[StartupRecipe] South Korea’s Top 3 Seed VC Investment Sectors

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#Weekly Funding Overview

#FUNDING

#TREND ANALYSIS

South Korea’s Top 3 Seed VC Investment Sectors

An analysis of early-stage funding in South Korea’s startup ecosystem reveals a clear concentration of capital in three sectors: artificial intelligence (AI), robotics, and consumer technology. Based on data from Startup Recipe, which covers 29 seed-stage companies that disclosed funding through the third week of September, total investment reached KRW 137.8 billion. This period revealed a distinct polarization, with a few large-scale deals coexisting with numerous smaller investments, driving an average deal size of KRW 4.7 billion. The data suggests a trend towards global competitiveness from an early stage, particularly as companies leveraging deep technological capabilities have attracted significant interest from global investors and large corporations.

The three leading sectors are AI, robotics, and consumer tech, which accounted for the majority of this total investment. The AI sector led the market in both deal count and total investment with 10 deals totaling KRW 65 billion, including significant raises for FriendliAI at KRW 27.5 billion, Solomon Labs at KRW 16 billion, and Pickle at KRW 6 billion. Investors appear to be focusing on vertical AI solutions tailored for specific industries, such as tax services, video editing, and defense. This reflects growing investor confidence in the commercialisation of generative AI and its applicability in B2B markets.

Following AI, the robotics sector attracted KRW 31.4 billion across just four deals. This resulted in the highest average investment size at KRW 7.85 billion, a trend that points to robust demand for automation from the manufacturing and service industries. Notable investments include RLWRLD at KRW 21 billion and CarbonSix at KRW 6 billion. Realworld’s funding round was particularly significant, as it included strategic investors like LG Electronics and SK Telecom alongside international firms such as KDDI and ANA Holdings, underscoring high expectations from industrial players. The consumer tech sector also drew a substantial KRW 24.5 billion across only three deals, yielding the highest average investment per deal at KRW 8.17 billion. This demonstrates a clear trend of capital concentrating on a small number of top-tier startups, exemplified by Best Innovation, a premium aesthetics platform that secured a KRW 23 billion investment.

The data further shows that startups with proven technology and clear business models are securing high valuations even at the seed stage. Three deals exceeded KRW 10 billion, and ten more were in the KRW 3–10 billion range, together accounting for 45% of all investments. Domestically, the most active seed investors were Kakao Ventures with five deals, Future Play with four deals, and both Mirae Asset Venture Investment and Smilegate Investment with three deals each. However, global investor participation was a key feature of the largest deals. Prominent Silicon Valley firms such as Y Combinator, NFX, Bessemer Venture Partners, and Sierra Ventures have made bold early-stage investments, suggesting that South Korean AI and robotics startups are increasingly seen as global contenders.

Looking ahead, AI and robotics are expected to continue their dominance, driven by government policies promoting AI development. As market liquidity tightens, investors are becoming more selective, favouring startups that demonstrate clear market viability and specialised solutions, especially within vertical domains.

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