Korean Fashion Platform Capable of Raising $144 Million from Alibaba, Others

Ably Corp., a leading South Korean online fashion platform operator, is poised to raise 200 billion won ($144 million) from foreign investors such as China’s Alibaba Group Holding Ltd. despite a prolonged slump in the country’s startup-funding market. It is being valued at $2.2 billion.

The startup that runs South Korea’s leading women’s clothing shopping app Ably has signed letters of intent with various investors, including Alibaba and institutions from the US, UK, Singapore, Canada and the Middle East, investment banking sources said on Monday in Seoul.

Further details such as the spending figures and the names of all investors are not available, although in April, Alibaba was in talks with the startup to buy a 5% stake in Aly for around 100 billion won.

“The investment round will be completed next month,” said a source at the investment bank. “Aly’s corporate value has been estimated at 3 trillion won ($2.2 billion), as far as I know.”

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

South Korean startups are hoping that Aly’s latest fundraising will provide a boost to a long-running investment slump, industry sources said.

“It’s important for a local startup to become a unicorn, with an enterprise value estimated at 3 trillion won by global investors, when the industry has been suffering from a persistent funding winter since last year,” said a source in the venture industry. “I hope the deal will revive the overall sluggish startup industry.”

EXPANDING GLOBAL SALES

Ably aims to boost sales of South Korean fashion items in global markets, as the terms of the investment agreement include support for local sellers to expand onto the platform into overseas markets such as Southeast Asia and North America.

The startup currently helps South Korean retailers sell products in Japan through its online women’s fashion platform amood.

Ably added 8.33 million monthly active users (MAUs) last month, becoming the number one fashion e-commerce platform in South Korea. It has developed the industry’s first AI-powered algorithm to offer personalized recommendations and has the largest user database in the industry, exceeding 2.5 billion, according to app analytics firm Wiseapp Retail Goods.

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

Aly reported its first-ever operating profit of 3.3 billion won last year, up from a loss of 74.4 billion won in 2022, while sales rose 44% to 259.5 billion won.

write to Hyung-Joo Oh at [email protected]

Jongwoo Cheon edited this article.