[비즈한국] As Bungaejangter pushes for the sale of its management rights, the company is attracting market attention with a valuation of around 750 billion won. Although it has suffered from chronic deficits, the stabilization of its profit structure through the introduction of transaction fees is cited as a key factor in its revaluation. However, some analysts suggest that while this fee system boosts profitability, it could act as a burden on long-term growth by discouraging the influx of individual sellers.
Bungae Pay's 'Double-Edged Sword': Profitability Improvement vs. Seller Exodus
Used goods platform Bungaejangter has initiated the sale of its management rights. According to the investment banking (IB) industry, the largest shareholder, Praxis Capital Partners (Praxis), recently selected Citi Securities as the lead manager for the sale and is currently conducting market demand surveys to identify potential buyers. The asking price suggested by Praxis is reportedly around 750 billion won. Compared to its valuation at the time of acquisition in 2020 (approximately 150 billion won), its value has increased fivefold in six years. The market believes that if this deal goes through, Praxis will achieve a significant return on its investment.
Bungaejangter’s greatest weakness had been its "chronic deficits." Although transaction volume increased, the lack of a clear profit model caused operating losses to swell to the 39 billion won range by 2022. While it attempted to improve its financial structure in 2023 by cutting fixed costs and streamlining the organization, it still recorded an operating loss of 21.6 billion won.
The turning point was 2024. Starting in August 2024, Bungaejangter made it mandatory for all transactions to be conducted through its secure payment service, "Bungae Pay." In effect, this introduced a fee system to its used goods trading. It began charging sellers a 3.5% fee, and last year, it increased the commission rate to 6%.
There was significant backlash from users during the implementation of these fees. Signs of users leaving the platform were detected among some heavy users. However, as payment fees became a core revenue source, performance improved. Revenue, which was 34.1 billion won in 2023, grew by approximately 31% to 44.8 billion won in 2024, and the operating loss narrowed from 21.6 billion won to 19.5 billion won.
Although the deficit structure continues, the industry perceives the move as meaningful in that the direction of its profit model has become clear. An industry official said, "The time immediately after a platform proves it can actually generate profit is a good point to receive a high valuation," adding, "They likely determined that now is the appropriate timing to pursue an exit."
Focus on Participation of Conglomerates… Will it be a Variable in Competition with Karrot?
Attention is also focused on the moves of existing investors BlueRun Ventures (BRV) and Shinsegae004170 Group's CVC, Signite Partners, regarding this sale. As they hold the right of first refusal, the possibility of them pursuing a direct acquisition is being discussed. BlueRun Ventures is an investment firm led by CEO Yun Kwan, the son-in-law of the LG family. Signite Partners is Shinsegae's corporate venture capital (CVC), which has focused on investing in startups that can create synergy with the group's distribution and retail businesses.
If a conglomerate-affiliated investment firm takes over, it is expected that Bungaejangter could accelerate the sophistication of its services based on capital power and networks. This is why there are expectations in some parts of the market that it could act as a variable to shake up Karrot's (Danggeun) dominant position.
However, experts remain cautious. The analysis is that it will not be easy to overcome the network effect of the hyper-local ecosystem built by Karrot in the short term. The biggest hurdle cited is that the "fee" system, which was the primary driver of Bungaejangter's growth, could paradoxically restrict the influx of users.
Lee Jong-woo, a professor of business administration at Ajou University, pointed out, "The core of platform competitiveness depends on how many 'sellers' you can secure. Unlike Karrot, which is free of commission, Bungaejangter is inevitably less attractive to individual sellers. Because of this, Bungaejangter has changed into a platform centered on professional dealers. If the dealer-centered structure is strengthened, there may be limits in terms of long-term growth potential."
Karrot has rapidly secured its user base through a "region-based local community" expansion strategy. Beyond used goods trading, it has established itself as a platform that connects local activities such as neighborhood life information, job searches, part-time jobs, and real estate. Based on this user base, it has made advertising its core revenue source.
The advertising-based model has the advantage of generating profit without directly intervening in user transactions. Although Karrot continued to see deficits until 2023, it succeeded in turning a profit in 2024. It is expected to achieve a profit for the second consecutive year, as it has maintained a surplus as of the third quarter cumulative period last year.
A Karrot official stated, "Karrot is generating stable profits. The performance up to the third quarter of 2025 has already exceeded the full-year performance of 2024," adding, "We view this as a result that proves the great potential of the local advertising business that Karrot has focused on."
The industry suggests that Bungaejangter needs to find strategies to expand its user base and increase the platform's appeal beyond a fee-centered structure. Analysis suggests that finding a balance between profitability and user expansion will be the key to future growth. With these challenges ahead, attention is focused on how attractive Bungaejangter will be evaluated as an asset in the market.
A Bungaejangter representative stated, "There is no party with whom we are engaged in full-scale sale discussions," adding, "It is true that we are receiving market interest due to good performance, but nothing has been confirmed yet."