South Korea has approximately 7.3 million small and medium-sized enterprises (SMEs), defined as companies with less than 250 employees. Together, these employees make up 83.1% of all company employees in the country, bringing the total to about 17.1 million, according to OECD data.
To meet the financial needs of South Korean SMEs, Seoul-based fintech startup Korea Credit Data (KCD) announced Thursday that it has raised $24.7 million in Series D extended financing.
Strategic investors — Fiserv, a Nasdaq-listed fintech company, and LG Uplus, the telecommunications arm of LG Corporation — participated in the extension round. In total, KCD has raised about $70 million in Series D rounds and about $112 million since its inception in 2016, said his CEO of KCD Kelvin Dongho Kim.
In its latest funding, the company is valued at around $776 million (1.1 trillion won). KCD was valued at around $563 million when it raised his $28.1 million in Series D1 last November.
The startup hopes to address the pain points of smaller merchants by offering digital financial services, Kim told TechCrunch. In 2017, KCD launched Cash Note, a bookkeeping app for small businesses. It helps small business owners track a comprehensive overview of cash flow including earnings, credit card sales, and expenses. The app also provides services such as SME sales ledger and policy information. It allows small business owners to connect with other entrepreneurs in their community looking to grow their business.
According to Kim, most small business owners with poor credit records often struggle to secure working loans and weather tight cash flows. That is why the startup has added small business-focused lending services to its platform, connecting small business entrepreneurs to access capital lending programs, Kim said.
According to KCD, there are over 1.7 million registered merchants in South Korea, and its app has grown into a super app among small business owners.
KCD has acquired South Korean start-ups including ImU, a point-of-sale (POS) service provider, and Persona, a government-owned alert service for small businesses. The company plans to use the new funding to expand his 230-person team and make additional acquisitions.
Previous backers include KB Kookmin Bank, KB Securities, GS Holdings, KT Investment, Pavilion Capital, Shinhan Card, Samsung Fire & Marine Insurance, Kakao and Kclavis.
