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[StartupRecipe] Korea’s Open Innovation Boom

#Weekly Funding Overview

[Mar.22 ~ Mar.27]

The total funds raised by Korean startups of this week is KRW 121.1 billion.

CompanyInudustryAmountRoundInvestors
MychefMealkit10 billionSeries B
CarmoreCar Rental10 billionSeries BGuardian Fund, Aion Asset Management, YG Investment,Bon Angels Venture Partners, TBT
Qrio Studio3D content-SeedKakao Ventures, Postech holdings
KinolightsOTT search platform-SeedKakao Ventures, Shinhan Capital
BigsomeFood100 millionSeedSeries ventures
PINOTBIOBio/Healthcare-ST Pharm
SHECO-SeedCCEI Gyeongnam, MYSC
CartaDrone2.5 billionSeries AStick Ventures, Aventures, Titan Ventures, SBA
NurihausEcommerce500 millionSeedHashed
WeltHealthcare6 billionSeries BHandoc, Smilegate Investment, Posco
Curome BioSciencesBio/Healthcare4 billionPre-Series AQuantum Ventures Korea, Hyundai Investment Partners,Devsisters Ventures, Laguna investment,
Space AddAdvertising3.3 billionSeries BArk Impact asset Management, Altos Ventures
Humaster2.2 billionSeries AArk Impact asset Management, Shinhan Alternative Investment Management
OncocrossBio/Healthcare-Daewoong Pharm
AprilBioBio/Healthcare10 billionYUHAN
KreamResell20 billionSeries ASoftbank Ventures, Altos Ventures
ICONIQUEFood-SeedMashup Angels, Strong Ventures
Beyond HoneyFood-SeedD2SF, Postech Holdings
Robo AreteRobot-SeedD2SF, Weventures
Lunar CircleBeauty-SeedSopoong Ventures
The CheckSoftware10.2 billionSeries A
Qraft TechnologiesFintech10 billionSeries C
Studio ShelterMedia/Content-RIDI
IhateflyingbugsEducation11 billionSeries BCoolidge Corner Investment

Major Funding

  • AI automated parking control system Parking Cloud has secured investment of KRW 25 billion. It is expanding its automated i-parking zone to more than 100 places every month in line with the contact-free trend.
  • Naver’s spin-off resell platform Kream raised KRW 20 billion in investment and accumulated KRW 40 billion in investment. Cream, which is gaining popularity among the MZ generation, is growing 121 percent on average every month. 
  • Camore recently raised KRW 10 billion in investment, which is a year and three months since their last round of investment. Camore is an O2O platform that compares the price of rental cars with 435 rental car companies in 56 regions across the country and holds 33,000 vehicles. 
  • MyChef, a meal-kit manufacturer, has succeeded in raising KRW 10 billion in investment at a KRW 50 billion valuation. With this investment, the company plans to increase productivity by introducing smart automation plants, join the K-food craze, and seek to expand overseas.

#Trend Analysis

Korea’s Open Innovation Boom

As the number of successful Korean startups increases, large companies that are interested in collaborating with them is increasing. In the past, the focus was on simple support, but now the atmosphere seems to have definitely changed as we can see in active collaboration. Until now, they have supported office space and initial investment after recruiting startups to help startups launch and advance their services, but now focus on actual collaboration by each subsidiary specialize in their support, by partnering with the startups that are aligned with their business.

Other examples of direct collaboration can be seen in cases of big companies disclosing tasks they want collaboration in and startups can offer solutions or business models for them. The government’s Big Star Solver program, which was launched last year, shares the same context. It is a government-led win-win program that has big companies that give problems to solve as assignments and startups solve them, which links up to 2.5 billion won worth of investment. In the first year, LG Display, Naver, and Baemin participated in this project, and based on last year’s performance, the government plans to further increase the size of the project this year.

There has been increase in strategic investment as well. Hyundai Marine & Fire Insurance announced that it will make strategic investments in Insure-tech company Bomap and start joint business development. Shinsegae launched a CVC last year and created a KRW 20 billion fund, while Lotte supports startups through providing connections and investments between Lotte affiliates and startups through their operation of Lotte Accelerator. Naver discovers early-stage tech companies through D2 Startup Factory and connects them with Naver, while making strategic investments in companies such as Balan and Brandy that are needed for expanding Naver’s territory.

South Korea’s six largest financial groups have been supporting startups early on since 2015 with the aim of discovering fintech firms. In the retail industry, Lotte, GS Home Shopping, Hite Jinro, Shinsegae, AmorePacific, and CJ are focusing on fostering startups. As vertical startups such as Market Curly and Musinsa started leading the market, the existing retail industry, which felt a sense of crisis, is looking for ways to preemptively discover, invest, and create synergy with their existing businesses.

Recently, the interest of leading conglomerates has expanded to ESG. As ESG is added to the existing startup support sector to carry out government grants focused on topics related to sustainability, such as energy and environment, opportunities are also opening up for relevant startups that did not receive much attention before.

Some critics say cooperation between startups and conglomerates cannot be seen as co-prosperity just because startups provide solutions that larger companies cannot. However, it is a good option for startups as it has the advantage of being able to expand their business in Korea or overseas through the abundant resources and network that large companies have, as well as financial support.

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