K-beauty is not a trend. At this point “K-beauty” can simply be called “beauty”, as Korea has firmly established itself as the literal global leader of cosmetics trends. Buzzwords like hallyu have long passed their expiry dates and it’s now perfectly normal to smear snail cream all over your face to start the day.

 

For those uninitiated into the world of Korean cosmetics, K-beauty began spreading across Asia several years ago, as Asian cosmetics buyers looked for a combination of quality, trustworthiness and cost that only Korean brands were providing. Now K-beauty has permeated most types of color cosmetics and skincare products all over the world. In 2017, it’s not uncommon for a even casual cosmetics buyers to be familiar with at least one or two Korean skincare brands. It’s not just the result of a powerful, nation wide marketing ploy, Korean products are famous for good reason.

 

 

Koreans began using sheet masks and sun creams decades before Western markets ever heard of BB cream, let alone snail mucus. Nowadays, K-Beauty is the only way to banish blackheads and laugh lines, and not just because it’s trendy but also because they produce results.

 

Initially, products with names like sea urchin toner held a certain novelty factor. In 2017, it’s only a matter of time before (the poorly named) sheep oil sneaks its way into your daily routine. After just a few minutes of searching on any major social media channel, you’ll find countless K-beauty guides, routines, reviews and tutorials.

 

The way Koreans use their products is very different from in the West. On a large scale, Koreans exercise almost no brand loyalty. They’re ready to spend on the big names, only if the products work. As soon as a competitor retaliates with a superior item, you can be sure that the consumer base will shift. Some Korean startups have managed to wrangle the masses and have created a great deal of momentum with a consistent flow of quality and innovative products.

 

That local momentum has given these beauty brands the velocity they need to launch into markets around the globe. Startups like Memebox, Aprilskin and Althea all have a dominant presence in and outside of Korea.

 

Memebox lead the way raising over 114 billion won (114 million dollars) in 2016, alone. This ticked their overall valuation to a whopping 1.57 billion dollars. Memebox started with a subscription service and have since expanded to full-sized retail stores along the same lines as makeup powerhouse Sephora.

 

AprilSkin are another skincare giant who have dedicated themselves to making quality products that are accessible. They blew up vanity tables around the world with the launch of their viral hit ‘Magic Stone Soap’ and haven’t stopped since. AprilSkin is a perfect way to look at the growth of the industry as a whole with $36 million in sales last year and are on track to hit over $90 million in sales in 2017.

 

 

The overwhelming presence of K-Beauty in the U.S is just as impressive as its products. K-Beauty grew by 30% from 2015 to 2016 (that’s $225 M in sales). Now, you’ve got retail giants like Target, Sephora, Ulta and even Nordstrom carrying Korean skincare products. Estee Lauder is investing in K-Beauty now too. Last year, they invested in Have & Be Co. Ltd., the owner of Do The Right Thing and Dr. Jart+.

 

Now it’s clear that K-beauty is here to stay. Now, it’s up to Korean brands to make sure that their lines continue to innovate, shock and please Western, Asian and Korean customers. There have been some raised eyebrows at Korean companies choosing to target western audiences first and what constitutes ‘real’ Korean beauty. South Korea has a gigantic export market on their hands, who knows when or if this $11 billion dollar jar of salmon egg cream will eventually run dry. 

 

 

 

 






Erik Cornelius

Co-Founder, G3 Partners


Erik is Co-founder and COO at G3 Partners. He has more than a decade of PR, marketing and market research experience in Korea, serving clients ranging in size from startups to Samsung. His professional passion is telling the stories of Asian startups to the rest of the world.


G3 Partners are Asia’s startup marketing, communication and investment experts.

They provide a full suite of global services for startups expanding overseas and raising investment internationally.


 

 

Discover Korea’s Startup Investment Trends: Crowdfunding

 

This is the las post in our 4 series of investment trends. Born2Global discusses about venture capital investment, angel investment, EXIT, and crowdfunding.

 

 

Crowdfunding

 

Investment crowdfunding was first introduced in Korea in 2016. The term “crowdfunding” is a portmanteau of “crowd” and “funding” and refers to the practice of raising monetary contributions from unspecified number of small investors for startup founders and others who need funds through an intermediary (small, online investment brokers, etc.) via the Internet. Through investment crowdfunding, backers receive equity shares of the companies in which they invest.

 

Following the introduction of investment crowdfunding in Korea, a total of USD 109.09 thousand was issued for USD 109.09 thousand worth of subscriptions in February 2016. Afterward, however, issuing prices fell far short of offering prices. In June 2016, only USD 745.46 thousand was issued for USD 2.07 million worth of subscriptions. In general, the issuance rate has stabilized at around 50 percent a month.

 

Immediately prior to and after the introduction of investment crowdfunding, a huge number of crowdfunding intermediaries emerged, giving a major boost to the crowdfunding market. From the perspective of venture-backed companies, it is a particularly attractive investment method, as they are able to free themselves from their dependence on VC firms and loans from the financial sector by raising funds from among people in general. However, the expansion of peer-to-peer (P2P) lending in recent months has been pointed to as an obstacle preventing crowdfunding from taking root in Korea.

 

 

*Unit: USD 90.91 thousand, Exchange rate: 1,100KRW/1USD

 

 

 

 

Discover Korea’s Startup Investment Trends: Crowdfunding

 

This is the las post in our 4 series of investment trends. Born2Global discusses about venture capital investment, angel investment, EXIT, and crowdfunding.

 

 

Crowdfunding

 

Investment crowdfunding was first introduced in Korea in 2016. The term “crowdfunding” is a portmanteau of “crowd” and “funding” and refers to the practice of raising monetary contributions from unspecified number of small investors for startup founders and others who need funds through an intermediary (small, online investment brokers, etc.) via the Internet. Through investment crowdfunding, backers receive equity shares of the companies in which they invest.

 

Following the introduction of investment crowdfunding in Korea, a total of USD 109.09 thousand was issued for USD 109.09 thousand worth of subscriptions in February 2016. Afterward, however, issuing prices fell far short of offering prices. In June 2016, only USD 745.46 thousand was issued for USD 2.07 million worth of subscriptions. In general, the issuance rate has stabilized at around 50 percent a month.

 

Immediately prior to and after the introduction of investment crowdfunding, a huge number of crowdfunding intermediaries emerged, giving a major boost to the crowdfunding market. From the perspective of venture-backed companies, it is a particularly attractive investment method, as they are able to free themselves from their dependence on VC firms and loans from the financial sector by raising funds from among people in general. However, the expansion of peer-to-peer (P2P) lending in recent months has been pointed to as an obstacle preventing crowdfunding from taking root in Korea.

 

 

*Unit: USD 90.91 thousand, Exchange rate: 1,100KRW/1USD

 

 

 

 

Discover Korea’s Startup Investment Trends: Crowdfunding

 

This is the las post in our 4 series of investment trends. Born2Global discusses about venture capital investment, angel investment, EXIT, and crowdfunding.

 

 

Crowdfunding

 

Investment crowdfunding was first introduced in Korea in 2016. The term “crowdfunding” is a portmanteau of “crowd” and “funding” and refers to the practice of raising monetary contributions from unspecified number of small investors for startup founders and others who need funds through an intermediary (small, online investment brokers, etc.) via the Internet. Through investment crowdfunding, backers receive equity shares of the companies in which they invest.

 

Following the introduction of investment crowdfunding in Korea, a total of USD 109.09 thousand was issued for USD 109.09 thousand worth of subscriptions in February 2016. Afterward, however, issuing prices fell far short of offering prices. In June 2016, only USD 745.46 thousand was issued for USD 2.07 million worth of subscriptions. In general, the issuance rate has stabilized at around 50 percent a month.

 

Immediately prior to and after the introduction of investment crowdfunding, a huge number of crowdfunding intermediaries emerged, giving a major boost to the crowdfunding market. From the perspective of venture-backed companies, it is a particularly attractive investment method, as they are able to free themselves from their dependence on VC firms and loans from the financial sector by raising funds from among people in general. However, the expansion of peer-to-peer (P2P) lending in recent months has been pointed to as an obstacle preventing crowdfunding from taking root in Korea.

 

 

*Unit: USD 90.91 thousand, Exchange rate: 1,100KRW/1USD

 

 

 

 

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