Coupang was established in August 2010 with only 7 staff and monthly turnover of 190 million won. Only 22 months later the company had achieved 5th ranked Korean e-commerce company, and profitability along with it. Coupang, which has seen steady growth since then, continued to strengthen its position as a Social Commerce leader and in the last two weeks 'Business Insider' evaluated the company's net worth at $1.5 billion and placed the company at 19th rank in terms of unlisted global IT start-ups. Coupang is the first Korean startup to be ranked in this line-up.
More about Bom Kim: Against the advice of his professors, Bom Kim dropped out of the Harvard Business School to start his own daily deals site. This year Coupang, a forerunner to Groupon, is on track for revenue of $600M this year. In a presentation at Altos Ventures’ conference in Half Moon Bay, Calif., Kim said that Coupang's achievement of 5th place in Korea is a big deal because of the unique characteristics of teh domestic market.
He emphasized that the country is very densely populated, with 50 million people living in the limited habitable areas, which combined are about the size of Massachusetts. About 75 percent of Koreans live in an urban area. That means that making deliveries to people is cheap and easy, Kim continued. The country also has 95 percent broadband penetration, and its e-commerce market is the sixth-largest in the world, and is forecast to grow from $24 billion in 2011 to $45 billion in 2015.
Korea is also “pretty allergic to outside tech companies”, stated Kim. Groupon has spent tens of millions of dollars in the market but is about a fifth the size of Coupang in terms of revenue, Kim said. And Google has just a few percent of the search market, where Naver still holds sway. "It’s like the Greece of Asia,” Kim said. “You can’t invade it from the outside.”
Altos Ventures invested in Coupang in August 2010, when the company had about $100,000 in revenues. Now it has 12 million subscribers, 732 employees, and 25,000 merchants selling goods on its marketplace. Besides Altos, investors include Maverick Capital and other seed investors.
“That’s a testament to the growth in the Korean market and how hot the social commerce space is,” Kim said. “We’ve done this by taking the best practices of the East and West.”
About 80 percent of the company’s business is the delivery of physical goods ordered via e-commerce sites. Most of the revenue is generated by people who visit the site every day.
So take that, Harvard Business School.
More about Bom Kim, courtesey of VentureBeat
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