[비즈한국] ‘Zipdeco’, an interior design platform with a 12-year history, is ending its operations. The wave of closures among specialized interior design malls, which began last year, continues into this year. Wish Company, which acquired Zipdeco at the end of 2023, explained that the decision to wind down the business after just about a year was part of a "planned business strategy."
Wallets Closed by Recession: Home Furnishing Becomes a Luxury
The interior platform ‘Zipdeco’ will cease business after operating until March. Recently, Zipdeco posted a schedule for its service termination on its website. After ending services such as product ordering on March 31, the company plans to close its customer service center by the end of April.
Zipdeco is one of the representative online home furnishing malls. It gained popularity in 2014 by introducing DIY interior tips targeting single-person households and expanded its business by selling related home accessories and furniture. As of 2021, the number of members exceeded 3.1 million, and it had attracted 17.5 billion KRW in cumulative investment.
As interest in home interiors surged during the pandemic, fashion commerce company Brandy acquired Zipdeco as a 100% subsidiary in 2022. At the time, Zipdeco's corporate value was estimated at around 15 billion KRW. By the end of 2023, Wish Company, which operates the laundry service Laundrygo, became the new owner of Zipdeco. At the time of the acquisition, Wish Company explained that they "acquired Zipdeco to strengthen [their] commerce division" and that they would explore ways to collaborate between Laundrygo’s lifestyle goods commerce and Zipdeco.
However, Zipdeco’s performance continued to decline. Sales, which stood at 12.4 billion KRW in 2019, shrank to 4 billion KRW by 2022. In 2023, revenue dropped to the 870 million KRW range, with a net loss recorded at 780 million KRW. According to Mobile Index, a data platform company owned by IGAWorks, the number of app users for Zipdeco also dropped significantly. The monthly active users (MAU), which was around 61,000 in January 2024, fell to 48,000 in May and 36,660 in October. As of last month, Zipdeco’s monthly active users stood at approximately 28,300.
The interior industry enjoyed an unexpected boom during the pandemic as interest in the home increased, but with the end of the pandemic, the market's growth momentum began to buckle significantly. Since last year, long-standing interior-related platforms have been closing their doors one by one.
Last year, the online mall specializing in interior materials, ‘Moongori.com’, shut down its business. Started in 2002, Moongori.com grew into a leading interior material mall by gaining word-of-mouth popularity among DIY interior enthusiasts. In 2019, during the interior design boom, TY Holdings, the holding company of Taeyoung Group, acquired a 60% stake in Moongori.com for 15 billion KRW to make it a subsidiary, but the deficit expanded every year. Ultimately, in July of last year, TY Holdings announced that Moongori.com had been declared bankrupt by the Seoul Rehabilitation Court.
‘Allets’, an online shopping mall that sold interior lighting and furniture, also caused controversy by suddenly announcing the termination of its services and shutting down unexpectedly in August last year. August 16, the day the closure notice was posted, was supposed to be the interim settlement date for vendors, but it was reported that Allets had failed to pay some of them. The Fair Trade Commission estimated the amount of unpaid settlements by Allets to be 17 billion KRW.
‘Laundrygo’ Ends Zipdeco Business One Year After Acquisition
Wish Company explained that the decision to terminate the business just over a year after acquiring Zipdeco was part of its planned business strategy. A representative from Wish Company explained, "We achieved results such as securing commerce-related talent and product sourcing networks, and expanding customer touchpoints using Zipdeco's lifestyle media channels (Instagram, YouTube, etc.). As the core purpose of the acquisition was to secure essential assets for the growth of Laundrygo’s commerce rather than operating a separate app service, we decided to end the Zipdeco business as originally planned and concentrate the secured resources and capabilities on Laundrygo’s commerce."
Wish Company has been aggressively expanding its business through M&A since 2020. Jung Jun-mo, CFO of Wish Company, who attended the 'Discussion on Revitalizing Startup M&A for Corporate Innovation' held in July last year, emphasized, "We acquired Machine World to gain the know-how to build efficient laundry factories, and acquired Cryptex to obtain unmanned laundry shop operating solutions. If we had tried to create these systems and solutions from scratch, a lot of time and trial and error would have been inevitable. M&A can accelerate the speed of innovation and reduce risks."
Wish Company is making various attempts to discover new businesses to link with its laundry service. It is also exploring entry into the second-hand clothing market through 'Market In You', a vintage clothing shopping platform it acquired in 2023. The existing vintage clothing business relied on collecting and selling second-hand products to consumers, but Wish Company’s strategy is to add a laundry process to increase consumer satisfaction.
A Wish Company official stated, "We have already passed the break-even point (BEP) through a differentiated business model that combines laundry services with vintage clothing distribution. We plan to expand the premium vintage fashion market by strengthening synergy with Laundrygo. Our core strategy is to provide not only laundry services but also various lifestyle services associated with laundry. We will continue to expand related services such as commerce, second-hand clothing, and rentals."