Car-sharing startups in Korea continue to gain momentum as fuel prices continue to rise. As commuting in Korea becomes longer and more expensive, the ability to carpool without hassle helps commuters especially in Seoul save money as well as time. While the ride-sharing market is not as strong due to Korea’s strong taxi industry, it still has led to one startup becoming a startup unicorn. This shows there is immense business potential in this area for entrepreneurs and savvy startups in Korea. The article will feature both the Davids and the Goliaths of ridesharing in Korea to show a variety of innovative solutions that are currently being offered to commuters.
Top Car-Sharing Startups in Korea
SOCAR
Korean mobility startup SOCAR is one of the more eco-friendly car-sharing startups in Korea. In 2020, Socar gave a demonstration of its autonomous shuttle service using a modified Hyundai EV on the island of Jeju. The self-driving shuttle service carried customers from an airport in Jeju to the company’s rental car parking lot.
South Korea’s First Mobility Startup Unicorn
In 2018 SOCAR acquired a messenger app startup VCNC which operates the ride-sharing app Tada after getting a $42 million investment for their Series F round putting them as a Korean Startup Unicorn. Some of the investors of SOCAR included KB Investment, Stonebridge Ventures, Softbank Ventures, Altos Ventures, and Bain Capital to name a few. Therefore, so far their total funding to date at $250 million from four funding rounds. SOCAR’s post-money evaluation stands at $1.1 billion.
Their focus in 2022 will be on R&D and improving their mobility services through their platform. Therefore, they will look to improve their app’s user experience, support more payment options, add new modes of car sharing, and speed up the processing of license approvals for new users.
In addition, they will look to expand into the used car market as well as the proxy driver market. Proxy drivers are drivers who will drive your car for you when you are too drunk to drive yourself. Proxy drivers have been very popular in South Korea and they will look to create a platform for it much like how Kakao has.
“Socar and Tada aim to make their cars easier to move without having to own them. We will establish a foundation for a Korean mobility platform so that we can provide optimized mobility,” said Lee Jae-Woong, CEO of SOCAR.
Buxi
Korean mobility startup Buxi is an airport ridesharing service that ensures that travelers to Seoul will arrive and depart easily. When you land at Incheon International Airport you have only a couple of options. You can either have someone pick you up, take the subway, take the bus, or take a taxi. Now there is another option. Buxi passengers can input their desired pick-up location and time through the Buxi app which will then group them with other passengers. An average ride from Incheon to Seoul is around $20.
Their service transports people who are going in the same direction. Therefore by using Buxi, passengers will not lose much time. Buxi is great for family members visiting Seoul or coworkers coming to Seoul on a business trip. Up to five people can ride in one van.
Korean Logistics Firm Cariskukbo Acquires 37.55% Stake in Buxi
Buxi took steps to expand into the logistics industry with an investment from the logistics firm Cariskukbo. Cariskukbo will now have a 37.55% stake in Buxi. They will work together to drive innovation in supply chain logistics. Cariskukbo will look to use Buxi’s technology to develop an algorithm system that can calculate the best route possible based on real-time traffic data. Moreover, their goal is to work on boosting operational efficiency by saving time and costs. Buxi’s focus for 2024 will be to invest in big data and AI to be at the forefront of the mobility-as-a-service market.
Modoo Shuttle
Korean mobility startup Modoo Shuttle operates commuter buses for people in areas where public transportation systems are underdeveloped. Modoo Shuttle connects rental bus operators and drivers through its platform. Their platform also recommends the best shuttle routes when commuting to work. If their service does not go to a particular area just input your requests. The more requests Modoo Shuttle gets the faster their service will come to your area. Furthermore, they also offer services for private events.
TownCar
TownCar is a peer-to-peer car-sharing service that enables car owners to share their idled vehicles with neighbors living in the same apartment complex. The startup was granted a trial run under the government’s “regulatory sandbox” program that allows businesses to test their new service that is currently banned under existing rules. TownZ’s trial ends in 2024. After the trial, the Korean government will review the trial to see if there is a good opportunity to test the validity and feasibility of the car rental business.
