[StartupRecipe] The most notable Korean startup M&A deals of 2021

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#Weekly Funding Overview

[Dec. 3~ Dec.7]

The total funds raised by Korean startups of this week is KRW 281.5 billion.

Company	Industry	Amount	Round	Investors
Hidea	Game	20 billion		Neowiz
AIMMO	AI	12.6 billion	Series A	AIMMO DS Asset Management, Industrial bank of Korea, Hanwha Investment & Securities, S&S Investment, Toseu Investment, Korea Asset Investment & Securities, Venturefield
Nulleesoft	Tax Platform	4 billion	Series A	D3 Jubilee Partners, Smilegate Investment, Mirae Asset Venture Investment, KTB Network
TIME&CO	Media/Content	1.1 billion	Seed	Kakao Ventures
We are the	Fashion	900 million	Pre-Series A	Korea Investment
Reverse Lab	Shared bus	-	Seed	CNTTech
Planfit	Fitness	-	Seed	Spring Camp
Aicel	Data Service	-		Fiscal note
Dosigotgan	Food	-	Pre-Series A	Sopoong Ventures, Kingsley Ventures, Korea Credit Guarantee Fund, Samyangchemical
TalentBank	Talent Matching	6 billion	Series A	Avenue company, BNK Securities, Hanwhalife
ATOMOM Korea	Healthcare	-		New Paradigm Investment
Maas Asia	Shared mobility	-	Series A	Lotte Ventures, Daedeok Venture Partners, Main Street Investment
Kristin Company	Fashion	-	GRANT	TIPS
VIRNECT	XR	30 billion	Series B	Stic Ventures, Lotte Ventures, Hanwha, KTB Network, KB Investment, Korea Develpoment Bank
Dver	digital mail room	2 billion	Series A	SJ Investment Partners, Capstone Partners, LG Uplus
Dealicious	Food	54 billion	Series C	Stonebridge Ventures, Stonebridge Ventures, DSC Investment, Yuanta Investment, Smilegate Investment
Bemyfriends	Fan commerce	8 billion		Saehan Venture Capital, GS, Dreamuscomapny
2HAELIFESTYLE	furniture rental	3 billion	Series A	SmartstudyVentures, SUN&L, Hyundai Marine & Fire Insurance Co, Bluepointpartners, Seoul Business Agency
Curocell	Bio/Healthcare	36 billion	Pre-IPO
Selvers	onmichannel Platform	-	Seed	CNTTech
Egg Corporation	Digital Healthcare	-	Seed	CCEI gangwon
Lighten Technologies	h	-	Seed	CCEI gangwon
Lighten Technologies	Healthcare	-	Seed	CCEI gangwon
NBNB	housing rental	-	Seed	CCEI Incheon
Heodak	Food	-	M&A	Fresheasy
Line system	Logistics	-	M&A	Fresheasy
Standard Energy	Vanadium Ion Battery	65 billion		Lotte Chemical
Funble	Fintech	5 billion		Woori Technology Investment, SK Securities, Maple Investment Partners, Hanwha Hotels & Resorts, The Square& Company
Fridayslab	Business tool	-	Seed	Kakao Ventures
Omniart	Art commerce	-	Seed	HITEJINRO
Unitcompany	All in one production	-	Seed	Strong Ventures
ecg	Mobility	-		CNTTech, Hankooktire
SmartInside AI	Safety solution	-		Honest Ventures
Ninenjoy	Game	-	Pre-Series A	pocket company
SAFESPEC	kids community	-	Seed	Ideapartners
Dadaex	Delivery	-	Seed	KOVA
NBNB	housing rental	-	Seed	KOVA
SpringCloud	Mobility	18 billion	Series A	InfoBank Corp, Mando, Korea Develpoment Bank, Woodreambio, Korea Credit Guarantee Fund
Iconchina	Marketing	10.4 billion		Angels
DeepLeHR	HR	-	Seed	Bluepointpartners
GPEX	Blockchain	1.8 billion		Sima Capital
Cinnamon company	Kids Content	100 million	Seed	Startupx
Remedy	Pettech	-	Seed	CNTTech
Haenyeokitchen	Food	-	Seed	CNTTech
HIPPO T&C	Digital therapeutics	300 million	Pre-Series A	J Curve Investment, StarQuest Asset Management, Insunginfo

Major Funding

• Standard Energy, a vanadium-ion battery developer, raised 65 billion won from Lotte Chemical. With lower ignition hazards and higher durability than lithium-ion batteries, vanadium-ion batteries are regarded as the next-generation batteries in the ESS market. Lotte Chemical became Standard Energy’s second-largest stakeholder as a result of this investment. They hope to achieve synergy through collaboration.
• Dealicious, which operates the fashion retail and wholesale trading platform ShinSang Market, raised 54 billion won. It launched the service in 2013, and as of December, the total value of transactions had surpassed 2 trillion won. It will work in full swing for global expansion based on the successful experience of the digital transformation of K-fashion.
• XR developer Virnect secured a 30 billion won investment. It will use the funds to establish an industrial XR ecosystem and to promote itself to advance into global markets. As a leading company in the metaverse market, it is set to go public this year.

#Trend Analysis

The most notable Korean startup M&A deals of 2021

2021 was the most active year ever for the startup M&A market. It was a year of opportunity for startups and investment companies, with startups acquiring startups, startups acquiring middle-market enterprises, and startups being acquired by global companies. 

The largest acquisition of this year was the takeover of Hyperconnect by Tinder operator Match Group at $1.72 billion(1.93 trillion won). Following Baedal Minjok, it was another case demonstrating that Korean technology startups can be sold to global companies.

Large companies are actively utilizing startups to expand their business areas and strengthen their competitiveness. To preoccupy the online and offline distribution market, GS Retail purchased Delivery Hero, a delivery app Yogiyo operator, along with private equity funds. Lotte hopes to make a breakthrough in its lagging e-commerce business by acquiring Junggonara.

Kakao bought Tapas Media and Radish, two web novel and webtoon platforms with a global presence, to speed up its entry into the global market. Kakao also bought Croquis, a Zigzag operator, and Grip Company, a live commerce platform to expand its e-commerce business area.

In 2021, the number of acquisitions between startups increased significantly, with unicorns absorbing other startups in particular. Musinsa enhanced its competitiveness in the women’s fashion sector by acquiring StyleShare and 29CM for KRW 300 billion. Startups also took over industry leaders, with Yanolja acquiring a first-generation venture company Interpart for 290 billion won. Yanolja is also accelerating its growth ahead of its IPO by acquiring Sanha IT and Dable. Moreover, Toss operator Viva Republica absorbed VCNC, which was in charge of operating Socar’s Tada division, signaling the birth of a new model that combines finance and mobility. 

In addition, meal kit company Fresheasy acquired related companies, including Heodak and Dr. Kitchen, which helps health care like diabetes management. Bunjang also aims to become a unicorn through business expansion by acquiring two used clothes companies.

The reason for the increase in M&A cases is that, in order to respond to rapidly changing market trends, companies adopt a strategy of absorbing external companies that stand out in the market instead of directly conducting new businesses. It wouldn’t have been possible without the abundant financial resources. In the past, most M&A cases took place between companies in the same industry, but now more and more companies are seeking synergy by acquiring companies in other fields. Amid this trend, VCs predict that the number of cases between startups or startups acquiring existing companies will continue to rise in 2022.

Major M&A Deals in 2021

Company Name	Company Description	Acquisition Cost	Acquiring Company
Hyperconnect	Video Messenger	1.93 trillion won	Match Group
Delivery Hero	Delivery Platform	800 billion won	GS Retail, Affinity Equity Partners, Permira
Tapas Media	Webtoon&Web Novel Platform	600 billion won	Kakao Entertainment
Radish	Web Novel Platform	500 billion won	Kakao Entertainment
StyleShare	Fashion Platform	300 billion won	Musinsa
Interpark	E-commerce	294 billion won	Yanolja
Junggonara	Secondhand Marketplace	115 billion won	Lotte, Eugene Asset Management, NH Securities-Opus Private Equity
Croquis	Fashion Platform	Non-disclosure	Kakao
Munpia	Web Novel Platform	Non-disclosure	Naver Webtoon, Premier Partners
Millie’s Library	Audiobook	Non-disclosure	Genie Music
VCNC	Socar’s Tada division	Non-disclosure	Viva Republica
Dr. Kitchen	Healthcare Platform	Non-disclosure	Fresheasy