Harvard Dropout's Startup Loses Billions in South Korea Battle

[cyclone]

Harvard Dropout's Startup Loses Billions in South Korea Battle

By Sam Kim
May 23, 2018, 5:00 AM GMT+8

Coupang won over fans with personalized service for e-commerce in South Korea, picking up $1 billion of funding from Masayoshi Son along the way. Analysts are now questioning if that is enough as the nation’s powerful chaebol turn their resources to dominating online like they do in the physical world.

While Coupang’s sales are rising, that is coming at a massive cost as losses reached 638 billion won ($592 million) last year. Retailers backed by the SK and Lotte conglomerates are subsidizing web forays with money from their profitable brick-and-mortar outlets, crowding out Coupang and denying oxygen to the eight-year-old startup.

“In a war of cash, Coupang is losing money it can’t afford to, while bigger companies can,” said Park Jong-dae, an analyst at Hana Financial Investment Co. “It’s cutting margins to increase its market share, but that’s not helping to lock in customers, because they would readily flock to cheaper deals at other companies.”

More detals in https://www.bloomberg.com/news/articles/...th-chaebol

[Big Toe]

Storyline is the same for all unicorns.
The successful ones will probably be the ones that breaks even(and eventually making a profit) before funding/investors break down.
It is easy to see which will continue losing money for the foreseeable future but much much more difficult to see which ones are viable in the longer term.
In the meantime, the whole community delude themselves by attaching a higher valuation, a necessity for subsequent rounds of funding.

So on one hand you have unrealistic valuations on the unicorns while in the SGX as well as certain companies in other markets,
some constantly profitable companies are valued like they are bankrupt.