Korean fashion platform Ably to raise $144 mn from Alibaba, others

Ably Corp., South Korea’s top online fashion platform operator, is set to raise 200 billion won ($144 million) from foreign investors such as China's Alibaba Group Holding Ltd. despite the prolonged slump in domestic startup funding, with its valuation estimated at $2.2 billion.

The startup operating South Korea’s No. 1 women's clothing shopping app Ably has signed letters of intent with various investors including Alibaba and institutions in the US, UK, Singapore, Canada and the Middle East, according to investment banking industry sources in Seoul on Monday.

Further details, such as spending values and names of all investors were not available, although Alibaba discussed purchasing a 5% stake in Ably for about 100 billion won with the startup in April.

“The investment round will be concluded next month,” said an investment bank source. “Ably’s corporate value was estimated at 3 trillion won ($2.2 billion) as far as I know.”

Ably became the first unicorn, or a startup valued at $1 billion or more, this year in South Korea with the deal. The company succeeded in attracting investors, who highly regarded its loyal customer base, especially women in their 20s and 30s, according to industry sources.

South Korean startups hope Ably’s latest fundraising serves as momentum to revive the prolonged investment slump, industry sources said.

“It is significant for a local startup to become a unicorn with a corporate value estimated at 3 trillion won by global investors when the industry has been suffering from the sustained funding winter since last year,” said a venture industry source. “I hope the deal will vitalize the sluggish startup industry overall.”

TO EXPAND GLOBAL SALES

Ably is set to increase sales of South Korean fashion items in global markets as the terms of the investment contract included support for the expansion of local sellers on the platform into overseas markets such as Southeast Asia and North America.

The startup currently helps South Korean merchandisers sell products in Japan through an online female fashion platform amood.

Ably secured monthly active users (MAU) of 8.33 million last month, becoming the No. 1 fashion e-commerce platform in South Korea, with the industry’s first algorithm for artificial intelligence personalized recommendations it developed and the industry’s largest user data of more than 2.5 billion, according to data from app analytics firm Wiseapp Retail Goods.

Among the country’s entire online shopping platforms, Ably was the No. 2 player after the domestic e-commerce giant Coupang Inc., which had MAU of 31.12 million. That compared with major Chinese players such as AliExpress with MAU of 8.3 million and Temu with 7.97 million.

Ably reported its first operating profit of 3.3 billion won last year, swinging from a loss of 74.4 billion won in 2022, as sales jumped 44% to 259.5 billion won.

Write to Hyung-Joo Oh at ohj@hankyung.com
 

Jongwoo Cheon edited this article.