[People人] Leading Coupang's Quantum Leap with a New Business as the 'Second Rocket Delivery'

Kim Beom-seok, Chairman of Coupang Board, Details Plans for Nasdaq Listing

Beom-seok Kim, Chairman of the Board at Coupang

[Asia Economy Reporter Kim Cheol-hyun] On December 31, the day before the New Year, the atmosphere at e-commerce company Coupang was intense. A board meeting was held, and it was decided to change to a dual CEO system with Kang Hang-seung and Park Dae-jun. Kim Beom-seok, who had led Coupang since its founding in 2010, stepped down as CEO and took on the role of chairman of the board, which he held concurrently. Coupang stated that Chairman Kim would focus on setting the company’s strategic direction. They explained, "He plans to dedicate himself to devising strategies from a broader perspective and creating innovations that improve customers’ lives." Considering that Chairman Kim has consistently emphasized that Coupang’s mission is to make customers’ lives 100 times better than before, his role is focused on ‘strategizing from a broad perspective.’ The strategy envisioned by Chairman Kim, who led Coupang’s rapid growth, is already emerging at the speed of ‘Rocket Delivery’ at the start of the new year.

◆ Chairman Kim’s 10-year Dream: NASDAQ Listing = Industry insiders interpret Chairman Kim’s stepping down from frontline management as a move to focus on the goal of listing on the U.S. NASDAQ stock exchange. The increasing concreteness of Coupang’s NASDAQ listing plan in the new year supports this interpretation. Bloomberg reported on the 7th that at least six companies invested in by Japan’s SoftBank, including Coupang, are preparing for initial public offerings (IPOs) this year. It projected Coupang’s IPO timing in the second quarter and estimated the company’s valuation could exceed $30 billion, equivalent to about 32 trillion Korean won. Coupang recently passed the preliminary review for listing on the U.S. NASDAQ through its lead underwriter Goldman Sachs, and there are forecasts that it could be listed as early as March. Coupang has not commented on the listing but reiterated its existing stance that "there is no change in the plan to pursue an IPO at an appropriate time." However, the industry expects that Coupang’s NASDAQ listing schedule could become visible within the first half of this year.

If the NASDAQ listing happens this year, Chairman Kim’s decade-long dream will be realized. In August 2011, on the company’s first anniversary, he announced the goal of "directly listing on NASDAQ within two years." Although Coupang’s market position and business nature have changed significantly?from a social commerce company with a monthly transaction volume of about 30 billion won at that time to recording annual sales exceeding 7 trillion won in 2019?Chairman Kim’s efforts over ten years have ultimately reached the goal of NASDAQ listing.

◆ Seeking a Second ‘Rocket Delivery’ with New Businesses = "We will continue technological innovations that make customers’ lives remarkably easier until they say, ‘How did we live without Coupang?’" said Chairman Kim. This is why there is growing interest in the new businesses Coupang is pursuing. The industry is watching whether these new ventures can become another driving force for Coupang’s ‘quantum leap,’ like ‘Rocket Delivery.’ In 2014, Chairman Kim discontinued the existing social commerce business and introduced ‘Rocket Delivery,’ transforming Coupang into an e-commerce company. By directly purchasing products to guarantee quality and emphasizing fast delivery, customer satisfaction increased. This laid the foundation for evolving into the ‘Amazon of Korea.’ Chairman Kim’s bold move succeeded, with sales growing nearly 25 times from 300 billion won in 2014 over five years, achieving rapid growth.

Coupang is aggressively expanding its business areas beyond e-commerce to find new growth engines. The delivery app Coupang Eats quickly established itself in the market last year amid increased delivery demand driven by the COVID-19 pandemic. According to mobile index data from big data company IGAWorks, Coupang Eats had 1.855 million users in November last year, a tenfold increase compared to the same period the previous year. Even among leading companies like Baedal Minjok, there are internal talks of an "emergency situation."

Online video service (OTT) was officially launched at the end of last year. ‘Coupang Play’ allows Coupang Wow membership subscribers to enjoy unlimited popular movies, domestic and international TV series, and various video content anytime and anywhere without additional fees. With plans for original productions in the future, it is expected to have a significant impact on both the e-commerce and OTT industries. Coupang will also officially enter the live commerce market in January. ‘Coupang Live’ is expected to change the domestic live commerce market landscape, which is projected to expand to 8 trillion won in 2023, while creating synergy with the existing e-commerce business.

◆ Challenge of Improving Profitability = The reason Chairman Kim is focusing on Coupang’s NASDAQ listing and new businesses is to solve the accumulated deficit problem caused by continuous investments. Having secured $3 billion in investment from SoftBank Chairman Masayoshi Son, Chairman Kim has led Coupang’s growth but has not escaped losses. The deficit exceeded 1 trillion won in 2018 and recorded losses of around 700 billion won in 2019. Losses are also expected last year.

However, some in the securities industry foresee the possibility of Coupang turning profitable within a few years. Positive indicators include the estimated payment amount on Coupang increasing by 41% compared to 2019, reaching about 21.7 trillion won last year, driven by the expansion of non-face-to-face (untact) consumption due to COVID-19.

This content was produced with the assistance of AI translation services.