Lee Seung-Gun-or “SG” for foreigners who are not familiar with Korean pronunciation-Hat a classic start-up history story that mixes persistence, repeated failure, ultimate success and dental care.
It started in 2011 when Lee left a private hospital in Samsung to start Viva Republica. “As a dentist, I started like all other Asian children whose parents want their children to be neurosurgeons or dentists,” he says with a laugh.
“When I was 29 or 30 years old, I had no dream. I just wanted to be a famous dentist,” he recalls. But he soon became restless and helped people on an individual level. “In order to achieve the effects on scale, I quickly realized that I had to concentrate on technology.”
His move into entrepreneurship had a difficult start. He dedicated 150 million savings – over 105,000 US dollars – his new company. “I failed eight times in the first five years,” he says. He attracts a few of what he calls “garbage ideas”: social media, a choice.
A Bloomberg report From 2018 it was found that Lee had only 20,000 Won ($ 14) in the bank and that the families of employees with the employees pleaded to continue working without paying.
Then he found an idea that worked: a money transfer service. “Toss was another stupid idea, but we were crazy enough to do it because we had nothing to lose,” he says with a smile. “And here we are.”
Almost 15 years after its foundation in 2011, Toss is now part of a larger fintech super-app, a single platform that combines bank, insurance, stock trading and money transfer services.
South Koreans have an average of five bank accounts and four credit cards – which means many different financial accounts for juggling. Lee believes that the reason has proven to be so popular because Koreans “have more occasions to check their finances”.
Viva Republica is now one of the best -known startup Korea, which is worth around 7 billion US dollars after a round of funding from 2022 worth around 7 billion US dollars. The company has supporters such as GIC, PayPal and Qualcomm Ventures. According to an estimate of 2021 of 2021 Forbes.
The TOSC platform claims to have almost 30 million registered users, which corresponds to around 60% of the entire population of South Korea. Over half of the company’s 25 million active users visit the app at least ten times a day.
“Our monthly active user base is actually a little shy about that of Instagram [in Korea]«, He boasts.
Super app success
Asia is treated with super apps, which contain platforms such as Tencent’s Wechat services such as messaging, payments, grocery delivery, news, games and more. Finance is a popular service for Knospe super appsEven for non-finance companies with Singapore Grab and Sea and Indonesia Goto under Asian platforms with fintech departments.
Super apps keep users on a single platform instead of sending them to another company. This enables cross-promotion, resource approval and other support between different services. It also makes it more difficult to switch to another platform: if everything you ever need is in an app, why should you try something else?
Nevertheless, great apps did not lose weight in the West, even if the model wins fans as possible X owner Elon MuskHe hopes to transform his social media network into a financial services platform.
Lee’s theory is that great apps go better with the Asian Internet, which initially lacked a lot of the digital infrastructure, underpinning the US startups.
In the United States, a new startup can rely on a large number of other companies that offer supportive services. These companies simply do not exist in Asia – even in wealthy countries such as South Korea. That means a platform like throw or its established Big Tech peers Naver and cocoa had to build these services themselves.
“When we launched our flagship money transfer service, it was loved by so many users so that we could grow very quickly. We quickly found that all other vertical finances were not covered by other players,” he explains. “There was a big emptiness on the Korea market, so that we could grasp these opportunities.”
Startup milestones
Viva Republica met an important milestone last year than it reported on his First annual profit Since it was founded over a decade ago. The company reported a net profit of 21.3 billion Koreans ($ 15 million) for 2024, compared to a loss of 216.6 billion won ($ 152 million) in the previous year. Sales also rose by 43% and reached 1.96 trillion Won (1.4 billion US dollars).
According to Lee, the first profit is a focus on the increase in sales and not on the market share. “In contrast to other fintech players, user growth does not really correlate with sales.
“In the next three to five years, it will be mainly a story to win more business customers,” he says.
Viva Republica’s profit also came from a strong growth of Wurf Securities, the platform’s stock trade. Lee notes that it is the only service that calculates a fee to users and contributes around 20% to the total turnover of the platform.
He added that the security grew quickly after its start in 2021 due to the TOW supera app.
“Robinhood took two years to maintain two million securities accounts,” says Lee. “We achieved that in five days.”
Town has a higher penetration among younger Koreans, with up to 90% of those in the twenties use the platform. Lee says that there are not many differences between the younger and older users of Town, but a big deviation is that newer generations are more open to investments in foreign stocks, especially in the USA
Now that Viva Republica has found a profitable business model, is the company on a way to a public debut, the next big milestone for a startup?
Lee says that Viva Republica is planning to go public “in the near future”, but refused to give specific details at time and location.
According to local media Viva Republica A US IPO is consideringLeaving plans to listen to South Korea at the end of last year. According to reports, the company believes that Korean stock markets do not really appreciate a fintech platform like Toss. (Lee refused to share details when it was pressed.)
The shares of the competing FinTech services Kakaobank and Kakaopay have lost around 70% and 80% of their value since their respective IPO of 2021.
Market confidence
Korean stocks often suffer from low ratings – sometimes called “.Korea discount“. Analysts accuse the threat of the nearby North Korea and the poor corporate management among the country ChaebolsThe massive conglomerates that dominate the economy. The country was considered Market reforms fit That would open up, similar to what was successfully persecuted From his neighbor Japan.
However, the reforms stalled due to a more urgent political crisis.
In December, President Yoon Suk Yeol then tried to impose war law on. After widespread protests by the public and the opposition, Yoon pulled his explanation back just a few hours later.
Legislators quickly suspended and clamped yoonTure months of political instability. According to the country’s constitutional court, things are now coming to an end confirmed the elevation of YoonOfficially removed him from office – the second time that a president was removed in less than a decade. Korea will hold Snap Presidential elections in early June.
Nevertheless, Lee believes that the crisis shows South Korea’s strengths. “I win more confidence in the market,” he says. “Everything was done by the constitution and the process was peaceful.”
“This is the turning point where we really have to concentrate on economic growth, not only from business people, but also from politicians,” Lee continues.
South Korea is composed of the boys with disillusionment, frustrated by high debts, unaffordable living space and more restricted social mobility. This is partly the reason why many have turned to retail with stocks or even more speculative assets such as cryptocurrencies.
The East Asian country, a great exporter, also desperately negotiates with the United States to reduce the tariffs imposed by President Donald Trump, including 25% car tariffs and 26% “mutual tariffs”.
When asked whether the uncertainty in the broader sense affects the trust of the individual Koreans, Lee points out the growth of Town’s advertising business last year, since the country’s economy is still strong.
And he remains in South Korea as an attractive market for anyone who wants to get in Fintech.
“Despite its limited population,” says Lee, “the Korean market is massive.”
The interview was run in collaboration with Fortune Korea.
This story was originally on Fortune.com