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Alibaba invests $71M in e-commerce platform Ably in bid to expand in Korea

Published: 03 Dec. 2024, 17:28 Updated: 03 Dec. 2024, 18:16

CHO YONG-JUN
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Ably Corporation's Ably is a popular fashion platform that started in 2018. Specializing in women’s clothing, Ably features many small or lesser-known clothing brands. It also operates 4910, a platform for men’s fashion, as well as amood in Japan. [ABLY CORPORATION]

Alibaba Group invested 100 billion won ($71.2 million) in Ably Corporation, a Korean startup that operates e-commerce fashion platforms Ably and 4910, in an attempt to further expand in the Korean market.

The investment, announced Monday, marks not only the first overseas investment in Ably Corporation but also the first time the Chinese giant has acquired a stake in a Korean e-commerce platform. The exact number of shares acquired by Alibaba Group was not disclosed.

The group deemed the company to have a corporate value of 3 trillion won, making Ably Corporation a unicorn, according to the Korean e-commerce firm.

Ably is a popular fashion platform that started in 2018. Specializing in women’s clothing, Ably features many small or lesser-known clothing brands, and achieved 1 trillion won in total transactions as of early 2024. The platform boasted 8.78 million monthly active users as of October, according to data from market tracker WiseApp. The parent company also operates 4910, a platform for men’s fashion, as well as amood in Japan.

Ably Corporation aims to use the investment to expand its overseas business beyond Japan, with plans of attracting investments worth 200 billion won from U.S.-based firms and sovereign wealth funds, according to the company.

“Alibaba has a solid pipeline for [Ably] to utilize and expand into Europe and other countries in Asia,” the company said Monday.

Alibaba Group’s investment follows aggressive investment into Alibaba and its overseas-focused e-commerce platform, AliExpress, in Korea in the last couple of years. AliExpress introduced K-venue in October 2023, a dedicated platform for Korean sellers to offer their products in the domestic market, and announced in September that it will exempt commission fees for local sellers that join its new program designed to help sellers export Korean products overseas.

AliExpress is estimated to have an average active user count of 9.68 million as of November, an increase of 6.9 percent compared to the previous month, to rank as the second-most popular shopping app in Korea, behind only Coupang, according to data from WiseApp on Monday.

The competition with fellow Chinese e-commerce platform Temu is fierce, which has an estimated monthly active user base of 7.33 million, an increase of 7.9 percent from the previous month to rank fourth.

Chinese IT giant Tencent has used a similar tactic to enter the Korean market and expand into the global market, as the company invested 533 billion won into Netmarble — then known as CJ Games — and has acquired stakes in video game publishers Krafton and ShiftUp in subsequent years.

“It’s positive to have Korean sellers expand in the global market using Alibaba’s platform,” Sejong University Business Management Prof. Lee Dong-il told the JoongAng Ilbo, an affiliate of the Korea JoongAng Daily.

“But the danger of [Korean e-commerce platforms] turning into a platform that advertises Chinese products should be noted.”

Alibaba announced on Nov. 21 that the company will establish the Alibaba E-Commerce Business Group. The new entity integrates various local and overseas e-commerce platforms under Alibaba Group, including Taobao, Tmall, AliExpress and second-hand trading platform Idle Fish, to raise its competitiveness against Pinduoduo, the parent company of Temu and ByteDance, which operates TikTok.

BY KIM NAM-YOUNG, CHO YONG-JUN [[email protected]]