The South Korean startup industry has been thriving because of innovative ideas, enterprising founders and an amiable support system both through domestic and international ventures. From e-commerce, blockchain, Artificial Intelligence, Virtual Reality, FinTech to agricultural innovations, South Korean startups have dabbled in multiple areas successfully.
Korean Chat API startup Sendbird announced in first quarter 2021 that it has raised $100 million in Series C funding and the makes the company’s valuation to $1.05 billion. Sendbird is now one of the 12 unicorn startups based out of South Korea.
In October 2020 ride-sharing company Socar achieved the coveted status. In 2019, 11 Korean startups achieved the unicorn status putting South Korea at the 4th place among the countries with most startups and in the same league as the US, China etc.
What is a unicorn status in the startup ecosystem? It is basically a startup or company whose value reaches over a billion dollars. The strong infrastructure, venture boom, government support and tech growth in Korea are the reasons why the country is among the top 5 nations riding the phenomenal unicorn wave. The government envisages the number to reach 20 unicorns by 2022.
Koreatechdesk.com shortlists top Korean startups that have joined the billionaire club and are soaring high on success:
1) Coupang – Valuation – $9 billion; Funds Received – $ 3.8 billion
Dubbed as the ‘Amazon’ of South Korea, Coupang is the fastest growing e-commerce startup. Founded in 2010, it is the largest online retailer selling products from electronics to food to over 120 million consumers. The startup is popular for its ‘Rocket Delivery’ that promises delivery in 24 hours and ‘Dawn Delivery’ service that offers mid-night orders delivered by morning at 7 am.
Named one of the ‘50 Smartest Companies in the World’ by MIT Technology Review and ‘30 Global Game Changers’ by Forbes, Coupang is the fastest growing e-commerce startup. For the reason, it is dubbed as the ‘Amazon’ of South Korea. Founded in 2010, it is the largest online retailer selling products from electronics to food to over 120 million consumers.
In 2018, Coupang received $2 billion in funds from SoftBank’s Vision Fund, which made the startup’s valuation at about $9 billion. SoftBank had made an initial investment of $1 billion in the startup in 2015. The other significant investors for Coupang have been Sequoia Capital, Founder Collective and Wellington Management.
Coupang’s CEO Bon Kim previously worked at the Boston Consulting Group. Before Coupang Kim had founded Vintage Media Company, which he sold in 2009. Kim had joined as a speaker at beGlOBAL SEOUL event in 2013, organized by beSUCCESS media group.
Coupang was named one of the “50 Smartest Companies in the World” by MIT Technology Review and “30 Global Game Changers” by Forbes.
In September 2020, announced to establish a large high-tech logistics center in Gwangju Metropolitan City for storing fresh food at the same time, and the total investment cost alone amounts to 224 billion won ($188 million). The “Coupang Gwangju Pyeong-dong 3rd Advanced Logistics Center” has a floor space area of 48,000 pyeong and aims to start construction in the first half of next year and complete it in the first half of 2023.
2) Woowa Brothers – Valuation – $5 billion, Funds Received – $457.8 million,
Woowa Brothers that attained unicorn status in 2018, got a great deal with a successful takeover by German company Delivery Hero for $4 billion in 2019. The acquisition, termed as the largest food delivery service deal globally, is considered as the most significant of inbound investment in the South Korean startup and technology sector.
Woowa brothers started with the leading food delivery app in South Korea called ‘Baedal Minjok’. In December 2018, the startup achieved the ‘billionaire status with an investment worth US $320 million from the private equity firm Hillhouse Capital, US-based Sequoia Capital and GIC, Singapore’s sovereign wealth fund.
Founded in 2010, Woowa Brothers’ food delivery app is popular in South Korea where 7 out of 10 people order food via apps. Baedal Minjok’s monthly number of orders had reached over 20 million in July 2018, growing from 5 million in early 2015.
Woowa Brothers had several series of large investments, including 57 billion won or $50.7 million from the current investor Hillhouse Capital. In 2014, Goldman Sachs put in 40 billion won or $35.6 million in the firm.
KimBong-jin, CEO and Founder of Woowa Brothers attended beGlOBAL SEOUL 2015 as a prominent speaker sharing his experience with upcoming startups. With the acquisition by Delivery Hero, Kim Bong-Jim becomes the Chairman of the Board of Directors and Executive Director of the Joint Venture in the Asia Pacific region.
In 2020, in the era of ‘untact’ deliveries, Woowa brother’s delivery robot “Delidrive” is ready to do delivery rounds. It is capable of carrying 25 liters of loads, weighing as heavy as 30 kgs (67 pounds).
3) Viva Republica (Toss) – Valuation – $1.2 billion ; Funding Received – $248.10 million
FinTech Korean startup Viva Republica is the pioneer in the peer-to-peer money transactions market that has grown exponentially in South Korea. The company manages the popular P2P mobile payment app ‘Toss’. The app has grown to over 10 million registered users within three years. Toss now has about 20% of South Korea’s population as its users. The P2P app allows users to transact about $1822 per day. The startup claims to have reached a $18 billion transaction rate in 2018.
The company was founded in 2011 by dentist Seunggun Lee and ‘Toss’ was launched in 2015. Toss is proving to be a much more beneficial and easier option for financial transactions as compared to the banking system, where security protocol is complex and the money transfer process is cumbersome. Viva Republica, the creator of mobile financial secured $64 million at a valuation of $2.2 billion by Hong Kong-based equity investment firm Aspex Management last year.
Toss is proving to be a much more beneficial and easier option for financial transactions as compared to the banking system, where security protocol is complex and the money transfer process is cumbersome.
Viva Republica announced in August 2020 that it has raised $ 173 million in new funding led by key existing investors to fully drive its new initiative and become a one-stop app for all financial needs.With the largest single investment raised in the midst of global market turmoil due to the COVID-19 pandemic, Toss is now valued at US $ 2.6 billion and has secured a total of US $ 530 million to date.
4) Yanolja – Valuation – more than$1 billion; Funds Received – $ 241.9 million
This Korean startup that has made its mark in the hotel and accommodation industry has recorded an annual growth of 150% over ten years period without any foreign investments. It became ‘unicorn’ in July 2019 with Series D investments of $180 million from GIC, a Singapore sovereign wealth fund, and US firm Booking Holdings. The company had earlier raised around $60 million.
Yanolja is known for its reinventing of spaces turning them into love hotels – an attractive accommodation for short-stay travelers and young people. The startup was founded in 2005 by a former hotel worker Lee Su-jin. The company was started as an advertising platform for love hotels before becoming an app-based booking service. Now its services include Yanolja Accommodation, Yanolja Dangil (same day bookings), and Yanolja Pension. The startup now has more than 200 hotels in Korea and has overseas expansion as well, with partnerships with Zen Rooms, Agoda, and Booking. With growth and investments, the company is aiming to launch an IPO this year.
On March 20, 2020, the startup announced that it has seen a revenue growth of more than 70 per cent for the fifth year of operations. The company is optimistic about its future despite current economic meltdown. The startup logged a total revenue of $260 million, which is 78.8 percent up from the previous year.
5) WeMakePrice – Funds Received – $390 million
This is one more E-commerce platform in South Korea that has achieved the unicorn status. The startup that is similar to Groupon sells a variety of consumer goods online. Launched in 2010, the company’s vision is quite clear – “We save our customers’ money and time”.
To make the shopping experience easier and affordable, WeMakePrice gets its supplies directly from wholesalers and encourages bulk buying deals. The e-commerce platform made $5.36 billion worth transactions in 2019. The company has been funded by investors NEXON Corporation, IMM Investment and NXC.
6) Socar – Valuation $872.6 million/ One Trillion won
Adding to the ‘unicorn’ list of Korean startups latest is the car sharing company Socar. On October 16th, the company attracted 60 billion won of funding from investors, achieving unicorn status with a corporate value of 1 trillion won or $872.6 million.
Socar started its ride sharing business in 2011 with 100 rental cars. In 2018, it acquired mobile messenger startup VCNC to launch van-hailing service Tada. Tada had to cease regular operations this year due to new legislation, but it still runs a premium service. Now, Socar has grown to 120,000 vehicles with the number of subscribers exceeding 6 million. The company’s revenue last year came to 256.6 billion won, up from 121.1 billion won in 2017.
7) Musinsa: The online fashion platform has garnered huge success especially among the Korean youth. Musinsa provides fashion brands through collaboration and special promotional events besides a regular selling of fashion cloths and accessories. Munsinsa also runs a special magazine for its users to assess new brands with latest information. Founded in 2001, it has investments from Sequoia Capital, LB Investment, IMM Investment.
In May 2021, the fashion unicorn startup Musinsa acquired a 100% stake in fashion platform StyleShare and 29CM. The acquisition scale is $265 million or 300 billion won. The acquisition will help Musinsa become a global seller for K-Brand.
8) Aprogen: It is the first Korean biotech startup to become a unicorn. Founded by KAISE (Korea Advanced Institute of Science and Technology) professor Kim Jae-seob, Aprogen produces Remicade biosimilar that treats autoimmune diseases such as rheumatoid arthritis and Crohn disease. Aprogen’s investors include Linderman Asia Investment and Nichi-lko Pharmaceutical.
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