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Startups

Korea's top online flea market startup value up to $2.6 bn

New investors such as DST Global, Aspex Management and Reverent Partners join the Series D funding round

By Aug 18, 2021 (Gmt+09:00)

2 Min read

Karrot Market's UK website. Karrot is Danggeun Market's overseas version. (Image captured from the website)
Karrot Market's UK website. Karrot is Danggeun Market's overseas version. (Image captured from the website)

South Korea’s No. 1 online flea market operator Danggeun Market Inc. has increased its valuation to $2.6 billion as it raised $153 million from major venture capital funds. Danggeun plans to use the proceeds to expand overseas markets and invest in other business areas.

Danggeun said on Aug. 18 that it has received 178.9 billion won ($153 million) from new investors including DST Global, Aspex Management and Reverent Partners, as well as existing investors such as Goodwater Capital, SoftBank Ventures Asia, Altos Ventures and Kakao Ventures through a Series D funding round.

South Korea-based GS Retail Co., the retail chain unit of GS Holdings Co., was also known to have invested 20 billion won in the unicorn startup as a limited partner of one of the VC firms, according to investment banking industry sources.

The online secondhand marketplace said it has so far raised a total 227 billion won from investors. It achieved unicorn status as its valuation reached around 3 trillion won ($2.6 billion), 15-fold growth compared to its 200 billion won valuation in 2019.

“Local business is rapidly growing in overseas markets. It was confirmed that the philosophy and service model of the Danggeun Market, which focuses on the keyword ‘neighborhood,' was competitive enough to work in the global capital market,” said Kim Yong-hyun, its co-founder and co-CEO.

Danggeun, which currently has over 15 million monthly active users (MAU) and more than 10 million weekly active users (WAU), has more than tripled its user base every year since 2018. The number of MAUs was a mere 500,000 in January 2018 when it expanded its coverage to the entire country, but it had exceeded 1.8 million by a year later. The number reached 4.8 million in 2020 and topped 14.2 million this year.

The company plans to use the proceeds to advance its technologies, beef up overseas expansion, hire additional employees and boost marketing efforts at home and abroad to position itself as an unrivaled local superapp. It will also invest in advanced artificial intelligence and machine learning technologies.

Danggeun, which means carrot in Korean and is also short for “in your neighborhood,” aims to strengthen its local commerce business with Danggeun Pay to be launched later this year.

The company that already launched a global version of the hyper-local community app Karrot plans to expand overseas markets beyond its current coverage of 72 regions in four countries – Canada, Japan, the UK and the US.

It will also increase its workforce by 50% to about 300 within this year from around 200 currently by recruiting new employees for about 40 positions in areas such as development, design, marketing, strategy and overseas business.

Write to Chae-Yeon Kim at why29@hankyung.com
Jongwoo Cheon and Danbee Lee edited this article.
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