Riding High
The Korean startup industry reportedly attracted more than 10 billion won (US$8.6 million) of investment per month during the first quarter of this year, centered on the fields of Online to Offline (O2O) services and shopping.
According to industry sources on July 28, local venture firms raised more than 10 billion won of investment five times during the first quarter of 2015. If investment worth over 5 billion won (US$4.3 million) is included, 5 to 10 billion won of investment was made 8 times in total for six months.
Considering Woowa Brothers, which runs Baedari-Minjok, was the only company that raised over 10 billion won in the first quarter of 2014, the number of recognized venture firms increased in 1 year. This year, the local startup industry is witnessing an increase in investments between 2 billion and 10 billion won compared to last year, going beyond early investments of less than 2 billion won (US$1.7 million).
This trend is expected to continue in the latter half. Three cases of investment worth more than 5 billion won were already reported in July alone. Viva Republica, which created simple payment service Toss, is said to have raised 5 billion won (US$4.2 million). YAP company, which operates O2O platform YAP, attracted 42 billion won (US$36 million). Yanolja, which provides information on accommodations, also reported 10 billion won of investment (US$8.6 million).
In particular, companies that provide O2O and shopping services attracted investment most this year. As for the O2O area, Channel Breeze, which operates apartment and home rental app Zigbang, was the first company that attracted around 20 billion won (US$17 million) of investment, followed by restaurant review start-up MangoPlate with 6.7 billion won (US$5.8 million) of investment, and social location service SeeOn with 8 billion won (US$6.9 million). In addition, YAP company and Yanolja attracted a large-scale investment as well.
In the shopping area, Memebox, which received attention last March with the investment of Jerry Yang, co-founder of Yahoo, raised 33 billion won (US$29 million) of investment. HomeShopping Moa, which provides information on home shopping, also attracted 6 billion won (US$5.2 million) of investment. Industry analysts are saying that a large-scale investment will continue in the latter half, and that venture firms are likely to launch aggressive marketing campaigns.