[VC Now] "AI Alone Can't Differentiate"... Why D.CAMP Is Focusing on Aerospace

Interview with Kim Hyohyun, Head of Investments at D.CAMP
"Startup Growth Support Platform... Managing Over 1 Trillion Won"
"We Will Advance Stage-Specific Support Systems"

"If a company says it does only 'AI (artificial intelligence),' I actually hesitate to invest. Ultimately, the key is whether a team can truly solve a specific industry problem."

Kim Hyohyun, Head of Investment at D.CAMP, recently told The Asia Business Daily in an interview at Front 1 in Mapo-gu, Seoul, "These days, almost no team is doing business without AI, but simply using AI is no longer a differentiator." As the venture investment market rapidly shifts its focus to AI, D.CAMP is instead seeking new opportunities in sectors with high barriers to entry and strong industry application, such as aerospace, semiconductors, and materials, components, and equipment (MCE).

Kim Hyohyun, Head of Investment at D.CAMP, is interviewed by The Asia Business Daily on the 18th at the D.CAMP office in Mapo-gu, Seoul. 2026.5.18 Photo by Kim Hyunmin

D.CAMP is a startup growth support platform operated by the Banks Foundation for Young Entrepreneurs, a non-profit foundation established with donations from 19 financial institutions. The organization runs a quarterly "Batch" scale-up program that selects promising startups and provides intensive support over one year. The total assets under management, including direct investment, funds, and fund-of-funds, exceed 1 trillion won. Despite a strong focus on early-stage companies, D.CAMP's direct investments have generated an internal rate of return (IRR) of over 10 percent, with a multiple on invested capital exceeding 2 times. Fund investment performance is also around a 10 percent IRR.

Kim began his career in the industry as an intern at Korea Venture Investment Corp. in 2009 and later gained experience in risk management and fund management at two private venture capital firms. He recalled, "At the time, the startup ecosystem was not as well known as it is today," and added, "I entered the industry because I saw it as a field that plays a new and important role in corporate growth." Kim joined D.CAMP in 2019, focusing on fund investments, and has served as Head of Investment since 2023.

Focused Support for Challenging Pre-A Stage Fundraising

D.CAMP is expanding its investment focus beyond the initial seed stage to include the pre-A stage. The strategy is to concentrate on the phase where product and customer validation (PMF) and business-to-business proof of concept (PoC) are needed, rather than just the idea stage.

Kim explained, "Accelerators and VCs are actively investing in the seed stage, and companies that survive to Series A and beyond generally have easier access to funding. However, the pre-A stage—where a product exists but PMF validation is not yet complete—is the most challenging segment." He added, "The D.CAMP Batch Program is also focused on milestone validation and PoC support at this stage."

According to Kim, D.CAMP's distinctiveness lies in its growth support system, which goes beyond simple investment. In addition to direct investments, D.CAMP leverages its fund network to facilitate follow-on funding and global expansion for startups.

He said, "Rather than acting as a financial investor (FI) with a short-term exit focus, we see ourselves as a partner who supports startups throughout their entire growth journey. What sets us apart from typical VCs is that we also provide non-financial resources such as support for overseas expansion, workspace, and mentoring."

In practice, D.CAMP has invested in batch program operators in the United States to secure spaces for Korean startups. In Japan, it utilizes its network of general partners (GPs) to help local startups connect with large corporations for PoC opportunities. Kim explained, "By investing in fund managers, we gain access to global networks, which in turn enables us to support startups as they expand overseas."

"Proactively Discovering Aerospace Startups in Collaboration with VCs"

Currently, the sector of greatest interest to D.CAMP is aerospace. D.CAMP is actively expanding its discovery of relevant startups by partnering with specialized management firms in the field. Notable examples include Space Linetech and CosmoBee.

Space Linetech is a company that uses the microgravity environment of space to create protein crystals. In space, where gravity is nearly absent, it is possible to produce more uniform protein structures, which can then be used to enhance drug efficacy. Kim said, "Depending on how you look at it, it's a pharmaceutical company, but it's also an aerospace company. It's one of the most interesting teams we're watching."

Kim Hyohyun, Head of Investment at D.CAMP, is interviewed by The Asia Business Daily on the 18th at the D.CAMP office in Mapo-gu, Seoul. May 18, 2026. Photo by Hyunmin Kim

CosmoBee, a university research lab-based startup, is developing micro-thrusters necessary for the formation flying of small satellites. This technology enables precise adjustment of the distance between satellites. Kim said, "With the growing number of small satellites being launched, the demand for formation flying technology is also increasing. We're seeing more and more interesting teams emerging in the aerospace field."

Kim cited Innospace, a space launch vehicle company, and FiscalNote, an AI-based legislative analysis firm, as representative exit cases. Innospace was sold after its listing, while FiscalNote was exited through a merger with a listed company on the New York Stock Exchange. D.CAMP invested in both companies when their valuations were around 10 billion won.

"Liquidity Is Increasing... But Overheated Valuations Are a Concern"

On the current atmosphere in the venture investment market, Kim expressed both optimism and caution. "Funds such as the National Growth Fund are injecting capital into the startup ecosystem," he noted, "but as investors, we must be wary of excessively high startup valuations."

He raised particular concerns that the rising valuations of domestic startups could become a barrier to overseas expansion. Kim said, "U.S. batch programs have their own target valuation ranges, and it is often difficult for Korean startups to meet those expectations. Sometimes, it even feels like valuations in the Korean market are higher." This means that startups recognized for their high valuations domestically may struggle to attract follow-on investments in overseas markets due to pricing pressures.

He went on to say, "There is a risk that government funds could flow excessively into specific fields such as AI, semiconductors, and deep tech. The more capital there is, the more discerning we must be in selecting companies that have the resilience to survive the next downturn."

He added, "Until now, D.CAMP has focused on expanding the size of its funds and the number of investments, but going forward, we plan to further enhance our post-investment management systems to match the growth stages of startups. As our investment scope expands to the pre-A stage, we will strengthen our ability to support growth at each stage."

This content was produced with the assistance of AI translation services.