Is kimbap a burrito? 🌯
Join the Club
Clubhouse: The Seoul Startups community is meeting weekly on Fridays at 10AM Seoul time - that’ll be 5PM in San Francisco | 8PM in New York | 1AM in London.
Last week, we hosted Korean Tech Talks with Philip Lee and Summer Park. We covered trends and hot topics including the Korean New Deal, the virtuous cycle of capital, and IPOs on our radar. Philip is hyped about Yanolja. “The founder is a symbol of the Korean dream. He was once cleaning staff at hotels, and today he is the CEO of one of the fastest growing travel tech companies in the world,” he said, “It’s like a K-drama.”
Next week, we’ll be continuing the conversation with deep dives into some of the headlines below.
Last weekend, hundreds of K-pop songs disappeared from the global streaming service. A lapse in the licensing agreement with Kakao M, Korea's largest K-pop music distributor, resulted in artists such as IU, Epik High, and Seventeen getting booted off the airwaves.
But the blackout didn’t affect users in Korea. So what happened?
Rewind: It smells like power play. Spotify launched in Korea just last month - putting them in direct competition with Kakao M-owned Melon, Korea's most popular music streaming service with over 9 million monthly users.
According to Soompi, a website dedicated to K-pop news, Spotify explained, “We were unable to reach an agreement to renew our global license despite our best effort over the past year and a half.”
Kakao M responded pointing the finger back at Spotify. They claim that the global streaming service chose not to renew the agreement even after a request on their part.
For the record: Both parties maintain that the global license is unrelated to operations in Korea. 👀
Quote: “The world of K-pop is in chaos right now,” wrote one user on the subreddit r/kpop.
Uber’s back, tell a friend
The scoop: Last October, Uber and SKT teamed up to re-launch an Uber-branded service in Korea. SKT then turned T Map Mobility into a standalone unit to boost innovative initiatives and form the partnership. After that, Uber invested $100 million in the joint venture with a 51% stake, and another $50 million into T Map Mobility directly.
UT is going head to head with Kakao Mobility, which controls 80% of the taxi-hailing service market in Korea. But T Map plans to leverage its mobile-based navigation system to offer a superior experience. UT will tap into data and features from T Map Taxi and T Map parking to offer Uber-style ride-hailing services...with a few adjustments.
Political tensions: Uber launched operations in Korea back in 2013 but had to withdraw because of political backlash. Things got real ugly when Kakao tried to launch an Uber-equivalent carpooling service a few years later. Two taxi drivers self-immolated in front of the National Assembly in protest.
Since then, Kakao kept its services limited to taxi-hailing, allowing drivers to operate within the technology framework. UT looks to do something similar. Instead of its usual model enticing drivers looking for a side hustle, UT will both own and operate the vehicles in use.
Zoom out: For SKT, the partnership with Uber is an opportunity to leverage the company’s proprietary technology, product expertise, brand, and network to grow its mobility services. But it seems like an even bigger play for Uber.
The global powerhouse brand might finally become profitable. Prior to the pandemic, CEO Dara Krosrowshah promised shareholders that the company would reach profitability by the end of 2020. But alas, 2020 happened. At the height of the pandemic in May, Uber slashed 7,000 jobs and moved to consolidate or close 45 international offices.
Looking forward: While Uber has come to dominate the ride-hailing industry in most parts of the world, it has struggled to compete in East Asia, Southeast Asia, and Russia. In these markets, Uber has opted for growth behind the scenes. They own 15% of Didi Chuxing in China, 16% of Grab in Southeast Asia, and 35% of Yandex Taxi in Russia.
UT will now comprise Uber’s largest foreign holdings. It’ll be quite the win if SKT does manage to grow the T Map Mobility business to its target $4 billion value by 2025.
Zepeto lets you try on Gucci
Gucci partnered with Zepeto, a 3D avatar app, to create their virtual Gucci Villa showcasing the luxury brand’s latest collection. Users can dress their Zepeto avatars in pieces from Gucci’s collection through in-app purchases and explore the Gucci Villa in style.
The ‘virtual landmark’ has had over 1.3 million visitors since opening last month.
Backstory: Zepeto, developed by Naver in 2018, allows users to create personalized avatars using real photos and place them in virtual reality settings. The app has over 150 million users, with 90% being from outside Korea. It generates most of its revenue from advertising, but a portion also comes from in-app purchases.
Beyond the application itself, Zepeto offers companies a way to refresh their marketing approach. In 2018, Nike sought out a collaboration to roll out virtual sneakers for Zepeto avatars. It sold over 5 million pairs.
Zoom out: In the new normal, winning brands are the ones integrating online and offline customer experiences through omnichannel strategies. The Gucci gang looks like they’re ready to roll.
On the Radar
Companies raising over $1 million last week.
Fint is raising $8.8 million in a Series A deal from Megastudy from BC Card for their mobile discretionary investment service.
Ggumigi is raising $5.8 million in a Series B round from Atinum, Primer Partners, Breeze Investment and Woomi Global for their dedicated home decor e-commerce platform.
Guhada is raising $4 million in a Series A deal from Korea Investment Partners, Korea Growth Investment Corporation, POSCO Tech Investment and GS Homeshopping for their blockchain-based e-commerce platform.
Logislab is raising $2.2 million in an undisclosed deal round with SK Energy for their freight forwarding solution.
Uniquegood is raising $1 million in a Series A deal from Youjin Investments and The Wells Investments for their game ‘Real World’.
More Seoul hits
Coupang starts trading on the NYSE on March 11. The Korean darling of e-commerce will debut with 100 million new shares priced between $27-30.
👋 Prime Minister. Korean Prime Minister Chung Sye-kyun joined Clubhouse as @gyunvely. His bio reads “노란잠바 그 아저씨” or “That Yellow Jacket Guy,” a reference to the Korean civil defense uniform worn by politicians in times of crisis.
Unicorn hype from the Korean government is on a whole other level. The Ministry of SMEs and Startups launched an incubation service for ‘baby unicorns’. Scope this promo video featuring a talking unicorn head. 🦄.
Yay or nay? Can kimbap be considered something like a burrito? Drop us a line on that or anything else on the Korean tech scene in the comments section.