2015's largest VC investment so far and it's not in Silicon Valley
It's this year's largest venture capital investment, so far by a single investor. And it didn't happen in Silicon Valley but in Asia. Coupang, a Korean e-commerce service raised $1 billion from SoftBank, that's the same firm that invested in Alibaba (BABA).
“This is really a sign that Silicon Valley can happen anywhere now. That the largest investment to date, this year is happening in a city in Asia,” said Eric Kim, co-founder of Goodwater Capital, an early investor of Coupang. With Seoul being one of the most technologically advanced cities in the world and certainly one of the most wirelessly connected, it provides a favorable platform for online shopping, which is increasingly becoming more m-commerce than e-commerce.
Coupang claims more than 70% of its transactions come from mobile. By comparison, the online retailer said more established competitors like Amazon (AMZN) and eBay (EBAY) have only about 35% of its transactions coming from mobile. The Korean city’s dense population also allows innovative leads with same day delivery, which is “an art but a science as well," Kim believes.
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“Coupang for the two past years has really been perfecting the same day delivery service,” stated Kim, who is also Coupang’s board member. “Now you’re seeing American players like Amazon, eBay and Google (GOOG) trying to get in the game.”
The other side to this story is the investor – Japan’s SoftBank, perhaps best known for its acquisition of Sprint in 2013. “We’re going to see these Asian players continue to make global investments…we’re going to see a lot more investments,” said Kim.
The venture capitalist advises his own startups in Silicon Valley to “pay attention to players in Asia because they’re really going to be their competitors, strategic partners or their acquirers or investors.”
As for where we can expect the next big funding in technology innovation, Kim predicts, “in the future, I see a lot more investments going into Southeast Asia as well.”
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