With the year slowly coming to a close, let’s take a look back at how ten South Korean startups in 2020 overcame challenges such as COVID-19 and how they changed gears to adapt to the new normal in business and everyday life. It’s been a difficult year for people across the world. However, startups – such as the ones highlighted below – continue to find new opportunities in the face of the crisis, rising to the challenge and achieving new heights of growth.
Even high-end and popular fashion brands suffered significant drops in sales as a result of the pandemic. However, the circumstances proved to be a major opportunity for online fashion brands as well as for brands that used their online platforms to achieve more than just an online presence.
Fashion startup Must It raised 15 billion won ($12.45 million) in Series A funding. Established in 2011, the company impressed investors with an 80% growth rate and positive financial statements every year without the need for external investment. CEO Yong Min Jo said Must It’s consistently high growth was possible because the company focused on the essence of commerce itself.
While South Korea has relaxed its restrictions on social distancing since October (residents are still required to wear masks in all public spaces), people are still hesitant about using everyday services that require in-person interactions. Laundrygo is one of the startups that helps meet the everyday needs of residents. It provides same-day laundry service with a trackable laundry basket, avoiding all physical contact.
The company raised 17 billion won ($13.9 million) in Series B investment this year from major investors including Korea Investment Partners, Aju IB Investment, KT Investment, Samsung Venture Investment, DS Asset Management, Altos Ventures and Hana Ventures. More such everyday services are expected to hop onto the online platform.
A game changer in South Korea’s fintech industry, Toss is the leading mobile finance solution offered by unicorn startup Viva Republic. Despite COVID-19’s impact on businesses across all industries, Viva Republica managed to bag a massive investment worth $173 million in Series G round.
Key investors including Aspex Management, Sequoia Capital China and Kleiner Perkins Digital Growth Fund participated in the funding round. Furthermore, Toss reportedly is valued at $2.6 billion and has secured a total of US $ 530 million in investments.
Kurly is one of the leading grocery delivery service startups in South Korea that uses a marketplace model to link consumers with retailers. Kurly Market delivers quality products through its same-day and next-day delivery options to customers that place value on convenience over cost-saving.
Although there were reports discussing Kurly’s potential acquisition, the company dismissed them by raising $150 million in Series E investment this year. Kurly’s valuation stands at $780 million and it has raised about $346 million in total investment.
Most schools and universities in the country are still taking strict social distancing measures, holding classes and lectures largely on Zoom or similar online conference platforms. Stimulating online educational platforms and services for teachers and students continues to be a major need as schools adjust to the new normal in education. Edutech startup Riiid released popular mobile-based TOEIC test app Santa in 2017.
Santa uses AI technology to analyze student data and content, predict scores and user behavior to produce better questions, and provide student feedback. This year, the company raised $41.8 million in its pre-Series D funding round.
The funding round was led by Korea Development Bank (KDB), Intervest and IMM Investment. Riiid has secured $70.2 million in total investment. Riid plans to put its funding into improving its proprietary deep learning technology.
Danggeun Market – developer of mobile-based peer-to-peer marketplace and community app Karrot – secured $33 million in Series C funding this year led by Goodwater Capital and Altos Ventures. According to Tech Crunch:
“Danggeun Market says its monthly active users have grown 130% year-over-year, reaching seven million in April and making Karrot the second-largest shopping app in South Korea after Coupang, the country’s largest e-commerce platform. Users spend an average of 20 minutes per day on the app, and gross merchandise value increased by 250% year-over-year, despite the COVID-19 pandemic.”
With Karrot, users can find listings for products that can be purchased (in-person transactions or mail order) within a six-kilometer radius. Services such as a smartphone application give Danggeun Market its competitive advantage.
As a result of social distancing, food delivery companies in the country saw a major boom in orders, resulting in a significant increase in food delivery and plastic waste. To tackle this, Green startup Superbin has developed Nephron, a reverse vending machine, which rewards you monetarily when you recycle plastics using it.
Recently the company secured 20 billion won ($16.8 million) in Series B funding from big investors including TBT, Humax and Fine Investment, as well as Sae-a Global, who participated in the round as a strategic investor.
The tourism and travel industries have taken a severe hit from the pandemic. Travel booking startup MyRealTrip was no exception to this as it reportedly generates 90% of its revenue from overseas travels.
However, the company was quick to adapt to challenging circumstances as it shifted its business strategy to focus on promoting domestic trips to customers. With this move the startup reaped profits and recently raised 40 billion won ($36 million)
Seegene was one of the first biotech firms that responded to the initial news of the coronavirus outbreak in Wuhan, China, anticipating its potential to grow into a full-blown global threat. According to a feature on the startup by Forbes, Seegene CEO Chun Jong-Yoon halted all other projects and had his team focus on developing diagnostics kits for the virus starting January.
Within just two weeks, Seegene produced its first test kit. The South Korean government responded quickly, with the Korea Centers for Disease Control and Prevention (KCDC) approving it. This initiative was a major achievement for both the firm and the country. Such efforts normally take longer to actualize but this joint effort definitely helped South Korea survive the worst of the outbreak and provide aid to countries around the world.
MiCO Bio Med, like Seegene, was fast to act as the pandemic began to spread in the country rapidly. In February, it reportedly developed a rapid molecular diagnostic system that can detect the virus within an hour. The system is designed to be used at airports and port quarantine centers.
MiCo BioMed, owned by scientist and CEO Kim Sung-woo, is involved in research and development involving molecular diagnostics, biological chemistry and immunoassay diagnostics technology. According to a Korea Herald article:
“The company developed 30 different kinds of high-risk pathogen diagnostic kits with the Korean Centers for Disease Control and Prevention. Some of them were used to detect bioterrorism pathogens in mobile vehicles during the 2017 U-20 World Cup Games, 2018 PyeongChang Winter Olympics and 2019 Gwangju Asian Swimming Games.”