Growth Finance and KTB Wave Also Bet on 'OneulSiktak', FI Investment Funds Likely to Disappear

‘Oneulhoe’ Operator Practically Defaults
Exit Strategies for VCs and Others Disrupted
Investment Fund Write-Down Confirmed

[Asia Economy Reporter Kwangho Lee] The fresh food delivery platform ‘Oneulhoe,’ operated by Oneulshiktak, which provides same-day seafood delivery services, has drawn market attention as it notified all employees of recommended layoffs and subsequently suspended its services. In particular, financial investors (FIs) such as venture capitalists (VCs) who have played a key role as growth catalysts for Oneulhoe have come under scrutiny.

Oneulshiktak is a seasonal seafood startup launched in 2017. CEO Jaehyun Kim, who worked as a marketer at a domestic company, modeled the company after the famous American grocery delivery service ‘Instacart.’ By planning, purchasing, and selling seasonal seafood products through Oneulhoe, the company established its presence in the e-commerce market.

Major VC Portfolios Including KDB Capital, KTB, Daesung Venture Capital... Cumulative Investment Amounting to 22 Billion KRW

Oneulshiktak laid the foundation for growth by securing an 800 million KRW Pre-Series A investment at the end of 2018. Subsequently, in August 2019, it successfully closed a 4 billion KRW Series A round. At that time, leading domestic venture capital firms such as Korea Investment Partners, KTB Network (now Daol Investment), and Daesung Venture Capital joined as FIs, elevating the startup’s profile.

Later, in early 2021, the company completed a 12 billion KRW Series B round. Existing investors Korea Investment Partners, Daol Investment, and Daesung Venture Capital participated in follow-up investments, while new investors including Hana Ventures, KT Investment, Gaia Ventures, Mirae Asset Venture Investment, and Mirae Asset Capital also joined.

The Series B round attracted particular attention. Not only major venture capitalists but also the policy institution Korea Growth Investment Corporation placed bets. The fact that a funding institution directly invested was evidence of high growth potential. This was why many investors wanted to participate in the deal.

An investment officer who reviewed Oneulshiktak’s investment at the time said, “It was impressive to see rapid growth by promoting ‘same-day delivery,’ which is even earlier than the dawn delivery service operated by ‘Market Kurly’ operator Kurly,” adding, “However, competition was fierce, so even though I wanted to join the club deal, I couldn’t.”

Following the Series B round last year, Oneulshiktak recently received additional investment. In July, existing shareholder Hana Ventures injected an additional 5 billion KRW, positioning itself as a strong ally. Despite the company’s valuation more than doubling compared to the Series B round, Hana Ventures boldly placed its bet. With cumulative investments exceeding 22 billion KRW, the company attracted industry attention.

Along with Hana Ventures, which invested recently, FIs that have made follow-up investments include Korea Investment Partners, Daol Investment, and Daesung Venture Capital. Together with CEO Jaehyun Kim, they hold significant shares. The problem is that Oneulshiktak’s sudden default declaration has blocked exit (investment recovery) routes.

FI Investment Write-downs Inevitable Upon Liquidation; Difficult to Claim Repayment Due to Lack of Retained Earnings

If Oneulshiktak closes and liquidates, FI investment write-downs will be unavoidable. Most FIs invested in Oneulshiktak through blind funds that can invest in multiple companies. Currently, the fund must write off the investment amount in Oneulshiktak. This will inevitably have a negative impact on management fees and performance fees generated from fund operations.

If Oneulshiktak holds assets, they can be distributed accordingly. However, due to the nature of the platform business, it is reported that the company does not have many assets. Moreover, the issue of unpaid payments to partner companies such as sashimi restaurants is ongoing, so creditors have priority. Since these creditors have not been paid, it is practically impossible for shareholders to receive their shares.

FIs typically invest in startups by purchasing redeemable convertible preferred stocks (RCPS) that grant redemption and conversion rights. Even if redemption rights exist, without retained earnings in the invested company, redemption claims cannot be made. In effect, there is no exit.

A venture capital representative said, “Even if there are assets, FIs inevitably become subordinated,” adding, “The situation is serious, and it seems there is no way to avoid losses.”

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