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By Jhoo Dong-chan
An increasing number of venture capitalists are paying attention to the booming popularity of craft beer.
According to analysts, popular craft beer maker 7Brau has recently inked an investment deal with Raising to secure 2 billion won. The deal is a follow-up investment after it got a 1 billion won investment in July last year
7Brau said it is building an 11,000 square-meter brewery in Yangpyeong, Gyeonggi Province, scheduled to be completed in the first half of the year.
Famous for its signature Taedonggang Pale Ale, Seoul-based craft beer maker The Booth Brewing had a 8.6 billion won sales in 2016 from its two breweries, one in California and the other in Seongnam, Gyeonggi Province, The Booth Brewing say it aims to see 100 billion won in sales by 2020.
Recognizing its potential, The Booth Brewing has successfully secured 10 billion won in investments from venture capitalists so far.
Another popular craft beer brand Jeju Beer also got 4 billion won in investments last year.
Big players such as UTC Investment, SBI Investment and HBIC participated in the investment in the Jeju-based craft beer maker.
Another Seoul-based brand Amazing Brewing Company also secured investments from Altos Ventures and BonAngels Partners to build a brewery with an annual production capacity of 1.2 million liters in Icheon, Gyeonggi Province. After the completion, the company said it will expand its sales network into local retailers and convenience stores.
According to sources, the nation's craft beer market is worth about 20 billion won ($18.68 million). It occupies a relatively small portion of the nation's entire beer market worth more than 4.6 trillion won, but has enjoyed 100 percent growth in sales every year.
Compared to the U.S. beer market where craft beer accounts for about 20 percent, analysts say the nation's craft beer market is likely to continue its growth streak for years.
"Craft beer has enjoyed an explosive popularity especially among the young generation, but the market accounts for 0.5 percent of the total," said a Nomura Securities analyst.
"It will continue to grow at least for a couple of years. It is a very promising investment market."
According to the Korea Craft Beer Association, the number of licenses for craft beer issued by Ministry of Food and Drug Safety was only 54 in 2014, but reached 95 last year.
