LG Electronics Inc. Investments early-stage U.S. tech startups are likely to earn decent profits because they raised additional funding at higher valuations than the South Korean company had estimated.
Their growth potential will also provide LG with opportunities to enter high-tech industries through partnerships with them as LG aims to transform into a platform-based technology giant.
The North American Innovation Center (LG NOVA) of LG Electronics, established at the end of 2020, conducts startup investments in the region. It is a VC and startup incubator based in Silicon Valley, California.
Sokwoo Rhee, senior vice president of LG Electronics, heads LG NOVA.
Before joining LG Electronics, he served as deputy director for innovation in cyber-physical systems at the United States Department of Commerce.
LG NOVA is responsible for identifying, evaluating and developing Internet of Things (IoT) and Cyber Physical Systems (CPS) technologies, as well as smart city applications, while establishing partnerships with industry, government and academia stakeholders.
Rhee also worked for the White House Presidential Innovation Fellows program, which supported and managed cross-sector IoT and CPS technology projects.
Since becoming CEO of LG Electronics, Cho Joo-wan has been accelerating investments in startups operating in the areas of connected health, which delivers connected health care anytime, anywhere: e-mobility infrastructure related to electric vehicles and electric boards; and the metaverse, an online marketplace enabling social and economic activities.
NeuroTrainer is one of his successful investments. In 2022, NeuroTrainer won the LG NOVA Mission for the Future Challenge and was among the top 10 finalists in the startup pitch competition, securing a $100,000 investment from LG NOVA.
NeuroTrainer, developer of a virtual reality (VR)-based brain training platform, is working to commercialize cognitive training systems for athletes in collaboration with LG.
It is the official training partner of LA Galaxy, an American men’s professional soccer club.
Last month, US venture capital firm 9.58 Ventures selected NeuroTrainer as one of the first four companies in which it invested and contributed $1.5 million to the startup.
The venture capitalist bets that the NeroTrainers VR brain training platform will be used in various areas such as exercise, education and national defense.
The XRHealth virtual clinic is another American startup that received LG NOVA investment.
Earlier this year, the Boston-based developer and operator of virtual treatment rooms announced a merger with Spain’s Amelia Virtual Care, a VR platform for mental health professionals, to create the world’s largest XR therapy platform.
SparkCharge, a provider of electric vehicle charging services, has secured a $7 million Series A investment from Cleveland Avenue following LG NOVA’s investment in it. The investment brings SparkCharge’s total Series A funding to $30 million.
A VC industry official said LG NOVA improves investment efficiency, which refers to the risk, return and cost of the investment management structure.
Influenced by higher valuations of these American start-ups, LG will increase its pool of investments in start-ups from $20 million. In August, it agreed with Clearbrook Capital Partners to raise over $100 million in a new startup fund by the end of 2024.
Clearbrook focuses on growing companies based in Europe, the Middle East, Africa and North America.
We will further increase investment in innovative companies to secure future growth engines, an LG Electronics official said.
We will identify, nurture and nurture more innovative companies.
write to Jeong-Soo Hwang at email@example.com
Yeonhee Kim edited this article
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