[StartupRecipe] K-Beauty Startups’ Rise in a Shrinking Market

Access to the latest Korean startup news and startup database for free

#Weekly Funding Overview

#FUNDING

#TREND ANALYSIS

K-Beauty Startups’ Rise in a Shrinking Market

While the broader startup investment landscape in Korea has seen a general slowdown, the K-beauty sector stands out with its consistent and robust influx of capital. This resilience highlights the industry’s unique appeal, even in challenging economic times. Recent successes underscore the promising trajectory of K-beauty ventures. Last year, APR made a successful public debut, followed by Dalba Global this year. These IPOs demonstrate the strong potential within the sector, with both companies fueling their growth through overseas sales and leveraging high global demand. Their stock prices have been on an upward swing, serving as inspiring benchmarks for emerging startups. This momentum is fostering a positive cycle, encouraging the rise of more innovative players in the space.

As K-beauty’s growth prospects continue to broaden, collaborative programs between public and private entities are scaling up to nurture startups. Private firms are proactively investing in early-stage technologies and market potential, while government and local bodies are bolstering institutional and financial aid to boost overall industry competitiveness. Key examples from the private side include initiatives by CJ Olive Young in partnership with Korea Kolmar, L’Oréal Korea, and Amorepacific. These programs identify startups with cutting-edge innovations and assist in bringing their ideas to market. On the public front, the newly launched Seoul Beauty Hub exemplifies dedicated support for beauty enterprises, offering resources to help them thrive.

Investment trends in K-beauty are evolving beyond traditional cosmetics brands, now encompassing the full spectrum of the industry—from raw materials and clinical testing to distribution and innovative solutions. This shift reveals the directions in which startups are innovating, with a strong emphasis on global strategies. Many are drawing funds from international investors and strategic partners, signaling confidence in their worldwide appeal.

This year, several standout companies have secured significant funding, each showcasing unique strengths and global ambitions. Memebox raised 10.5 billion won, marking it as the first Korean firm to receive investment from Y Combinator. The funding builds on its proven track record in the U.S. market and support from global venture capital. ActivOn, a specialist in cosmetics raw materials, attracted 10 billion won by excelling in sunscreen and functional ingredients. With major clients like L’Oréal and Johnson & Johnson, the company is generating buzz for a potential IPO. Hemeko, a content-driven commerce startup, integrates a makeup-focused community with its proprietary brand and secured 5 billion won from global VCs to fuel international growth. PO:DL, founded by a seasoned entrepreneur, quickly captured market share and raised 3.5 billion won from strategic investors such as Coupang and GS, aimed at global expansion. NuriHaus, as a K-beauty export platform, garnered 3.5 billion won and is engaging the global market through partnerships with over 80,000 creators across 100 countries. Benow, a cosmetics brand, achieved over 260 billion won in sales last year and is poised for an IPO, bolstered by corporate investments.

The influx of diverse capital—from global VCs to conglomerate funds—is elevating the industry’s overall potential. Aligning with this, the government is rolling out targeted measures like K-beauty funds, loans, and the 100-UP project to enhance financing, fund creation, and overseas expansion support. These efforts suggest that K-beauty’s upward trend is set to persist, promising continued innovation and opportunity.

#MORE NEWS

• Humanoid Robotics Startup AeiROBOT Secures 10 Billion KRW in Series A
• Beyond Honeycomb Secures KRW 10B to Scale AI Cooking Robot GRILL X
• K-beauty company MBX Secures $6.5M to Fuel Global Expansion