Kakao forays into pet taxi service; buys Pet Me Up

South Korea-based Kakao Mobility Corp., a subsidiary of mobile giant Kakao Corp., has acquired the country's leading pet taxi service, Pet Me Up, in a move to broaden its business portfolio from franchise taxi services to new ventures including pet taxi, car wash and parking services. 

Kakao Mobility will set up a pet taxi division and offer the service via its mobility platform Kakao T, according to the Pet Me Up operator Natuspin on Mar. 9. Most of Natuspin's employees, including its founder Park Na-ra, will join Kakao Mobility to spearhead the division.

Kakao Mobility is set to become the official provider of Pet Me Up on Mar. 22.

Founded in 2016, Pet Me Up is the country’s No. 1 pet taxi service. Its standard fare begins at 11,000 won ($9.70), a bit higher than general taxis, but the service has become a huge hit among pet owners as it allows them to use taxis without putting their pets in carriers. So far, Pet Me Up has been used over 50,000 times. 

“The pet market is a blue ocean that may expand beyond our current projections. It is also why Kakao Mobility has taken chances with the company," said an IT industry official. “The synergy between the country’s largest mobility platform and the No. 1 pet taxi service will be tremendous,” the official said.

According to the Ministry of Agriculture, Food and Rural Affairs, there were around 5.91 million households with pets in Korea as of 2019. The domestic pet market is expected to reach 6 trillion won ($5.3 billion) in 2027.

STRATEGIC MOVE TO WIDEN GAP WITH SMALLER RIVALS

Recently, Kakao Mobility has steadily expanded its business into various areas, such as car wash, parking, and train ticket reservation services, in addition to its core revenue sources -- franchise taxi and designated driving services.

The company's portfolio diversification is deemed the groundwork for Kakao Mobility to set itself apart from other firms and enhance revenue stability. Next month, SK Telecom Co. and Uber Technologies Inc. will launch their joint venture, UT LLC, which is likely to threaten Kakao Mobility's franchise taxi operations.

Other mobility startups, including VCNC and Jin Mobility Inc., have rolled out franchise taxi operations. KST Mobility, the operator of Macaron Taxi, has also tapped into the pet taxi market.

“Kakao Mobility has solidified its leading position with over 20 million users, making it more stable in terms of business compared to other companies,” said a mobility industry official. “The company sees the pet taxi service acquisition as a way to occupy the market ahead of its industry competitors," the official said.

Write to Min-ki Koo and Byung-keun Kim at kook@hankyung.com
Danbee Lee edited this article.