[Press] Cloocus Aims to Cement Position as Leading AI MSP

(Image provided by Steve Hong, CEO of CLOOCUS)

Seoul, July 15, 2024 — Hong Seong-wan, CEO of Cloocus (www.cloocus.com), emphasized the importance of experienced companies in the AI era during a recent interview with Digital Daily at the company’s headquarters in Gangnam, Seoul. Since its establishment in 2019, Cloocus has rapidly grown as a cloud Managed Service Provider (MSP) and is now evolving to become a partner in introducing new technologies like AI.

Hong, a former Samsung SDS developer, identified the potential of the cloud business in Silicon Valley around 2012. He founded Cloocus in Korea in 2019, leveraging his experience running an online gaming company to collaborate with Microsoft, which was expanding its data center and gaming business in Korea, to build expertise as an Azure cloud MSP.

Cloocus, a latecomer in the domestic MSP market, is one of the fastest-growing companies. Starting with sales of $263 million in its first year, the company doubled its revenue to $647 million in 2022 and $1.27 billion in 2023, aiming for $2.32 billion this year.

Despite the rapid growth, Cloocus is still operating at a loss, but Hong expects a turnaround in profitability in the second half of this year. “If MSPs rely solely on reselling CSP (Cloud Service Provider) products and engage in price competition, they will incur losses,” he said. “MSPs must add value through new technologies like AI.”

Cloocus is focusing on AI and data-related projects instead of simple resale businesses. “Initially, MSPs managed IaaS (Infrastructure as a Service), followed by PaaS (Platform as a Service) and SaaS (Software as a Service). Now, businesses related to AI and data analysis are emerging,” said Hong. “Cloocus is concentrating on AI and data projects, and I believe that following these digital trends is what MSPs should do.”

Recently, Cloocus established a separate AI and data technology center, operating specialized teams in each field. The company is building references by conducting technology verification (PoC) with clients from various fields, including Hyundai Motor Company, Kolon Industries, Ecobit, and Dankook University.

Recognized for its potential in AI and data-centric businesses, Cloocus recently secured a $15.5 million Series B investment. Stonebridge, which participated in the Series A investment, and Helios PE, an independent private equity firm, each invested $7.75 million, bringing the total accumulated investment to $33.7 million. Hong added, “Although the amount is not large, we will strive to solidify our position as an AI MSP with this funding.”

Cloocus is aiming for an IPO in 2026. “We plan to select an underwriter in the second half of this year and begin full-scale preparations,” said Hong. “We will work to achieve BEP this year and generate high operating profits by the time of the IPO.”

The company’s global expansion strategy is also gradually taking shape. After establishing subsidiaries in Malaysia and the US in 2021, Cloocus is considering Japan, the Middle East, and Turkey as the next markets. “The Malaysian subsidiary, with about 20 employees, is generating revenue, and with MS and Google recently deciding to invest in AI data centers, the future looks promising,” said Hong. “In the US, we have formed partnerships with about 50 SaaS companies and have already signed MOUs with entities in the Middle East.”

Recently, Cloocus has been planning the launch of an ‘AI Alliance’ as part of its global expansion strategy. “AI requires various technical requirements, and it is challenging for a single company to build a platform that accommodates new technologies and diverse customer demands,” said Hong. “We realized the need to form an AI alliance with specialized companies in each field, preparing a business model where multiple specialized companies collaboratively provide services.”

“Our current endeavors are not only needed in Korea but globally,” emphasized Hong. “If our AI and data technology capabilities are recognized, we could list on Nasdaq or acquire large companies. We are confident that we will become a company that stands out anywhere in the world by continuously enhancing our company value,” he said.

This press release is intended for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities.