[StartupRecipe] Who Will Be S. Korea’s Future Unicorns?

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

#Weekly Funding Overview

[June.24~ June.28]

The total funds raised by Korean startups of the week is KRW 88.84 Billion.

Company	Inudustry	Amount	Round	Investors
Paywatch	Fintech	20 billion	Series A	Third Prime, Vanderbilt, University of Illinois Foundation, Octagon Venture Partners, wooshin Venture Investments
STUDIO LAB	Commerce content	-	Grant	Deeptech TIPS
RNR LAB	Manufacturing	2.84 billion		KCLAVIS Asset Management, KODIT
MarinaChain	Logistics	-		Cnttech
TMR Founders	Table order Service	-		Hite Jinro
Medithings	Healthcare	-	Series A	Intervest, DT&Investment, Huonsmeditech
Pi Corporation	New media	4 billion	Series A	Altos Ventures
HYPHEN	Data solution	-	Grant	TIPS
Endo Health	Healthcare	-	Pre-Seed	Anne Wojcicki, a16z
Gemgem therapeutics	Game	500 million	Seed	Korea Investment Accelerator, Digital Healthcare Partners
Findaauto	Car Rental	2.1 billion	Pre-Series A	Future Play, BNK Capital
Tayler town	Men's fashion	5.4 billion	Series A	Goodwater Capital
Welt	Digital therapeutics	14 billion	Series C	Envisioning Partners, Korea Development Bank, IMM Investment, Shinhan Venture Investment, Handok
Nexusbe	Bio	10 billion	Series B	L&S Venture Capital, Smilegate Investments, Enlight Ventures, Stick Ventures, Coolidge Corner Investments, KODIT, Vine Ventures
Doers	Influencer platform	-	Pre-Series A	Korea Investment Partners, Bass Investment
Placycl	Recycling	-	Seed	Blue Point Partners, Gradiant
Vielt	Healthcare	-	Grant	TIPS
Carbonsaurus	Carbon tracking platform	-	Pre-Series A	Grand Ventures, Primer Sazze partners
Xpanner	Contech	15 billion	Series B	Korea Investment Partners, KB Investment, Partners Investment
78ResearchLab	Security	-	Pre-Series A	V Platform Investments, Kingsley Ventures
Mass Adoption	Brand membership solution	-	Grant	TIPS
Romansive	Sleeptech	800 million	Pre-Series A	Cnttech, EAST GATE PARTNERS
Sweep	Shopping solution	1 billion	Seed	Bass Investment, Spring Camp
Break company	Trading card	-	Pre-Series A	GS Ventures, Sema Investment
KEVIT	electronic car charging	-	Grant	Post Tips
Snapcompany	Commerce solution	-	Grant	Scale
iqoocca	Kids fintech	-	Grant	TIPS
Meal zip	F&B	-		Impact partners
Korea housing information	Housing management SaaS	2.2 billion	Pre-Series A	KOC Partners, Aqara life
Simsys global	Digital twin	3 billion	Series A	Hana Securities, I TRUST
Nangmanshop	F&B	-	Pre-Series A	Dasung Ventures, KODIT
Kokanlogis	Logistics platform	-	Seed	500global
JIGO AI	Contract solution	-		The Ventures
Inbic	AI Vision	-	Grant	TIPS

#Major Funding

• Fintech startup Paywatch has secured a 20 billion KRW investment. The company provides a service that allows employees to receive part of their salary in advance, offering up to 50% of their paycheck without interest.
• Robotics-based construction automation solution company XPanner has secured a 15 billion KRW investment. The company generates over 70% of its revenue from the U.S., targeting global construction firms. This year, they plan to commercialize an automation solution specialized for solar power plant construction sites.
• Digital therapeutic device company Welt has secured a 14 billion KRW investment, bringing their total accumulated investment to 28 billion KRW. In April of last year, they began prescribing ‘SLEEP-Q,’ a digital therapeutic for insomnia that received approval from the Ministry of Food and Drug Safety.

#Trend Analysis

Who Will Be S. Korea’s Future Unicorns?

South Korea’s government has identified 15 pre-unicorn companies poised for potential global unicorn status in 2024, marking a significant milestone in its ongoing effort to bolster the nation’s startup ecosystem. This latest selection brings the total number of companies chosen since the program’s inception in 2019 to 111, underscoring the government’s commitment to fostering innovation and growth in the private sector.

The initiative targets privately held firms that have demonstrated exceptional investment performance, with thresholds set at 5 billion won for global prospects and 3 billion won for local star companies. Additionally, these companies must boast an enterprise value exceeding 100 billion won to qualify for the program, which aims to provide crucial growth funding to facilitate their ascension to unicorn status.

Recent selections reflect a notable shift in the startup landscape, with B2B solution providers now dominating the pre-unicorn list. This trend marks a departure from the pre-2021 era when B2C platforms were predominantly favored. The manufacturing and healthcare/biotech sectors have gained significant traction, while food tech is emerging as a formidable contender in the consumer technology space. Conversely, the edtech and fintech sectors have experienced a relative decline in representation.

The global economic downturn has cast a shadow over unicorn creation, with no new unicorns reported in 2024 to date. The previous year saw only three companies – Padu, KREAM, and APR – achieve unicorn status. Despite these challenges, the government remains steadfast in its commitment to identifying and nurturing potential unicorns to drive growth in the startup ecosystem.

Several success stories have emerged from the pre-unicorn selections. Companies such as RIDI, Kurly, Padu, Korea Credit Data, Tridge, and Jibang have successfully attained unicorn status. Others, including Jeju Beer, Neuromeca, and OneDrab, have made their debut on public markets. Firms like Smartstudy, MyRealTrip, and StyleShare (acquired by Mushinsa) have established themselves as sector leaders, while BalanceHero, Channel Corporation, and GoPizza are gaining international recognition.

In the burgeoning semiconductor market, Ochestro and Semifive are expanding their operations. Ably Corp. is on the cusp of unicorn status following a recent 67 million won investment that values the company at 900 million won. Meanwhile, Livesmed is preparing for an IPO with an estimated valuation of 800 billion won.

However, the path to success is not without its challenges. Most of the program’s success stories stem from pre-2021 selections, particularly those from 2019, a period that coincided with increased liquidity in the startup market. Companies selected after 2021 have shown more modest growth, reflecting the impact of economic uncertainties and a tightening investment landscape.

Some companies face significant hurdles, including Curly’s delayed IPO, Ruiiid’s management changes, Mesh Korea’s merger, and continued losses for zikbang and Whatcha. The declining valuations of existing unicorns further indicate that the market has yet to fully recover.

Despite these obstacles, there are encouraging signs for the startup ecosystem. The average revenue, employee count, and investment amounts for pre-unicorns continue to rise year over year. Startups are demonstrating resilience by adapting to the changing market environment, focusing on management innovation and performance improvement.

Particularly noteworthy is the global expansion of promising domestic startups, especially in the semiconductor sector. These companies are attracting investments from international firms, signaling recognition of their technology and business models on the world stage.

As market conditions improve, industry observers anticipate the emergence of globally competitive companies, fueled by continued government support and the persistent efforts of the startups themselves. The Korean startup scene, while facing challenges, continues to evolve and adapt, positioning itself for future growth and innovation on the global stage.

15 selected startups(2024) =Grinergy, Nature Mobility, Dot, The Black Label, Rapport Labs, BiOrchestra, SuperMakers, Slash B slash, FRD, YEOLMAE COMPANY,  Autonomous a2z, Egnis, 1ST Biotherapeutics, OrganoidScience, HyriumIndustries