7/15/2021 Kim Beom-su, Kakao: Life of Brian | Financial Times

The Monday Interview

Seoul
Kim Beom-su, Kakao: Life of Brian
English nicknames for all — just one way in which the tech billionaire flouts South Korean norms

Kim Beom-su (aka Brian), chairman of Kakao Corp. © FT

Song Jung-a
DECEMBER 27 2015

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Kim Beom-su, South Korea’s most successful internet entrepreneur, jokes that his life might have
gone wrong if there had been computer games to play with when he grew up. The 49-year-old
billionaire is a hardcore gamer who enjoys playing online games, such as Blizzard Entertainment’s
Diablo, with his wife and two children in his free time.

“You can experience things online that you can never in reality,” he enthuses. “In the process of
fighting with your enemies and protecting your castle, you can learn problem-solving skills by
setting up creative strategies and co-operating with others.”

His love of online games and cyber communication has made him one of South Korea’s few self-
made billionaires — a rare feat in a country where the economy is dominated by a handful of big
family-run conglomerates known as chaebol.

Mr Kim has created two successful ventures from scratch: the country’s first online game portal,
Hangame Communications, followed by the locally ubiquitous mobile messenger app KakaoTalk.

He chairs Kakao, the operator of KakaoTalk, and has become one of the country’s most popular
super-rich businessmen — with a fortune estimated at more than $2bn — thanks to his rags to
riches tale, which contrasts sharply with the easier rise of most chaebol tycoons.

Born to parents who did not study beyond elementary school, Mr Kim grew up in poverty. His
family of eight shared one bedroom in a poor neighbourhood of Seoul as his parents moved from
one job to another to make a living. He was the first of his family to go to college and paid his way
through it by offering private tutoring.

“We had to create our own paths because my parents didn’t have time to take care of us,” recalls Mr
Kim, in his modest office in Pangyo, a small city just south of Seoul where many IT companies are
clustered. “A great degree of autonomy was given to us, which also taught me a sense of
responsibility.”

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Hardship made Mr Kim extremely driven. But it is hard to detect any trace of such struggle in him
today. He cuts a relaxed figure with a goatee and in semi-casual attire: white dress shirt, a brown
cardigan and navy jacket.

At Kakao, employees call him by his English nickname, Brian. In return, they are also known by
their English nicknames. This is Mr Kim’s way of dismantling the country’s hierarchical corporate
culture, in which employees are expected to address senior colleagues only by title and never by
name.

His first job was developing an online communication service at Samsung’s IT services unit. But he
left the company five years later to open an internet café and start developing online social casino
games. Hangame has attracted huge traffic and was later merged with search engine Naver to
become the country’s dominant web portal, NHN.

“In the early days, I was working day and night as a businessman and programmer. Then, I went to
a sauna at dawn and burst into tears,” he says. “I was so proud of myself leading my own business
but I was also afraid I might not be able to pay my staff.”

Since then, a long shower — sometimes up to an hour — has become a morning ritual and an
opportunity to think. After heading NHN for five years, Mr Kim moved to Silicon Valley in 2005 to
build the company’s gaming presence in the US. But it turned out to be tougher than expected and
he stepped down in 2007. “A ship is the safest at a harbour but that’s not what it is made for,” he
said in his resignation letter, explaining why he was leaving the security of NHN for another
venture.

While he was racking his brains in California for new ideas there came the iPhone, which
immediately mesmerised him. Mr Kim, with his new team mates, returned to Korea to develop
apps for the iPhone, two years before it was introduced in the country.

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In 2010, they launched KakaoTalk, which is now used by three quarters of South Korea’s 50m
population. Last year, he merged Kakao with Daum Communications, Naver’s competitor,
providing a larger balance sheet with which to move into new business lines such as mobile
banking and taxi hailing.

This year, he surprised the industry by appointing Jimmy Rim, one of the country’s youngest
CEOs, to control Kakao’s daily operations.

Of late, Mr Kim has been devoting more time to his personal ambition of developing 100
technology start-ups. He has already invested in more than 70 start-ups through his two venture
capital firms to cultivate the country’s tech scene.

“In Korea, you should risk your life to start your own business because you are finished once you
fail. You learn many lessons from your failure but there is no chance to use such know-how,” he
says. “But, in Silicon Valley, the venture environment is so systematised that failed experiences
often lead to better ideas. I envied that system and wanted to create such a climate here.”

As the first generation of successful internet entrepreneurs like Mr Kim invest part of their wealth
in start-ups, the funding environment for South Korean start-ups has improved in recent years,
also backed by the government’s drive to foster ventures and ease the country’s economic reliance
on chaebol. But smaller businesses still struggle to grow in the shadow of these sprawling
companies.

Although South Korea can boast global manufacturers with vast international operations,
expansion across the world has been a painful process for its IT service providers. Kakao has
struggled to expand its user base beyond the home market, with limited overseas success. It
acquired this year the shrunken US-based social network Path in an attempt to revive its push into
Southeast Asia.

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7/15/2021 Kim Beom-su, Kakao: Life of Brian | Financial Times

As well as challenges overseas, Kakao also has to cope with regulation at home. Last year, Kakao
came under the spotlight for a public stand-off with the government, whose heightened
surveillance of digital communication has sparked fears for online freedom. The company ended
up bowing to state pressure in October, saying it would comply with prosecutors’ requests to
monitor criminal suspects’ messages.

Some critics say the decision by Kakao to back down was made as a compromise to win
government approval to set up the country’s first internet bank. Asked about any possible link, Mr
Kim first looks perplexed. “Protecting users’ privacy remains our top priority but no company can
ignore the country’s legal requirements,” he says defensively.

Along with government interference, the country’s rigid education system is also widely seen as a
barrier to the development of the so-called creative economy. The country faces growing criticism
that its focus on rote learning bodes ill for the future.

Mr Kim is one of the growing ranks of the South Korean elite that send their children abroad. His
son is study­ing at a US university while his daughter had four years of home schooling.

“The current education is just focused on the university entrance exam, which does not require any
creative thinking,” he mourns. “Many people confine themselves to existing frames. But, for the
next generation . . . you need to think out of the box.”

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