Lee Seung-gun, also known as “SG” to those unfamiliar with Korean pronunciation, has a startup journey characterized by persistence, numerous setbacks, eventual success, and an interesting link to dental care.
The story began in 2011 when Lee transitioned from working at a Samsung-owned private hospital to founding Viva Republica. Reflecting on that period, Lee recounted that, like many Asian children whose parents encourage careers in neurosurgery or dentistry, he initially became a dentist. By the age of 29 or 30, however, he realized he wanted more than personal success as a dentist. To create a broader impact, he decided to focus on technology.
Embarking on an entrepreneurial path wasn’t easy for Lee. He invested 150 million won, roughly $105,000, of his savings into his venture. Over the first five years, he faced failure eight times with various “rubbish ideas,” including a social media platform and a voting app. According to a Bloomberg report, there was a point when Lee had only 20,000 won ($14) in his bank account and had to ask employees’ families to allow them to continue working without pay.
Eventually, Lee discovered a successful concept: a money transfer service known as Toss. What began as “another stupid idea” proved to be transformative because, as Lee put it, they had “nothing to lose” at that point. Today, Toss has grown into a comprehensive fintech “super app,” offering banking, insurance, stock trading, and money transfer services in one platform.
Given that South Koreans typically manage an average of five bank accounts and four credit cards, Toss’s popularity is likely due to its ability to simplify financial management. The company, now one of Korea’s most prominent startups, is valued at approximately $7 billion following a 2022 funding round, with major supporters such as GIC, PayPal, and Qualcomm Ventures. Lee himself became a billionaire, as per a 2021 estimate from Forbes.
The Toss platform claims close to 30 million registered users, about 60% of South Korea’s population, with over half of its 25 million monthly active users engaging with the app at least 10 times daily. Lee proudly notes that Toss’s active user base rivals that of Instagram in South Korea.
In Asia, where super-apps like Tencent’s WeChat offer a range of services from messaging to payments and more, finance has been a popular feature among emerging super-apps. Unlike in the West, where super-apps have not gained traction, Lee believes that Asian internet infrastructure, initially less developed, made super-apps more viable. Platforms like Toss had to integrate various services, as supportive companies didn’t exist in the region.
Viva Republica hit a significant milestone by achieving its first annual profit in the previous year since its inception over a decade ago. The company reported a net profit of 21.3 billion won ($15 million) for 2024, a stark contrast to the previous year’s 216.6 billion won ($152 million) loss. Revenue also increased by 43%, reaching 1.96 trillion won ($1.4 billion).
Lee attributes the profitability to a strategic focus on growing revenue over market share. He highlights that unlike other fintech companies, Toss’s revenue primarily comes from business customers rather than users. A significant portion of the company’s profits is also driven by strong growth in Toss Securities, its stock trading service, which uniquely charges users a fee and contributes about 20% of Toss’s overall revenue.
The company plans to go public “in the near future,” although specific details about timing and location remain undisclosed. Local reports suggest Viva Republica is contemplating a U.S. IPO, moving away from plans to list domestically due to concerns about valuation in the Korean equity market.
South Korean equities face challenges related to low valuations, often referred to as the “Korea Discount,” attributed to geopolitical risks and corporate governance issues among large conglomerates. Despite these challenges, Lee remains optimistic, noting the peaceful handling of recent political turmoil as a testimony to South Korea’s resilience. He emphasizes the need for economic growth priorities from both the business sector and politicians.
South Korea is addressing a sense of disillusionment among its youth, struggling with high debts and limited opportunities, which has led many to engage in retail stock trading and speculative assets. Despite these challenges, Lee sees South Korea as an attractive market for fintech innovation, asserting that the market’s potential is substantial despite the country’s limited population size.
This interview, conducted in collaboration with Fortune Korea, was originally published on Fortune.com.
