Yanolja, the fastest-growing Seoul-based accommodation, leisure, and travel activity booking startup, is set to get one of the biggest booster shot investments as SoftBank Group’s Vision Fund announced its plan to pick up a stake in the company. As per a report by the Seoul Economic Daily, the world’s largest venture capital fund has set an $800 million fund to acquire a 10% stake in Yanolja.
Investment news brings cheer to the market
This news has already brought cheer to the market as companies that have invested in Yanolja saw their stock prices rising. SBI Investment, Daesung Private Equity, DSC Investment, Aju IB Investment, and Woori Capital saw their stock prices go up. GIC, Singapore’sSingapore’s sovereign wealth fund, and US travel company Booking Holdings currently hold a combined 35 percent to 40 percent stake in Yanolja with a total investment of $180 million. According to the company, Partners Investment, Murex Partners, Aju IB Investment, SBI Investment, SL Investment, and SkyLake Investment are Yanolja’sYanolja’s Korean investment partners.
The investment of about 1.18 trillion won by Vision Fund, led by SoftBank Chairman Son Jeong-eui, will be the first such sole significant investment in a domestic company in Korea. Yanolja, which has been working on going public in the near future, is likely to accelerate its speed for a dual IPO – one in the domestic stock market and a listing on NASDAQ. In 2020, Yanolja chose Mirae Asset Securities as its lead underwriter and Samsung Securities as co-underwriter for a local IPO. However, as per local media reports, it is very likely Yanolja may prefer a US IPO only over a Korean debut. Hence, the company might use the latest funds to expand its core businesses to more Southeast Asia countries and to go public in the United States in 2023.
Decacorn in the making
The negotiations for the investment and stake acquisition between Vision Fund and Yanolja were reportedly going on since May 2021. When this investment goes through, likely sometime next week, as per reports, Yanolja, a unicorn company, shall become a potential candidate for a Decacorn status (a company with a $10 billion valuation). It will be a significant achievement for a Korean startup and travel company, especially when the travel industry is reeling under the impact of COVID-19 pandemic-induced losses.
Yanolja, founded by Lee Su-jin in 2005, is known as a ‘Super App’ in the online travel business. It provides all services in the travel and leisure sector including accommodation, and transportation in Korea. The 15-year-old startup offers reservations at accommodations in more than 170 countries worldwide and is a dominating player in the local tourism industry, with over 12 million users in Korea using the platform.
Cloud technology & business diversification
The travel platform’s cloud-based technology is helping in its growth and set it ahead of its competitors. Recently, Yanolja launched a new corporation, ‘Yanolja Cloud,’ composed of its affiliates eZee Technosys, ZEN Rooms, Affiliated Information Technology, and Truststay. Yanolja Cloud is currently providing B2B operation solutions in more than 60 languages to more than 30,000 customers in 170 countries worldwide.
While the COVID-19 pandemic hit the travel industry companies the worst, Yanolja was able to stand through the storm. Last year, Yanolja recorded 192 billion won in sales, a 43.8% increase compared to the 2019 sales of 133.5 billion won. Last year’s operating profit for Yanolja was 16.1 billion won, achieving a turnaround compared to the 2019 operating loss of 6.2 billion won. It was on a full-fledged growth trajectory by introducing cloud solution-based automation processes and digital transformation. Yanolja made a good stride in 2020 with data from Wise App, a data analysis service showing a growth of about 4 percent in year-on-year sales. Many Koreans opted to travel to local destinations over overseas trips.
The funding boost will help Yanolja for business diversification and launch an IPO by carrying out additional M & M&A with the investment proceeds. In all likelihood, just like Korean startup Coupang’s sensational IPO debut at the US stock market, Yanolja may leap to get listed in the US in the coming time.
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