The raised amount opens the doors for Toss to start plotting the big moves.
Viva Republica, the parent of the financial services platform Toss, lately announced that it has closed an $80 million funding round that values the firm at $1.2 billion. Toss, rolled out in 2015 as a peer-to-peer (P2P) payments service, has grown dramatically since.
With more than 25 services on offer, including loan accounts, credit score management, and customized insurance plans, Toss has over 10 million registered users in a country of 51 million people. SG Lee, CEO & Co-founder, Toss, estimated in early 2018 that by the year, 10% of all P2P online money transfers in Korea’s banking system will go through Toss, putting it at par with the country’s biggest banks.
Silicon Valley venture capital firms make debut in the Korean market.
The latest funding round was led by Kleiner Perkins and Ribbit Capital, both Silicon Valley venture capital firms making their debut in the Korean market.
Kleiner Perkins, known for its early bets on the likes of Google and Amazon, reckons there is a massive shift underway in consumer-facing financial services away from brick-and-mortar branch networks. Noah Knauf, General Partner, Kleiner Perkins, said, “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.”
NikolayKostov, a partner at Ribbit Capital, which is purely focused on the fintech industry and backs firms including digital currency exchange Coinbase, personal finance service Credit Karma and investing app Robinhood, stated, “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.”
Since regulations eased up around 2015, Toss has led the pack of upstarts that have attempted to disrupt Korea’s banking industry, aggressively taking on traditional incumbents. In the process, the company has raised nearly $200 million (including the latest round) from investors including Singapore’s GIC, Sequoia China and PayPal. In earlier 2018, Lee informed that he was looking to raise around $100 million in 2019.
About further Toss’ moves
Lee stated in an interview in October 2018, “By the end of next year, we are pretty sure we’ll be able to grab most of the Korean users who have a willingness to use fintech services. And at that point, we may hit the saturation point “So we’ll need to go beyond the Korean market.”
Reportedly, part of its cash will be funneled into powering Toss’s expansion within Korea, including a securities brokerage business. Moreover, there are also plans to expand into Southeast Asia, particularly Vietnam.
