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[StartupRecipe] Salary Skyrocketing for Korean IT Developers

#Weekly Funding Overview

[Mar.1 ~ Mar.5]

The total funds raised by Korean startups of this week is KRW 76.1 billion.

December&CompanyFintech9.9 billionBC card
LawfullyLegal tech2 billionPre-Series AHB Investment, TBT
LogislabLogistics2.5 billionSK ENERGY
40FYMental healthcare500 millionSeedKlim Ventures
Uniquegood CompanyGame1.2 billionSeries AThe wells investment
ReharvestFoodupcicle-EUGENE INVESTMENT, MYSC
Celeb CommerceEcommerce-Pre-Series AHisstory Venture, Korea Credit Guarantee Fund
BLQEcommerce-SeedSopoong Ventures
The realgroupFashion-SeedStrong Ventures
TransverseEducation-SeedSeoul Techno Holdings
GuhadaBlockchain4.5 billionKorea Investment Partners, Korea growth investment, POSCO CAPITAL, GS Homeshopping
Bebridgeproductive tool-SeedD.CAMP, Mashup Angels
NOVELTY NOBILITYBio/Healthcare8 billionSeries A bridge
StandigmBio/Healthcare41 billionPre-IPOSKS PE, Daeshin PE, Intervest, KDB Bank, Kakao Ventures, LB Investment, Atinum ventures, DSC Investment, Wonik Investment Partners, Asset One
GibggumigiInterior6.5 billionAtinum Investment, Premire Partners, Breeze Investment, Woomi global

Major Funding

  • December & Company Asset Management, which operates AI led investment ‘Fint’, has raised KRW 9.9 billion. The company has developed the RoboAdvisor management platform ‘PREFACE’ and artificial intelligence asset distribution engine ‘ISAAC’ for about six years and owns the original technology. Fint, their flagship service, has accumulated more than 400,000 members in less than two years after its launch.
  • Interior and Living Platform, Gibggumigi raised KRW 6.5 billion in investment. They have accumulated KRW 15.5 billion in investment. The company has been aiming to be a one-stop interior platform since its launch in 2014, and has reached 3.1 million members as of the end of February.

More Funding

  • GUHADA, a blockchain technology based luxury shopping mall, has raised KRW 4.5 billion in investment. GUHADA is a service that allows consumers to transparently check information such as certificates and distribution history through blockchain and trade products based on the information provided.
  • AI-based online legal platform Lawfully raised KRW 2 billion. Founded in 2017, Lawfully makes the immigration process comfortable and accessible by providing users with a personal legal assistant.

Undisclosed funding

  • BeBridge, which runs a video capture note called Slide raised seed investment from D.Camp and Mashup Angels.
  • Celeb Commerce, an e-commerce platform that sells products by matching brands, celebrities, and influencer, raised investment in Pre-Series A.
  • The Real Group, which operates the luxury fashion search engine platform called Really, raised seed investment from Strong Ventures.

#Trend Analysis

Salary Skyrocketing for Korean IT Developers

The annual salary of Korean IT developers is going through the roof. As industries such as IT and gaming have grown rapidly, companies are eager to secure IT talent. Recently, large companies feel a sense of crisis in IT talent outflow due to the news that executives of Samsung Electronics’ wireless business division have went over to Coupang. It was 50% salary raise and other benefits such as stock options that led them to move. On top of that, there is a sense of crisis among companies that non-IT companies such as finance and entertainment can be deprived of competent developers as they hire a large number of developers in line with their digital transformation.  

Raising the salary of developers began in the game industry. Battleground developer Krafton announced that it would raise the annual salary of all developers by KRW 20 million, while Nexon and Netmarble also raised the starting salary of developers to KRW 50 million.

Startup companies are also trying to secure IT talent. Since a few years ago, Coupang, Baemin, and Viva Republica (Toss) have attracted large investments and poured them into securing talent, sparking a wage hike across the startup scene. They also offered unconventional benefits such as stock options and KRW 100 million in signing bonuses. In Korea, many combine IT companies considered good companies to work that are not big conglomerates and call them “Nekarakubae” (Naver, Kakao, Line, Coupang, and Baemin), and are now preferred because they have a more free atmosphere than conglomerates and better working conditions. 

Recently, Jikbang, a real estate information platform that is set to be in the unicorn ranks, also announced that it will raise the annual salary of developers by KRW 20 million and guarantee the starting salary of new developers by KRW 60 million. Startups are moving their offices to the Gangnam area or even are opening spaces just for developers to create a good working environment as well as compensating well to attract talent.

Due to this atmosphere, the coding boom is also in full swing in Korea. People that did not major in programming are learning to code and are trying to switch careers for better treatment. Online students are increasing as pre-education post-payment concept coding education platform has also appeared in Korea that are benchmarking coding school models overseas. 

In addition, startups such as Baemin are using strategies to find competent developers early by creating their own developer education programs.

The boom in recruiting developers is actually a result of Korea’s lack of developer talent pool. There are many new developers who are not capable enough to start working immediately and few developers that are competent. Because of this situations, many are saying universities should establish an IT talent training system. The industry expects that developers’ salary will continue to rise in the future as more Internet companies demand developers in the future.

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