The Rise of Palantir in the Korean Market
South Korean investors have shown a strong interest in Palantir Technologies, a U.S. artificial intelligence (AI) data analysis company. During last year’s Chuseok holiday period, the net purchase amount by South Korean investors in Palantir reached 130.6 billion Korean won. Additionally, an exchange-traded fund (ETF) that bets on double the return of Palantir’s stock price increase saw an inflow of 46.4 billion Korean won. These figures place both investments among the top 10 net purchases by domestic investors in the U.S. stock market.
Palantir, co-founded in 2003 by Peter Thiel, co-founder of PayPal, and Alex Karp, current CEO, was established with the goal of preventing a recurrence of the September 11, 2001 terrorist attacks. The company integrates and analyzes vast amounts of data for governments and enterprises using AI, enabling strategic decision-making. Its AI-based software is widely used in security and public safety sectors, including by the U.S. CIA and Department of Defense. Notably, Palantir played a significant role in tracking and killing Osama bin Laden.
Palantir’s Pop-Up Store in Seoul
In a unique move, Palantir opened a pop-up store in Seongsu-dong, Seoul, from the 14th to the 15th, selling T-shirts and caps featuring the company’s logo and symbols for the general public. The event was aimed at domestic investors and fans, and Karp, the CEO, visited Korea for the occasion. Known for his distinctive white curly hair, Karp spoke extensively about Korea, mentioning its industries and culture with ease.
Karp emphasized that Palantir is not comparable to other companies, reflecting confidence in its products. When asked about the high price-to-earnings ratio (PER) of Palantir’s stock, he stated, “We have the best products, and customers seem to like them.” He also highlighted Korea as the most interesting market commercially, excluding the U.S.
Why Korea?
Karp explained that Korea has a unique manufacturing and hardware culture, which, when combined with AI and software, could unlock the potential of Korean companies. He noted that Korea’s long resistance to software application and efficiency has become an advantage in the AI era. Many Korean companies have owners with deep engineering expertise who are keen on applying software to transform industries.
Karp also discussed why a B2B company would open a pop-up store in Korea. He mentioned that Palantir has the second-largest individual investor community globally, right after the U.S. He found it intriguing that young Koreans are enthusiastic about Palantir, attributing it to their recognition of the company’s deep technical capabilities.
Understanding Palantir’s Business Model
While Palantir’s popularity in the stock market is high, few clearly understand its business. Simply put, it is an AI-based data analysis company. What sets it apart is its proprietary technology that breaks traditional data analysis frameworks. The key concept is “ontology,” which relates to how to define and connect numerous data points and the real world.
Karp, known as the “Silicon Valley eccentric philosopher,” majored in philosophy at Harvard College and earned a doctoral degree in post-classical social theory under Jürgen Habermas. He described ontology as a structure that enables the implementation of large language models (LLMs) within a business context.
Partnerships and Future Goals
Palantir has partnerships with HD Hyundai and KT in Korea. With HD Hyundai, it is co-developing the unmanned surface vessel (USV) “Tenebris” and advancing the FOS project to realize a futuristic smart shipyard. With KT, it has formed a partnership to accelerate AI transformation (AX) business, including joint development of a Korean-style AI platform education program targeting the domestic AX market.
Karp believes that Korean companies have vast, specialized data sets that can be made useful through Palantir’s technology. He emphasized the importance of actively utilizing technology by nations, arguing that if AI helps make a country more efficient and stronger, it should be adopted.
Ethical Considerations and Global Collaborations
Palantir faces ethical debates regarding the use of AI in defense or weapon systems. Karp stated that they are already incorporating AI into military applications, emphasizing the need to set rules for such use. He argued that applying AI to the military is essential, as there is no time for human decision-making during attacks.
Palantir has never sold its products to countries like Russia, China, Iran, or other communist or dictatorial countries. Karp clarified that the company does not engage in internal surveillance, despite concerns raised by critics.
Reflections on Criticism and Future Vision
Criticism of Palantir’s stance has led to debates about whether the company is a “villain” or a “hero.” Karp expressed pride in having protesters who hate the company, believing that their opposition indicates they are doing something right. He emphasized the importance of helping others understand their perspective.
Looking ahead, Palantir aims to be the most important and dominant software company in making the U.S. and its allies the undisputed top military powers globally. The company plans to focus on creating products that allow the West to maintain its dominant position.
Personal Connection to Korea
Karp shared personal connections to Korea, mentioning that his mother used to stay in Korea for four months a year. He noted that Korea is the only country that has sold music in a non-English language in the U.S., highlighting the depth of Korean culture.
Karp also mentioned his love for kimchi, stating that he enjoys various forms of kimchi, including kimchi-jjigae and kubu radish kimchi. He recalled attending a magnet high school where all his friends were Korean and even had a Korean girlfriend.
Message to Young Koreans
Karp encouraged young Koreans and investors to stick to their guns, emphasizing the uniqueness and value of Korean culture. He expressed confidence in helping Korean culture shine even more through collaboration and innovation.
