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[StartupRecipe] How do Gov-backed high-growth K-startups perform?

#Weekly Funding Overview

[May. 13~ May. 17]

The total funds raised by Korean startups of the week is KRW 54.2 Billion.

PetbomPet Sitter app-SeedThe Invention Lab
LivexBeauty tech6 billionSeries AMain Street Investment, Series Ventures, Smart Study Ventures, BNK SECURITIES
DeliverylabFood tech-Woori Bank, Magellan Technology Investment
Phyto researchSmart farm-SeedJeonbuk CCEI, MYSC
DispectorRobotics400 millionPre-Series AThe Invention Lab
Futuregate800 millionPre-Series AThe Invention Lab
Horangedu-SeedYoonmin foundation
December & CompanyRobo Advisor17 billionForest Partners
AlpesBattery2 billionAnsan city
DeepsalesSales intelligence2 billionPre-Series AYes24, Woori Technology Investment, JL Partners
MedInTechHealthcare20 billionSeries BAtinum Investment, Future Play, Smilegate Investment, Nextrans, IBK Industrial Bank, SL Investment, Hana Ventures, Wooshin Venture Investment, Samchully Investment
MetisXCXL Solution6 billionSeries ASV Investment, STIC Ventures, LB Investment, IBK Industrial Bank, Mirae Asset Venture Investment, Mirae Asset Capital, IMM Investment, SBI Investment, Tony Investment, Wonik Investment Partners

#Major Funding

  • Meditech, a startup developing smart endoscopes for medical use, has secured KRW 2 billion in investment. The company has developed an electric endoscope that is 50% lighter and more convenient than conventional endoscopes. Meditech plans to enter the market in full force by the end of the year.
  • December Company, the operator of roboadvisor Fint, has secured KRW 1.7 billion in investment. Fint is a service that uses AI to automatically invest in global stocks, bonds, and exchange-traded funds (ETFs). The company plans to use the investment to further develop its service and technology.
  • LiveX, a beautytech company, has secured KWR 6 billion in investment. LiveX started as a beauty salon and now offers a total beauty service that integrates online and offline channels.

#Trend Analysis

How do government-backed high-growth K-startups perform?

A wave of economic uncertainty, both domestically and abroad, is causing a chill in the investment landscape for Korean startups. This has led to a decline in company valuations and a dearth of new unicorns – private companies valued at over $1 billion.

So far this year, South Korea hasn’t minted a single new unicorn, highlighting the need for robust government support to help promising startups weather the storm.

One such initiative is the KODIT’s Innovation Icon program. This program provides crucial support to high-growth startups with the potential to become future unicorns. Through its scale-up program, Innovation Icon offers guarantees of up to 20 billion won for three years, helping startups secure funding. So far, 53 promising startups have been selected for the program.

While none of the selected startups have yet achieved unicorn status, many have shown strong investment performance, particularly in sectors like AI semiconductors and generative AI. Companies like Rebellion and Upstage stand out for their innovative technologies and are considered strong contenders for future unicorn status.

An interesting trend is the changing landscape of chosen companies. Prior to Batch 7, B2C platform companies like BucketPlace (onul House), Lifegoeson(Lundarygo), Brandy, and Class101 were selected, with Bucket Place even achieving unicorn status. However, from Batch 9 onwards, the focus has shifted towards B2B technology companies, with B2C platforms seemingly absent from the selections.

Despite the challenging economic climate, Innovation Icon companies have proven adept at attracting investment, demonstrating their growth potential. Collectively, these 53 companies have secured a staggering 2.535 trillion won in follow-on investment.

While investment performance alone doesn’t guarantee a company’s rise to unicorn status, it is a positive indicator. Many of these startups are actively pursuing growth strategies, including expanding into global markets and solidifying their positions within the domestic market.

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