Start-ups attract 1 trillion won in investments

Korean start-ups raised more than 1 trillion won in investments last year, according to an annual report by a research team at Platum, a start-up media outlet. Beauty brand Memebox received the largest investment of 143 billion won ($126.2 million).

A total of 313 Korean start-ups were funded last year, which is 49 percent higher than the 233 cases in 2015. In investment volume, this amounted to almost 1.01 trillion won, 23 percent higher than the previous year’s 812 billion won.

Memebox’s funding last year worth 143 billion won came mostly from U.S. venture capital funds. The beauty e-commerce operator also led in receiving the largest amount of investment at once, a combined 73 billion won in August from Formation Group and Goodwater Capital.

Woowa Brothers, developer of the food delivery service app Baemin, received investments worth 57 billion won from China’s Hillhouse Capital Group, one of the biggest investment firms in Asia. Webtoon site Lezhin Comics’ parent company, Lezhin Entertainment, followed with 50 billion won in investments from Korean private equity firm IMM.

Yello Mobile and its marketing subsidiary Yello Digital Marketing ranked fourth and fifth with investments worth 47.8 billion and 27 billion won each. The company’s Coocha enables consumers to see all products in Korea’s major e-commerce sites organized in a single platform. Pikicast, its popular web content publisher, is similar to the U.S.’s BuzzFeed.

The ranking was slightly different for the total amount received between 2014 and 2016: Yello Mobile was No. 1 at 217.7 billion won, Memebox second at 176 billion won and Woowa Brothers third at 109 billion won. Platum first started collecting data for the report in 2014.

By industry, ICT (information and communication technology) services attracted the most investors and funding. A total of 173 start-ups in the list were engaged in the sector, taking up 55 percent of the list of 313 companies. This sector also received the biggest amount of investments, worth 451.6 billion won. But in terms of year-on-year growth rate of investment volume, the retail and services sector posted the sharpest uplift thanks to Memebox, jumping threefold from 2015 to 222.4 billion won this year.

Last year, 249 investing companies offered funding to Korean start-ups, among which 80 percent were Korean and 20 percent from overseas, mainly from the U.S., Japan and China. Among 43 foreign investors, half were from the U.S. while Japan and China both accounted for about 25 percent.

BY SONG KYOUNG-SON [song.kyoungson@joongang.co.kr]