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How India is becoming 'heaven' for Korean startups

India, the world's 4th-largest unicorn producer, becomes an attractive destination for startups seeking overseas expansion

Jun 02, 2021 (Gmt+09:00)

Ambassador of India to South Korea, Sripriya Ranganathan
Ambassador of India to South Korea, Sripriya Ranganathan

India is becoming an attractive destination for South Korean startups that are eyeing overseas expansion, given the country's vast population and diverse markets offering rich opportunities for potential investors.

"The Indian market offers something for everyone -- from the high-end to the mass markets," said Sripriya Ranganathan, the Ambassador of India to South Korea, in an interview with The Korea Economic Daily at the non-profit foundation D.CAMP office in Gongdeok, Seoul on Jun. 2.

India is the world's third-largest economy, following the US and China. It boasts a vast market size with a population of around 1.4 billion and over 40,000 startups.

It is also the world's fourth-largest producer of unicorns, having produced 50 unicorns, of which 15 emerged between January and May this year. 

"Most of the unicorns are in the edutech, foodtech, gaming and entertainment areas -- all of which Korean startups also excel in," said Ranganathan.

According to Ranganathan, what makes India attractive for potential investors is its population and market outreach, which has driven many Korean conglomerates and domestic VC firms to tap into the market.

For example, Hyundai Motor has invested in India's mobility sector while Samsung Electronics has invested in the edutech segment. Also, the Mirae Asset-Naver Asia Growth Fund and KB Financial Group's global venture capital fund have been actively investing in India's startups.


The startup ecosystems in Korea and India are a great match because Korea has the capital power while India has the manpower. Also, Korean startups have a strong need to bring their technology into a commercialized market -- one which India offers with its scalability, said Ranganathan.

"In India, there are over 1 billion mobile phone users, which translates into a huge wealth of data, one which India is unrivaled in terms of offering companies a market to test, improve and refine business models," said Ranganathan.

Also, Korean startups and Indian startups are similar in the sense that both are intrinsically tech-oriented and tech-savvy, with an aptitude for making the most of the ICT world we live in today.

But Korea is facing a dwindling and aging population and there is a need for companies to reach out to different economies in different stages, according to Ranganathan.

"This is where India can fill in the gaps, given that the country’s human resources lie across the entire range of population and sectors. Companies can have a pilot service that taps into a community that goes from hundreds to tens of millions," said Ranganathan.

Korean companies that enter India can enjoy the benefits of India’s ecosystem, which are namely low costs, rich manpower, friendly regulations, English-speaking capacity, and the large market itself.

And now, Korean startups are increasingly seeing India as a place where they can not only test but also market their services to have an impact and be profitable, said Ranganathan.

For example, domestic foodtech startup GoPizza Co. has become a huge hit in India, opening up branches across major cities as its unique menu items such as bulgogi pizza and sweet potato pizza attract customers.

Last October, the company's Bengaluru outlet reported the highest revenue of GoPizza's branches in India.

In terms of popular sectors, edutech, fintech, foodtech, gaming, healthtech – all of these areas have been booming in India because of the country’s massive population, said Ranganathan, noting that there has been a rise in Indo-Korean startups of late, especially in the edutech sector.

Indian companies are increasingly looking at potential partnerships with Korean startups and investors, said Ranganathan, explaining the importance of building partnerships for companies to gain a better understanding of what's beyond the surface.

For example, Korean confectionery giant Orion Corp. partnered with India's processed food manufacturer Mann Ventures to expand its operations in India.

Also, earlier in March, South Korean fintech startup Balance Hero raised around $10 million in debt funding led by the India-based non-banking financial company (NBFC) Northern Arc. 

“What we’re trying to do is to create opportunities for Indian startups and Korean startups – for the VC firms and funds to come together on the same platform,” said Ranganathan.

By Danbee Lee
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