Meet Toss, South Korea’s very first fintech unicorn. According to Quartz, the financial platform’s parent company Viva Republica announced earlier this week that a recent $80M funding round, including investors such as Kleiner Perkins and Ribbit Capital, tipped Toss to a $1.2B valuation.
Toss founder, Lee Seung-gun, launched the peer-to-peer payments platform in 2015 after taking a detour from his earlier career as a dentist. After surviving pushback from Korea’s regulatory authorities, Toss took off as a huge player in this space.
According to Quartz, Kleiner Perkins’ investment philosophy reflects a belief that consumers are abandoning brick-and-mortar branch networks in droves, putting financial services at an inflection point.
“Toss’s emergence in South Korea is exemplary of this thesis, and we expect continued innovation from the company (and the fintech category as a whole) as new products/services allow consumers to gain control over their financial lives.”
“Toss’s emergence in South Korea is exemplary of this thesis, and we expect continued innovation from the company (and the fintech category as a whole) as new products/services allow consumers to gain control over their financial lives,” Noah Knauf, general partner at Kleiner Perkins, told Quartz.
South Korea is a prime proving ground for fintech, considering its near universal Internet access, smartphone market saturation and high per capita GDP. Until recently, the potential for fintech was hobbled by heavy financial regulations.
“With a large, youthful and incredibly tech-savvy population, the potential of Korea is enormous. Financial institutions in the country generate close to $500 billion in annual revenues almost entirely offline, and the advent of digital financial services is just getting started,” said Nikolay Kostov, a partner at Ribbit Capital. His fintech-focused firm has previous investments in Coinbase, Credit Karma and Robinhood among others.
Quartz says that Toss has raised nearly $200M in its bid to compete against Korean banking incumbents. The cash raised will fund expansion plans both within Korea and in Southeast Asia, particularly Vietnam.