Facts That Make The Korean Startup & Tech Environment One of The Most Interesting in Asia

This article gives a round-up of recent news from the Korean startup and tech environment. Please feel free to suggest updates and additional news. If you want to check out Korea for yourself, we suggest coming to Seoul, May 14-15, for beLAUNCH, Korea’s top tech and startup event. While the event is based in Korea we welcome startups from across the world and have secured a top line-up of global speakers who will inspire and educate regardless of where in the world you are building your startup.

Tech Environment

  • Almost 40M LTE users (total population = 50M)
  • Koreans pay on mobile (Korea #3 in world on Google Play revenue)
  • Koreans are early adopters (Korea #2 in world for app downloads)
  • Korea has fastest mobile broadband in world (introducing 5G network this year)
  • Social engagement is high (Kakao has 97% penetration on Korean smartphones, Facebook & Twitter doing well)
  • E-Commerce is strong (#3 market in Asia and growing rapidly)
  • Platforms are deeply entrenched (Cyworld was 1st social platform, released 2 years before Facebook)
  • Korea is dense – 50% of population live in Seoul (spread / adoption of new tech is rapid and comparatively cheap)
  • Atlassian, an Aussie company, is big in Korea (they are speaking at our conference this May and see Korea as a key market)

The Korean Startup Ecosystem in Global Press

Important Up-Coming Exit News

  • Kakao, Korea’s top messaging App is heading towards a $4Bn IPO next May. The company has built a powerful social media platform in Korea and is seeing measured global success
  • Coupang (Founded 3.5 years ago) is heading towards a multi $Bn IPO in next 12 months, while details on the ground are sparse at this stage

Gaming in Korea Remains Strong

  • Gaming company, SundayToz, IPO last year The company first saw massive success with its title ‘AniPang’, which was the first game released on the Kakao Games Platform in July 2012. Their follow-up title ‘Anipang2′ has also held a top 10 spot since release. SmileGate recently baught a 20% share in the company for $112M, becoming the largest stakeholder
  • Korean game developer Devsisters achieved 20M downloads in 10 months (only Korea). They make $20M per quarter over same period. They also achieved 20M downloads in 2 months, since releasing the game on Line Messenger in 5 languages
  • Korean PC game, Crossfire, from developer Smilegate is highest grossing game in world 2012 – 2013 – over $1Bn revenue in 2013 (more than Clash of Clans, though profit margin is lower @ 25%). Smilegate recently purchased a 20% stake in SundayToz for $112M and is the leader of a robust gaming ecosystem in Korea. The strategic investment in SundayToz marks a clear move towards mobile for teh company.

BitCoin

  • BitCoin startup, Korbit raised funding from 5 high profile Silicon Valley investors this year, including DFJ
  • CoinPlug, Korean BitCoin startup raises two rounds of funding ($800k) from Silicon Valley this year and has rolled out bitcoin ATMs in a number of locations in Seoul

The Top Startup Stories of Recent Months

  • Translation App, Flitto was first Korean startup at Tech Stars London last year. Currently translates 90% of all tweets that are translated and just raised $3M from Silicon Valley
  • Beauty curation service, Memebox has just raised almost $1M from Silicon Valley and is first Korean startup at Y Combinator. Selected as third best startup from their batch.
  • Couples App, VCNC reached 5M downloads and $4.5M in investment. Currently top app in social category in Japan
  • Big Data Service, 5Rocks raises $2.5M in investment, after intro to GLobal Brain at beLAUNCH 2013
  • Social Network, Smile Family raises $1.5M in investment, having sold first company to Gree last year

Korean Unicorns

  • 5 Unicorns (company with over $1Bn valuation) built in Korea in last 5 years
    • TMon
    • Nexon
    • Kakao
    • Line
    • Coupang

Korean Accelerators link up with government Funding (1 : 5)

  • 10 Korean accelerators / investors have joined forces with the Korean government on a program that means every $100k investment (1 per month) from a VC into startups this year will be matched with $500k of tax payers money. That’s 50 teams before the end of the year!
1. Bon Angels
2. The Ventures
3. Future Play
4. Coolidge Corner Investment + CCVC Value-Up Center(BI) + Bootstraplabs
5. InnoPolis Partners (LLC)
Last year’s 5 consortium partnerships:
1. KEIT + Kaist
2. Capstone Partners (LLC) + Sparklabs + Asan Namun Foundation
3. Kcube Ventures + Seoul University
4. Founders Angel Networks + Hanyang University
5. Fast Track Asia + Postech University
  • Future Play is founded in April 2014. The founder of this new accelerator also founded Olaworks, which sold to Intel for $30M in 2012. Founder, Junghee Ryu is now injecting his financial and experiential capital back into the Korean ecosystem
  • The Ventures was founded in April 2014. The founder of this new accelerator also founded Viki, which sold to Rakuten in 2013 for $200M. Founder, Changseong Ho is now injecting his financial and experiential capital back into the Korean ecosystem

If you have additions / alterations to suggest please do so by emailing nathan@besuccess.com

Explore more about Korea at beLAUNCH 2014, Korea’s top startup event in Seoul May 14-15. Buy tickets here

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