WeMakePrice said on Tuesday that Wonder Holdings, its parent, attracted the investment from IMM Investment, a local private equity firm, in exchange for a 4.28 percent of its shares.
The announcement came after Nexon pledged to invest a total of 350 billion won in September. Of that, 250 billion won has been transferred to the start-up.
“We have brought in a total of 370 billion won of investment only for the second half of this year,” the company said in a statement.
“The funding has let the company claw its way out of the state of capital impairment and allow for investment for further expansion,” it said.
Impaired capital is a balance sheet condition where a company’s total capital becomes less than the face value of its capital stock.
The funds will be used mainly to strengthen sales channels.
“In essence, WeMakePrice is close to a retail company,” the spokesperson said,
“And the key to a retail company’s success comes from the competitiveness of the products it sells.”
He went on to note that the start-up will strengthen merchandisers and use the funding and attract more sellers, ranging from independent designers, shops and middlemen in a supply chain.
The e-commerce player has struggled to turn a profit in the face of cutthroat competition with rivals including Coupang, 11st and TMON.
“We will take the lead in the e-commerce market by swiftly injecting investment into the sectors in need of the funding,” said Park Eun-sang, head of WeMakePrice in a statement.
“We will make investments into partnered sellers to get an upper hand in price competition,” Park said.
WeMakePrice experienced a sales drop but managed to reduce losses.
In 2018, it generated 429.4 billion won in sales, down 9 percent. Its operating loss was 39 billion won, 6.4 percent lower than in 2017. The volume of transactions grew 28.6 percent to 5.4 trillion won in 2018.
BY PARK EUN-JEE [[email protected]]
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