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[StartupRecipe] This Year’s Lack of Unicorns

#Weekly Funding Overview

[Nov. 2~ Nov. 6]

This week, 14 companies ranging from healthcare to blockchain reported investments. 

Learners MindEducation-company B
Ulala LABSoftware3.5 billionSeries AKINGO Investment Partners, HYUNDAI VENTURE INVESTMENT, Hanwha Investment & Securities
bereviewConsumer500 millionSeedDSC Investment, SCHMIDT
PickplesConsumer100 millionSeedAngels
NeuroSenseManufacture600 millionPre-Series AJINYOUNG ELECTRO/MECHANICS
GuideLiveConsumer-SeedMy real trip
Spring OnwardConsumer650 millionSeedYanolja, Ascendo Ventures, Angel matching fund, Yplanets
MoMo ProjectConsumer-Seed500startups
iircadeGame6.16 billionGAUSS CAPITAL MANAGEMENT, Mirae Asset Venture Investment
DiscoReal estate/Proptech5 billionSeries BSEMA Translink Investment, Halla holdings, DONGHOON Investment
AngabongilConsumer-Pre-Series Alaguna investment
H RoboticsBIo/Healthcare6 billionSeries AWe Ventures, SCHMIDT, CKD Venture Capital, POSCO CAPITAL, Hyundai Investment Partners, BNK VENTURE CAPITAL, L&S Venture Capital

Major funding

  • H-ROBOTICS, which develops control technology and motor algorithms to be used in rehabilitation robots (rebless), will attract KRW 6 billion worth of series A investments and plans to launch new products within the year. 
  • Real estate information platform Disco attracted KRW 5 billion and announced a plan to become the first online regional real-estate transaction platform in Korea.   
  • UlalaLAB, a cloud-based smart factory company for manufacturing SMEs, attracted KRW 3.5 billion worth of series A investments. In addition, home arcade game company iiRcade attracted USD 5.5 million (KRW 6.1 billion) in its first institutional investment and is set to take the lead in the entertainment market, which has been growing during COVID-19. 

More funding

Companies that attracted seed investment are as follows. Smart IOT sensor company NeuroSense attracted KRW 600 million; coffee subscription service One Do Daily provider Springonward KRW 650 million; Pickples, operater of Chinese medicine platform Allhan, KRW 100 million; and review curiation provider Bereview, KRW 500 million. 

Undisclosed Funding

  • Mewpot=an image sourcing platform for creators
  • Angabongil=operator of interior reverse auction platform Housefit
  • GuideLive= a guide-centered travel platform where guides can develop and manage travel plans
  • Momo Project= a tailored health management platform for companion animals
  • Learners Mind= a rote education service class card for teachers
  • XPeare=a blockchain-based IP platform. 

#Trend Analysis

This Year’s Lack of Unicorns 

In October, Socar attracted KRW 60 billion and was recognized as a unicorn company worth more than KRW 1 trillion. 

According to a study done by the Ministry of SMEs and Startups based on foreign media, as of October, South Korea has 13 unicorn companies, including Coupang, Krafton, Yellow Mobile, Viva Republica, Wemakeprice, Musinsa, Zippy Club, L&P Cosmetics, Aprogen, Yanolja, Timon, Socar, and one company that refused to disclose its name. 

Last year alone, Woowa brothers (excluded this year due to Deliver Hero M&A), Viva Republica, Musinsa, Yanolja, and Wemakeprice were recognized as unicorn companies. 

Many promising startups have been suggested to become unicorns, such as Zigbang and Market Curly, and expectations have been high that more unicorns will emerge in 2020. 

However, Socar is the only startup that officially became a unicorn through the media, not as a listed company. Viva Republica, Market Curly, and Stunitas are the only startups that attracted more than KRW 100 billion due to the struggling investment market hit by COVID-19.  

Even though the largest FOF ever has was created in order to revitalize the startup environment, as conservative investment trends continue amid the COVID-19 crisis, it remains uncertain whether additional companies can join the ranks of unicorns this year. Various government support policies are being implemented to foster more unicorns. 

The representative projects include Preliminary Unicorn Special Assurance, Innovation Icons, and the Baby Unicorn Incubation Project. 

Last year, the Korean government announced its ambition to increase the number of unicorn companies to 20 by investing KRW 12 trillion by 2022. 

While domestic companies in certain sectors, such as commerce and retail, have joined the ranks of unicorns in the past, overseas companies in the field of corporate productivity, such as fintech and healthcare, which have benefited from COVID-19, became unicorns this year. 

South Korea also needs to focus on creating an environment to foster sound enterprises in diverse sectors rather than just focusing on the number of unicorn companies. 

#More news

  • According to the Start-up Trend Report 2020, conducted by Startup Alliance and Open Survey, this year, the startup environment has been glum due to Covid-19. This has resulted in a fewer new hires, transfers, and more difficulties in starting businesses. However, in accordance with the belief that the startup environment is maturing every year, there is a strong perception that the environment will improve next year. Despite a decrease in investment in the first half of the year due to COVID-19, since most VCs completed their funding this year, investments are expected to be normalized in the future. 
  • The ‘2020 Startup Korea!’ report has been published. It presents directions for improvement of domestic startups through analysis of the policy environment. The report selected online platforms, fintech, remote medicine, and AI to analyze the domestic situation and issues in these sectors. It explains that South Korea needs to ease regulations and policies that hinder growth in order to achieve remarkable growth  
  • Smart Study, which produces Pinkfong content, announced that the rumor about its listing on NASDAQ is groundless. Smart Study has not made a decision about IPO nor had any discussions about IPO. However, the company will focus on growth first and consider IPO in the future. 

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