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[StartupRecipe] Metaverse Investments Plunge 70% in Korea

#Weekly Funding Overview

[June. 26~ June. 30]

The total funds raised by Korean startups of this week is KRW 48.85 billion.

Team ElsiumDigital Healthcare-Pre-Series AStrong Ventures, Digital Healthcare Partners
BindMan Fashion commerce-Pre-Series AFast Ventures, D-Camp, Npartners
DalphaAI1.3 billionSeedPrimersazze Partners, Dunamu & Partners, Spring Camp
LearningspoonsHR Tech-Series A1Kiwoom Investment, Wanted Lab
AGUNIAgriculture-Pre-Series AInfobank
Solarnetwork systemGreen energy-Groundup ventures
SankunContech-Pre-Series AStrong Ventures, IBK Industrial Bank of Korea, KODIT
ClopHealthcare-SeedFuture Play, Shinhan Capital
NextorMetaverse4.15 billionSeedISTN
XORBISContent11.5 billionGLOBAL TAX FREE, Finger Story
UNBOXERSGlobal social service1.4 billionSeedBass Investment, Mirae Asset Venture Investment, Goodwater Capital
Bos semiMobility2 billionHyundai motor group
Qunova Computingquantum computing5 billionHyundai Motor, Laguna Investment, Blue Point Partners, Smilegate Investment, ID Ventures, KB Investment, Daesung Private Equity
Pierrot Company1 billionPre-Series APrimer Sazze Partners
BiomatzBio2 billionSeedKorea Investment Partners, Gyeongnam Venture Investment, Kolmar Korea Holdings, Daewoong Pharmaceutical
Team BlackbirdBlockchain8.5 billionSeries AAtinum Investment, IMM Investment, SK, Bass Investment, Hillspring Investment
DeepleHRHR-Pre-Series AKB Investment, Inlight Ventures, D-Camp, Wanted Lab
ItgreenFood delivery-Pre-Series ASGC Partners, Ajou IB Investment, Lotte Ventures, KODIT
AllmtourTravel platform700 millionPre-Series AKODIT
Contoro RoboticsRobotics6.1 billionSeedSV Investment, Kakao Ventures, Bass Investment, Futureplay, UT Austin Seed Fund
Plating CorpFood3.2 billionSeries A1Strong Ventures, Philosopia Ventures, Tail, Korea Alternative Investment Corporation
Retail LagoonK Beauty-SeedKorea Investment Accelerator
MolocoMachine learning-EDBI, Fidelity Management & Research Company

Major Funding

  • Exobis, a company specializing in immersive content, has attracted a KRW 11.5 billion investment. With the investment, they plan to expand their immersive content business and develop immersive content for exhibitions, museums, and other projects. They also have plans to fully launch the MusemX project in Sokcho, which incorporates immersive media technology.
  • Team Blackbird, the developer of the on-chain data analysis platform Cryptoquant, has attracted KRW 8.5 billion in investment, securing a total funding of KRW 12 billion. They have launched Cryptoquant, utilizing their identification technology for cryptocurrency wallet identification. Through the data cited by Bloomberg, Forbes, and other sources, they have discovered abnormal signs preceding incidents such as the Luna Incident and FTX Incident.
  • ConToro Robotics, a robot startup, has attracted KRW 6.1 billion (4.7 million dollars) in investment. They focus on solving container handling issues in warehouses in the United States, and this investment will accelerate the commercialization of their augmented intelligence technology.

#Trend Analysis

Metaverse Investments Plunge 70% in Korea

The metaverse, once a dominant force in the big tech market, is experiencing a decline in popularity. While the metaverse witnessed a meteoric rise during the COVID-19 pandemic, fueled by the widespread adoption of virtual reality technology across various sectors, recent setbacks in the investment landscape have resulted in a waning interest in metaverse services that have yet to prove their profitability.

According to data from startup recipe investments, Korean metaverse startups have seen a staggering 70% decrease in the funds raised from 2022 to the first half of this year. The pandemic-induced surge in metaverse services had attracted substantial investments, particularly from successful companies that secured significant funding last year. Virtual events supplanted their offline counterparts, while various domains such as virtual concerts and tools for content creation in the metaverse garnered significant attention. Capitalizing on this trend, major corporations engaged in cutthroat competition, investing in metaverse platforms and content startups to forge strategic partnerships. A few even achieved unicorn status, exemplified by V.E. Corporation, which operates a virtual studio and successfully secured investments in the ballpark of 100 billion Korean won, ascending to the unicorn realm.

However, with the economic slowdown and underwhelming business performance in metaverse-related ventures, the metaverse now finds itself on the precipice of crisis. Disney has shuttered its metaverse division, Microsoft has restructured its virtual workspace platform, AltspaceVR, and Walmart has terminated its metaverse project. Even Facebook, rebranded as Meta, placed greater emphasis on AI rather than the metaverse in its recent performance announcements.

The adaptation of users to the metaverse has proven to be a more protracted process than anticipated, leading companies to fall short of their expected profits. Consequently, risk-averse investors are recoiling from metaverse investments. This decline in financial backing can be attributed to concerns about the industry’s nascent stage and the uncertainties surrounding its potential for success.

Nevertheless, it would be premature to conclude that interest in the metaverse has entirely dissipated. In Korea, although reports of large-scale investments have dwindled, there are still metaverse startups like AmazeVR, Anipen, A-Fun Interactive, and N. Dot Light that consistently manage to secure investments year after year, positioning themselves to dominate the market. Furthermore, companies specializing in virtual character production continue to emerge. The metaverse continues to be viewed as a promising nascent industry, albeit one that necessitates time for infrastructure development and user adaptation before it can fully flourish.

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