7 South Korean Startups You Should Know
7 South Korean Startups
With a tech-savvy population and a $3 billion investment from the government, South Korea could be the perfect place to launch a startup.
And the country certainly has a reputation as an innovative tech powerhouse. But according to the Financial Times, the country isn’t content to rest on their laurels. In fact, many South Koreans feel the country is inadequate at fostering and protecting technology innovation.
Another concern is Samsung, which accounts for more than 20% of the market value of the Korean Stock Exchange. The company has experienced a rough 12-months, with the release, then recall, of some combustible phones, as well as the recent arrest of company vice-chairman Lee Jae-yong on bribery and perjury charges.
But South Koreans are survivors, and the country shouldn’t need to rely so heavily on one tech company anymore. Startups are booming, venture capitalists are increasing investments, and the government is loosening regulations and increasing support for business. And there are plenty of startups already getting noticed for the right reasons. Here are seven to keep an eye on.
Every country, it seems, has their own food delivery startup, and in South Korea it’s Baedal Minjok, which translates to “Delivery Nation”. Baedal Minjok and GrubHub have a lot in common – they’re both looking internationally for expansion and Goldman Sachs is helping both companies with their growth. Owned by Woowa Brothers, Baedal Minjok has received $98 million in funding, with $36 million coming from Goldman.
“Korea is one of the most attractive e-commerce markets in the world. This investment in Baedal Minjok’s innovation and talented management team exemplifies Goldman Sachs’ aim to partner with Korean corporate leaders who are able to expand globally,” according to a statement from Goldman Sachs on TechCrunch.
Goldman Sachs is also an investor (to the tune of $33 million) in Zig Bang, a startup that solves a universally annoying problem for city dwellers – searching for an apartment. The company says it has had over 10 million app downloads and has received $75 million in funding.
Unlike many other developed countries, South Koreans have fully embraced banking on their phones and Viva Republica has capitalized on that phenomenon with Toss, often referred to as South Korea’s Venmo. “We see great opportunities in the country’s financial services sector, where 90% of banking transactions are done mobile or online,” Viva Republica founder Lee Seung-geon told the Financial Times.
The app is one of the top-five payment apps in Asia and has raised nearly $3 million in funding and performed $3 billion in transactions. The company recently launched a micro loan service.
This startup holding company is one of South Korea’s unicorns and is rumored to be heading toward an IPO. The company has launched or purchased 50 startups including Coocha (a shopping search app), Pikicast (a digital media content platform), and 1km (a dating app). It’s not all fun and games over at Yello Mobile, though, as Elaine Ramirez, a reporter covering South Korea’s tech and startup scene, wrote in Forbes – the company had a $4 billion valuation in 2015 but even after four new loan investments the valuation didn’t budge.
Socar, an eco-friendly car sharing company, has a slightly different model than companies like ZipCar in the states–commuters can book and share cars with others traveling at the same route. Uber failed in the country, so the service doesn’t have much in the way of competition. SoCar has raised $18 million in 2014 with funding led by Bain Capital.
As Ryan Mac at Forbes wrote, Coupang is a big reason Amazon is avoiding South Korea entirely. “In two years Coupang has built a last-mile delivery network of customized trucks, algorithm-controlled warehouses and 3,600 ‘Coupangmen’ who deliver goods and chat up customers,” he wrote. “For South Korea, where the average package takes two or three days to arrive at a customer’s door, Coupang can get most of its orders to a shopper’s front steps in a day or less at no extra charge. You can cancel an order that’s already on its way or change a package’s destination at the last minute. Try that with Amazon.”
E-commerce beauty company Memebox decides which products to sell or create using data it collects on sales and feedback. And the concept has appealed to investors–they’ve raised over $156 million. Despite the name, much of the company’s business does not come from subscription boxes, like US startup Birchbox. Rather the company operates more as traditional online retailer, though they’ve also recently opened a brick-and-mortar location.
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