The Latest Chaebol Game Plan: Stalking Cyber Startups

Late to join Korea's New Economy, the conglomerates are quickly buying in

These days, Hyundai Corp. general manager Kim Jong Won is busy studying business plans--but not ones for his own company. Instead, he's poring over those of fledgling Internet startups. Hyundai, you see, may dominate Korean industry, but it's a laggard in the online world. As a result, the share prices of most of its old-line manufacturing companies have fallen 30% this year. Incredibly, this has left the founder of South Korea's largest conglomerate and its best-known business tycoon, Chung Ju Yung, poorer--in tradeable share terms--than several young entrepreneurs whose Internet and technology companies have recently gone public. So Hyundai is quickly scrambling to find ways to get in on the action. Says Kim: "We've decided to invest in startups."

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