amateur creators. We have amateur creators who regularly publish on the Webtoon platform. Several thousands of those we select and allow them to actually start monetizing. And we don't meddle in the content creation, we don't dictate or get involved in any of the content itself. All we do is provide the tools, we'll help them polish their production, but really it's a pure user generated format in that we've realized that, again, it comes back to language and content, but it's the same approach that we take to commerce. We don't want to have to own the product. We don't want to have to own the content because we think the amateur user out there is just so much more qualified, is so much more creative than what professionals sitting with the Naver can do themselves.

Antal: And so, in 2021, you went out and bought a company called WattPad in Canada. And as you look at that business more closely, it's really a very similar business, but for published written content. Can you talk a little bit about why you've made that acquisition and how it fits into the broader content vision alongside Webtoon?

Namsun: Yeah. So in Korea, we have a long history of also monetizing web novels, serialized web novels, and they do very well in Japan and China as well. And so the web novel versus web comic really are very close adjacencies where there's a lot of synergies. But when you look at a market like the U.S., it's mind-boggling in that probably the English speaker reads more in terms of number of volumes of books per year, but they don't consume that in a serialized format. They did in the past. There was a time years ago when novels were published serially in the daily newspaper, but for one reason or another, today most of the written content is consumed in the form of full volumes, whether it's through Kindle or eBooks. And so the bet really was we believe that this consumption of offline literature will inevitably come online one day, and online and mobile lends itself much better to serialize content than full volumes which take hours to consume.

Antal: I'm going to just read a quote from the CEO of Webtoon corporation, Junkoo Kim, from earlier this year. He said that Webtoon aspires to be the Asian version of Disney. Can you explain to our audience how the content model works on Webtoon and how the IP created in this environment could ultimately extend into other formats like film and television content, gaming, and merchandising amongst others?

Namsun: We have the largest library of modern form literature, not only in novel format, but also in the graphic novel format. And that's because we've actually democratized publishing. And so we have 600,000 creators on our platform who continue to produce content every week. We actually control the translation, whether it's taking a web comic and turning it into a full feature film or a Netflix drama series. We've done several of those and we've had a number of successes. For example, I think we've had about 10 Netflix titles that were original Webtoon stories that we flipped into Netflix dramas that were at one point in time, top 10 global Netflix title. The translation from a comic book into whether it's animation or full feature film, we believe is very compelling. When we have this kind of insatiable appetite for new and original content, where better can you find, a wider library of that than a library that 600,000 creators continue to contribute into.

Antal: Let’s turn to cloud and AI for a moment. Naver has obviously entered the cloud market. This is effectively akin to what AWS, Google and Microsoft Azure are pursuing in the US market. But there's two elements I wanted to briefly touch on here. One is, what is your cloud strategy and what's your differentiation, particularly in the market in Korea? And secondly, your cloud strategy, more broadly in AI, you've announced the HyperCLOVA large language model which is really focused on the Korean language model. Would be interesting just to get your eye level summary of what you're doing in cloud and then also how this extends into AI in the Korean market.

Namsun: Our cloud strategy is and will be much more selective than the global giants. We'll focus on Korea and select markets such as Japan, markets that we know very well and markets that we believe are very underserved from the enterprise consumer's perspective. If you have AWS or Google Cloud, a large provider sitting thousands of miles away, a lot is left for the client to have to resolve on their own. Whereas Naver being much more localized, understanding the corporate client and their needs much better here, especially in markets like Korea and Japan, we believe that we can actually provide a more customized, high-touch service that relies less on volume of infrastructure, relies less on CapEx, but really more a customized and localized experience. For example, the emergence of the sovereign cloud, you have sovereigns that are very wary of having their data cross borders, and you have corporate culture and processes that are very specific to certain jurisdictions and to certain cultures. And so just like what we had provided in terms of the search or the commerce experience for the Korean or the Japanese user, we believe that our cloud service can fill a gap that these global giants are not filling today. And it's a similar story when it comes to AI in that we believe that our large language models, being trained more in the local language and having the benefit of that corpus of proprietary data that I was talking about before, having data regarding the full shopping experience, having product reviews, user generated content blogs, and whatnot, that actually adds a new dimension that Google or Microsoft probably will not be investing into because they're more interested in providing a more commoditized and broader based offering to a much larger world.

Antal: We've seen news earlier this year around the Korean government’s support of homegrown AI chip makers, and then obviously you've launched your own Korean language model. How big of a role does government play in terms of accelerating this homegrown initiative?

Namsun: I think you can always debate whether government should or play a larger or a smaller role in industry. But one thing that we do see in Korea is the government has played a vital role in a few select instances. For example, in the late 90s, the government actually laid the ground for accelerating the investment into communications infrastructure. And that was what had actually accelerated Korea's internet penetration, which we got to the highest levels in the developed world faster than any other developed country. If that case study is able to replicate itself this time around, we actually think that it can be very advantageous to us, especially for an indigenous tech and AI provider here in Korea. But I guess we'll still have to see how it plays out.

Antal: So you merged Line with Yahoo Japan forming Z holdings. It's about 30% of your market cap, 6.8 billion dollars of value today. How do you think about this business as a minority investment, and how does it fit into your strategy going forward?

Namsun: I mean, it's a minority investment from an accounting consolidation perspective, but we actually have joint control over that with our partner, SoftBank. We continue to believe that Japan is one of the most attractive markets when it comes to eCommerce potential. Internet penetration and eCommerce penetration in Japan is lower than other developed economies, which means that there's much more room for growth. And if you think about just the volume of inventory that's available in Japan, and if you just think about the sheer size of the economy and the way that they’ve actually been a little bit slower to adopt mobile messaging, e-payments, et cetera. But eventually when it comes around, we believe that that's potentially a much stickier market and a much more lucrative market where consumers, whether it's the retail consumer or the enterprise consumer, their willingness to pay for services is much higher than most other developed economies. We continue to work with our partner SoftBank there to help digitize the economy and to help provide compelling services, whether it's eCommerce or whether it's payments or digital content that very few other competitors today, very few other Indigenous competitors are providing.

Antal: In the latter half of last year, Naver faced some of its own headwinds in its business that also extended to other players around the world in the internet sector, and put a lot more focus on profitability, cost-cutting, et cetera. As you think about 2023 and the environment ahead of us, what should we expect from Naver in terms of its outlook and goals.

Namsun: I think profitability has become a focus for everyone again. The accelerated growth during the COVID years, I think, allowed us to forget about that for a brief period of time. But it's less about cost-cutting the way we think about it, but really more about realignment and choosing where to focus our resources and choosing where to place our bets. I think we'll have to be more selective than what we have been doing in the recent few years, but really this year and next year, we will undergo a period of rethinking our portfolio and prioritizing where we want to place our bets.

Antal: Now let's move on briefly to your acquisition of Poshmark. To many players in the category, your acquisition of Poshmark came as a bit of a surprise. What is it that compelled you to make such a substantial inorganic move into secondhand fashion online marketplaces and reCommerce, and why does Naver view this as an attractive market to play in globally?

Namsun: This is really our selected approach to how we thought about our commerce offering. We've made the conscious decision not to take on the Coupang business model or the Amazons of the world. We also have seen the eBays of the past and how they had struggled to expand their offering. I think second hand, especially apparel dedicated secondhand, is something that an industry where we believe and where a lot of commentators and analysts actually project in the medium to longer term to outgrow firsthand online and offline consumption. If you look at the longer secular trends that favor eCommerce, we think that it's hard to get to scale because secondhand commerce is about a broader range of inventory at much thinner volumes. We believe that to make the unit economics for that work, you need to have a very strong foundation in search and search-driven advertising is something that we think can augment that nicely. So it was a selective bet that we made, not necessarily with a point of trying to get into the U.S. market, but really to expand the Naver offering to our core markets being Korea and Japan, and where we saw a lot of affinity between the U.S. consumer and the Korean consumer, where the U.S. market really didn't feel foreign to us.

Antal: People who follow this sector closely, they know names like Depop, Vintage, thredUP and TheRealReal, but what was it about the Poshmark platform specifically that attracted Naver in the context of these other models that you see in secondhand fashion apparel?

Namsun: We thought they had the best social engagement. We thought the community aspects of that platform were much stronger than most of the other competitors. We liked the asset light model, and we liked the price point that they were, and it wasn't too low. There continues to be potential to get into the higher value luxury categories, and the quality of engagement was far stronger than most of the other platforms. Poshmark was able to withstand some of the macro headwinds even during 2022. So looking forward, we thought that that was probably the strongest platform upon which we would be able to build our secondhand product offering.

Antal: What is it that attracted Naver to doing this in 2022, during a down cycle in the industry, and in particular, what is it that's going to get the business growing again?

Namsun: It was an opportunistic acquisition in terms of timing, not in terms of longer term strategy, but in terms of timing, where the markets had corrected and the valuations had come off. So we thought it was the best time to actually enter from a valuation perspective. Now, yes, we did enter at a time facing macro headwinds, but I think that's true about every industry and every company in most sectors across the world. Going forward, we expect to infuse Poshmark with some of the technology and the features that Naver already relies on in terms of providing our own eCommerce solutions, whether it's providing our own live shopping solution or whether it's providing AI-driven search, image-driven search, enhancing the organic search capabilities of the Poshmark platform. So we think there's a lot in terms of product enhancement that we can help drive and R&D that we can help support and finance during a period where most other competitors probably are less capitalized and less equipped to invest into product during these challenging times.

Antal: As you think about Poshmark going forward, you announced when you bought the company, that the management team led by Manish (Chandra) as well as the platform brand of Poshmark would remain independent. It's an interesting approach in the context of the broader Naver. Why is this important to the long-term success of this acquisition to keep it in the state that you acquired it in?

Namsun: I think you see a lot of cross-border M&A where a lot of the synergies failed to realize because a lot of acquiring companies may attempt to integrate the target too much or try to over-integrate. So we want to continue to foster the innovative spirit that Poshmark possesses and we continue to respect the vision that Manish has. So our approach really was we'd like to be a supporter and a partner rather than try to dictate the fate of that team.

Antal: What does success look like in five years with this acquisition?

Namsun: We think there are a number of promising markets outside of the U.S., and Korea and Japan are two of them. There are a few markets in Europe where secondhand commerce we believe has high potential to grow sustainably. So five years later, it's probably Poshmark as you see it today with a few additional features that we're able to infuse into them, plus having entered into a few new markets.

Antal: As you pan out to the broader landscape of Korean technology companies, do you think that your acquisition sets the stage for more Korea (cross-border) M&A into the US technology sector in the years ahead?

Namsun: I think it does provide confidence for a lot of other companies to attempt to take a majority stake in a U.S.-based company. But I really think it's a case-by-case analysis and each institution really needs to find a conviction to be able to expand into a Western market, which historically, I don't think has been easy for Asian companies, especially when it comes to Chinese, Korean, or Japanese companies. A lot of them have successfully organically entered Western markets, but in terms of acquiring into and integrating, I think the success stories there are relatively fewer.

Antal: We live in an interesting geopolitical world, both in Europe as well as in Asia at the moment with China. I'd like to get your perspectives on Korea's role in the global geopolitical economy and in the region in the years ahead, given some of the dynamics that going on at the moment.

Namsun: I really think it's hard to tell right now. The world is evolving in directions that I think five years ago were unpredictable, and this part of the world has always been a very sensitive part of the world with a lot of tension, with a lot of geopolitical tension and we're being pulled in all directions. China is Korea's largest export partner, and the U.S. is Korea's strongest political ally. So I think it'll be a challenge for the people who run the government and also the large portions of the economy going forward in terms of balancing and navigating that.

Antal: Namsun, thank you so much for joining us today. It's been wonderful to spend some time together and I really appreciate all your thoughts. Thank you for coming on KindredCast.

Namsun: Thank you for having me.