[StartupRecipe] Investor Interest in Fashion Startups Remains High

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#Weekly Funding Overview

[Mar. 20 ~ Mar. 24]

The total funds raised by Korean startups of this week is KRW 125.3 billion.

Company	Inudustry	Amount	Round	Investors
Tresure labs	NFT Metaverse	-		Solana
Widgetnuri	software	-	Grant	TIPS
Dr.oregonin	Healthcare	-	Grant	TIPS
Ride	Mobility	-	Pre-Series A
SIG	Energy	3.5 billion	Pre-IPO	Pyco & company, MW & Company
Denve		300 million	Seed	ImpactSquare
Tripus	Travel	-	Seed	Korea Investment Accelerator
Ably Corporation	Fashion	50 billion	Series C	Pine Tree Investment & Management
Medithings	Healthcare	-	Seed Bridge	Kakao Ventures, Dcamp
Urban Labs	altprotein	-	Seed	Bigbang Angels, Korea Omega Investment
PeLeMed	Bio	5.5 billion	Series A bridge	LSK Investment, KDB Capital, Bokwang Investment, BSK Investment, Alpha One Investment
Crocus		6.4 billion	Series B	E&Investment, Pioneer Investment, Shinhan Asset Management, S&S Investment
Deeplant	Food	-	Grant	TIPS
Rentre	IT Rental	-	Grant	TIPS
Nextstory	Leisure	-	M&A	onoffmix
SMfab	Manufacture	-	Grant	TIPS
Aroundfollie	outdoor stay	-	M&A	Stayfolio
Kream	Resell	50.6 billion	Series C	Samsung Securities, Mirae Asset Capital, Altos Ventures, ExomAsia
Neubility	Robotics	3 billion		Samsung Venture Investment
Fitpet	Pettech	5 billion		Dongwha
Dogather	Real estate	1 billion	Seed	Seoul Techno Holdings, KAIST Venture Investment
Earlysloth	AI CRM Platform	-	Pre-Series A	Hana Financial Investment, K&Investment Partners
Deepsales	Trade Platform	-	Seed	Yoonmin Foundation, Blue Point Partners, Kingsley Ventures
Greenlabs	Agriculture	50 billion		BRV Capital Manager, Sky Lake

Major Funding

• Kream, a resell platform, has secured an additional KRW 50.6 billion to complete its Series C funding of KRW 206 billion, reaching a unicorn valuation of KRW 970-980 billion. The company is focusing on building a commerce ecosystem across major Asian regions including Japan, Singapore, Thailand, and Indonesia through its M&A strategy. The investment will be utilized to expedite the company’s global expansion plans.
• Ably Corp. has secured KRW 50 billion in venture debt, bringing its cumulative investment to KRW 223 billion, which is the highest in the women’s shopping industry within the Korean startup ecosystem. The company has become one of the top 1 fashion platforms, with monthly transactions of over KRW 100 billion and annual transactions of KRW 1 trillion, within just four years of its launch. Ably Corp. is on the verge of breaking even and aims to achieve unicorn status within the year.
• FitPet, a startup specializing in pet healthcare solutions, has secured a strategic investment of KRW 5 billion from Donghwa Pharmaceutical. The investment will be used to further develop FitPet’s innovative pet healthcare database, which Donghwa Pharmaceutical plans to utilize for animal medicine research and development. The partnership between the two companies is expected to be highly cooperative, with a shared goal of advancing the health and wellbeing of pets.

#Trend Analysis

Investor Interest in Fashion Startups Remains High

The startup landscape in 2023 is expected to be more challenging due to the uncertain domestic and global financial markets. According to the monthly investment report from Startuprecipe, funding in January plummeted by 80% compared to the same period last year. In February, total investment fell short of KRW 200 billion and March is expected to follow a similar trend with total investment remaining in the low KRW 200 billion range. However, the fashion and beauty sectors are still attracting large-scale investment. Specifically, platforms that distribute luxury goods and limited-edition products in the fashion and beauty industries have garnered particular attention.

Several related companies have announced significant investments in recent times. For instance, resell platform Cream secured KRW227 billion in a Series C funding round with an additional KRW50.6 billion. This brings the company’s valuation to KRW 980 billion, and it could potentially attain unicorn status. Fashion commerce company Ably Corporation also secured KRW50 billion through venture debt and expects to become profitable within the year. APR, a beauty/fashion brand, raised KRW 8 billion in pre-IPO investment and is set to go public. Similarly, Guhada, a luxury platform, secured KRW8 billion, confirming that luxury platforms remain a popular sector. These companies’ ability to attract investment is due to their clear evidence of future growth potential, such as global expansion and profitability. With few companies securing Series C or later rounds this year, the funding they’ve secured will help them avoid ending the first quarter on a low note.

Investors are showing interest in early-stage fashion startups as well. Mineis, a platform that sells second-hand clothing, secured KRW41.5 billion at the seed stage alone, demonstrating the popularity of second-hand fashion platforms. Moreover, early-stage fashion startups offering eco-friendly solutions or technology-based services are becoming strategic investment targets for large companies. The number of beauty/fashion influencers starting up has also increased in recent years. Vertical services that focus on specific areas such as age and gender are gaining popularity too.

Despite the relatively large amounts of funding that fashion platforms are attracting, they’re also experiencing the fallout from the investment bubble of the past few years. This includes inflated valuations, mismanagement, employee layoffs, and missing leadership. With the current financial market uncertainty and economic downturn, startups need to be more cautious in their funding plans and management strategies. To attract investment successfully, they must demonstrate their potential for sustained growth.