The U.S. NASDAQ market is the hub of innovative companies. Launched as an electronic trading market in 1971, NASDAQ has now become the world’s largest technology-focused stock exchange. As of 2024, the NASDAQ Composite Index has surpassed the 16,000 mark, showing an astonishing growth of about 90% compared to 2020. This remarkable surge is attributed to the rapid expansion of innovative companies centered around AI, semiconductors, and cloud technology.
Companies like NVIDIA, Apple, and Tesla have grown through NASDAQ, while industries such as AI, semiconductors, and biotech raise capital here, leading global innovation. The most distinctive feature of NASDAQ is its structure that makes it easier for innovative companies to go public.
Thanks to this flexible listing system, NASDAQ has naturally become a gathering place for startups and tech-centric companies. Through NASDAQ, companies can relatively easily secure capital even in their early stages and gain global investor attention, allowing them to grow rapidly. NASDAQ’s success goes beyond the mere advancement of the stock market—it contributes to the formation of an innovation-driven industrial ecosystem.
A Market Favored by Global Capital—Where Do We Stand?
As technology-based startups worldwide continue to grow through stock markets, countries are striving to make their domestic stock exchanges attractive investment destinations. Japan has implemented corporate governance reforms, leading to an inflow of global capital, and as of February 2024, the Nikkei Index has surpassed 39,000, reaching an all-time high in 30 years. NASDAQ has followed a similar growth trajectory, surpassing 16,000 in February 2024, driven by continued growth in the tech sector post-pandemic. This marks more than a twofold increase compared to the 8,000 level at the beginning of the pandemic in 2020, demonstrating that global investors still trust technology-driven growth. Japan’s reforms in corporate governance restored investor confidence, bringing global capital back to the Japanese stock market.
Where does the Korean stock market stand in this trend? Currently, the KOSPI index is stagnating around the 2,500-point range, and it is not easy for innovative companies to secure funding domestically. Strict listing requirements and rigorous screening criteria serve as significant barriers for companies, leading many domestic firms to look overseas for stock listings. A prime example of this is Coupang.
Instead of listing in Korea, Coupang went public on the New York Stock Exchange (NYSE) in 2021, debuting successfully with a market valuation of approximately 46 trillion KRW. At that time, Korea’s stock market had stringent listing conditions, making it difficult for growth-oriented companies to raise capital. Coupang chose the NYSE because it could secure higher market valuation and faster capital access in the U.S. At the time of its listing, Coupang’s market capitalization reached 46 trillion KRW, positioning itself as a competitor to Amazon. This case highlights the reality that the Korean market does not provide sufficient growth opportunities for innovative companies.
Beyond Coupang, an increasing number of domestic companies are opting for overseas stock markets. Many AI and tech startups are pursuing listings on the Hong Kong Exchange or NASDAQ, indicating that Korea’s stock market structure is not conducive to growth-oriented firms. The primary reasons behind this trend include easier capital access, more flexible regulations, and greater exposure to global investors.
To address these challenges, there is growing demand for the Korean stock market to establish a more flexible and open system that allows new growth companies to secure funding. Rather than simply expanding the existing market, a dedicated market exclusively for innovative companies is needed to ensure stable growth.
A New Market for Emerging Growth Companies
Establishing a Korean version of NASDAQ is not just a regulatory change—it is a crucial strategy to strengthen the domestic innovation ecosystem. For companies in AI, semiconductors, renewable energy, and biotech to grow domestically and attract global capital, a more flexible listing system is essential. Additionally, to prevent promising companies from leaving for foreign stock exchanges, it is crucial to create an environment where they can secure funding efficiently within Korea.
Several key elements are necessary for this new market to succeed. First, the listing requirements must be relaxed, and the screening criteria must be made more flexible so that emerging companies can go public more easily. Even KOSDAQ, which is supposed to accommodate growth companies, currently imposes excessively stringent listing standards, driving businesses overseas.
However, merely lowering the listing threshold is not enough. Investor protection measures must be implemented to maintain market credibility. Strengthening internal audits for a certain period, ensuring management transparency, and enforcing governance standards will enable investors to invest in emerging companies with confidence. Japan, for example, successfully carried out stock market reforms by easing listing requirements while simultaneously strengthening investor protection policies.
Furthermore, for Korea’s version of NASDAQ to thrive, it must be an open market capable of attracting global investors. Policies and regulations that are favorable to foreign investors should be introduced, and the market structure should be designed to allow foreign companies to list as well.
A New Growth Market—Now a Necessity, Not a Choice
The Korean stock market is losing its appeal to global investors. Domestic innovation-driven companies are looking to the U.S. and Hong Kong for stock listings, and investors are shifting their capital toward foreign markets with higher returns. To counter this trend, it is essential to establish a Korean version of NASDAQ and develop it into a globally competitive market.
Failure to adapt will lead to stagnation, while embracing innovation will open new growth opportunities. Could the Korean version of NASDAQ be the solution? Now is the time for action, not just discussion.
