In South Korea, there are about 7.3 million small and medium-sized enterprises (SMEs) — defined as firms with less than 250 employees. Their workforces combined make up 83.1% of all corporation employees in the country, totaling about 17.1 million people, according to OECD data.
To help meet SMEs’ financial needs in the country, Seoul-based fintech startup Korea Credit Data (KCD) said Thursday that it has raised $24.7 million in Series D extension financing.
Strategic investors — Fiserv, a Nasdaq-listed fintech company, and LG Uplus, a telco unit of LG Corporation — participated in the extension round. In total, KCD has raised about $70 million in its Series D round and about $112 million since its 2016 inception, said CEO of KCD Kelvin Dongho Kim.
The latest financing values the company at approximately $776 million (1.1 trillion KRW). KCD was valued at about $563 million in November last year when it raised $28.1 million in its Series D1.
The startup wants to address small merchants’ pain points by providing digital financial services, Kim told TechCrunch. In 2017, KCD launched its bookkeeping app for SMEs, called Cash Note, which helps small and mid-sized enterprise owners track a comprehensive overview of cash flow, including revenues, credit card sales and expenditure. The app also provides services like SMEs’ sales ledgers and policy information. It enables small business owners to connect with other entrepreneurs in their communities looking to scale their businesses.
Most small and mid-sized business owners with low credit records often struggle to secure working capital loans and survive tight cash flow, according to Kim. So the startup added SME-focused lending services to its platform, connecting SMEs entrepreneurs to access capital loan programs, Kim said.
KCD claims that it has more than 1.7 million registered merchants in South Korea and its app has grown into a super app among small and mid-sized business owners.
KCD has acquired South Korean startups, including ImU, a POS (point of sale) service provider, and Persona, a government subsidiary alert service for SMEs. The company plans to use its fresh capital to expand its team of 230 and make additional acquisitions.
Its previous backers include KB Kookmin Bank, KB Securities, GS Holdings, KT Investment, Pavilion Capital, Shinhan Card, Samsung Fire & Marine Insurance, Kakao and Kclavis.