We publish reports on investment and the latest Korean startup trends. This report is limited to Korean startups (including news on their foreign entities or investments that Korean VCs make in foreign startups). All data is up to date as of the release date of this article.
A total of approx. USD 30M worth of startup investment was made this August, with a focus on the deep-tech industry
This past August, 28 investments were made in startups, amounting to around USD 30M (the exact amount for 11 investments were not disclosed). The cumulative investment amount for this year was around USD 60M in July, USD 100M in June, USD 38M in May, USD 19M in April, USD 72M in March, USD 37M in February, and USD 21M in January. This month, nine out of the 28 companies that received investment are in the deep-tech sector. 6 of these deep-tech companies are developing artificial intelligence technology. This shows the level of interest that this sector is garnering from investors.
The company that attracted the biggest investment this month is the media commerce company, Women’s Talk. Women’s Talk announced on July 28 that it received around USD 7M of investment from 6 different investors, including Seoul Investment Partners. Until now, Women’s Talk has cumulatively raised around USD 11M. After launching its service in July 2015, it has attracted 1 million active monthly users and 820,000 registered users. The company produces images of creators with fashion and beauty brands that users can purchase through this platform.
In its early days, Women’s Talk was popular for offering a variety of beauty products at the lowest price. This was possible due to their unique distribution structure, wherein creators making video content get a certain amount of commission and the brands are able to get resources that they can use as marketing content. Instead, brands offer products to Women’s Talk at the lowest price, which is a lot lower than other shopping malls. The video content is distributed to various channels including Women’s Talk’s own applications–Facebook, Naver, KakaoTalk and others, with around 2 million followers.
The next company is Jubilee Works, which is developed the scheduling service Jubilee Timetree. In the recent investment round, they raised around USD 5M from K Cube Ventures, Cognitive Investment, and other investors. Jubilee Works is a company founded in September 2014, by the ex-CEO of Kakao Japan, Cha-Jin Park, along with ex-employees from Kakao Japan and Yahoo Japan.
Jubilee Timetree, which was officially launched in March 2015, is a calendar-sharing service for small groups, such as families, companies, couples, or groups for extra-curricular activities. In July of this year, Jubilee Time Tree reached 5 million subscribers and the weekly retention rate for Japan was around 85%. For iOS, it is showing steep growth in Asia in countries like Japan and Korea. For Android, they are growing fast in Europe, in countries like Germany. Currently, they are offering services in 13 different languages. Also, they are planning to develop APIs that make it easier for businesses, government offices, and organizations to easily create public events and make them viral.
Ice & V, the developer of the fishing O2O platform Half Water and Half Fish (Moolban Gogiban), received around USD 5M from Korea Investment Partners, Huayi Brothers Korea, and other investors. Half Water and Half Fish is a reservation application for fishing locations in Korea. It also offers recommendations for fishing locations; users can search over 4,000 fishing points and use the phone reservation. They recently updated a free smart measurement feature called ‘length measurement’. This feature makes it possible for users to measure the size of fish on the spot, without having to pick up a tape measure while fishing. They are preparing a major update for the app, where users can check weather on the app and also reserve on real-time basis.
Last year, Angel investment exceeded USD 200M and the average annual growth rate for the past 3 years was 41.2%.
According to the announcement from the Ministry of SMEs and Startups, by the end of 2016, the total amount of investment made by Angel investors was around USD 200M (3,984 investors made personal investments, totalling around USD 165M). This was the highest in terms of both the number of investors and the investment amount since 2004, when investment activity decreased dramatically after the venture bubble popped. Private investment has shown a remarkable increase since 2010, especially in the last three years (2014 -16) with about a 41.2% increase. Considering the fact that the application for income tax deduction for investment in 2016 is possible by 2019, the actual size is expected to be much larger. Individual investment unions, which have advantages in terms of expertise in investment, economies of scale, risk mitigation, portfolio composition, etc., have been steadily expanding. The number of private investment unions has been growing since 2013, and, as of June 2017, there are 273 private investment unions with a total fund size of around USD 130M. Compared to the end of 2015 (89 unions, fund size of 40M), there has been a 206.7% increase in the total number of unions and 209% increase in the fund size. The total fund size of private investment in 2016 alone reached a record high of USD 36M. The amount of cumulative investment is around USD 85M.
(Top photo from Pixabay)
This article, entitled “Startup financing in South Korea in August: deep-tech industry leads the USD 30M investment”, was written in Korean by Margot Jung of Platum, edited by AllTechAsia.