October 5, 2021
5 mins

Korea is at a tipping point.


For those who follow our news section, you will have seen a number of significant start-up capital raises in South Korea this year. This week, VUNO, which was the first company to receive Korean regulatory clearance for a medical AI solution, went public raising US$33.4Mn.

Showcase of VUNO's AI-based bone age diagnostic

Companies like VUNO form part of a trend not only of greater capital raising but an overall shift in Korea’s economy.

Start-ups are becoming giants

In the last few years, start-ups have broken into the ranks of the 20 biggest companies in Korea, and that trend is accelerating.

Top 20 Korean; the size of the circles are a function of their market capitalisation. Data from November 2020.

Naver, Kakao and NC, which were founded in the nineties, are gaining more and more ground on huge players like Samsung, LG or Hyundai.

There is more where they came from

Naver, Kakao and NC represent the first generation of start-ups, and there is a much bigger cluster behind them.


Of the 12 Korean unicorns, 7 were founded in the last 12 years. We estimate there to be over 100 companies with the potential to become unicorns in the near future.

Investments are on the rise

Against this backdrop, the amount of money going into Korean start-ups is rising, and being incentivized by the government.


So why is South Korea at a tipping point?

In the near month or so, e-commerce start-up, Coupang, will list for a valuation of around US$50Bn. Later in the year, gaming company, Krafton, is expected to list for a valuation of around US$27Bn. This is going to create a step-change in how people view Korea. Working in and amongst Korean start-ups here in Seoul, I can feel the excitement from budding entrepreneurs. Really bright young people are considering setting up a start-up rather than joining Samsung. When I look across Korean start-ups, I see companies internationalizing. Companies like:

- Karrot, a community-based second-hand marketplace, recently launched in the UK

- Jandi, a workplace messaging and collaboration tool, now offers its product in English

- ThorDrive, an urban autonomous driving car company, is testing unmanned self-driving ground service equipment at Cincinnati International Airport

- Toss, a fintech company, has 300,000 monthly active users in Vietnam and is expanding in Asia

- Additor, a collaboration tool, is focussed primarily on the USA

Today, only around 5% of the capital invested in Korean start-ups comes from overseas, which means start-ups do not have easy access to international markets. We think that is about to change.

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