Naver's luxury resale platform KREAM is continuing to post losses amid a slowdown in sales growth. Its valuation is estimated to have fallen below 1 trillion won, undercutting the unicorn threshold. With momentum for a once-discussed initial public offering weakening, and overall growth slowing across the online luxury platform market, questions are emerging about potential shifts in Naver's investment strategy.
◇ KREAM faces pressure on valuation amid weak profitability
According to the Financial Supervisory Service's Data Analysis, Retrieval and Transfer System (DART) on the 22nd, KREAM's sales last year were 202.5 billion won, up 14% from a year earlier. However, compared with the year-over-year sales growth rate of 166% in 2023 and 45.3% in 2024, the pace has slowed.
Profitability also worsened. Since its incorporation in 2021, KREAM has not generated an operating profit even once. Operating losses fell from 86.1 billion won in 2022 to 40.8 billion won in 2023, 8.9 billion won in 2024, and 8.1 billion won last year, narrowing the deficit.
Last year's net profit of 135.5 billion won is an accounting gain reflecting the fair value gain on redeemable convertible preferred shares (RCPS) liabilities and is unrelated to actual cash inflows. Analysts say this is a book gain arising as the liability valuation declined due to lower valuation of corporations, and it differs in nature from revenue generated through operations.
KREAM marked down the RCPS liability fair value from 552.2 billion won at the end of 2024 to 410.6 billion won last year. Because RCPS are structured to capture gains by converting to common shares if the value of corporations rises, a drop in fair value is interpreted as a sign that investors have lowered their expectations for future increases in the value of corporations or the possibility of an IPO.
Regarding this, a KREAM representative said, "RCPS fair value varies based on a range of accounting assumptions such as discount rates, volatility, and conversion probabilities," adding, "Some analyses note it is difficult to conclude this reflects a decline in the value of corporations."
Earlier, when it raised funding in 2024, KREAM was valued in the low 1 trillion won range and drew attention as the first unicorn among resale platforms. But based on the recent RCPS fair value, its valuation appears to have fallen to around 780 billion won. That is why some say it falls short of the unicorn threshold.
◇ Resale and luxury platforms restructure; BALAAN ultimately goes bankrupt
KREAM's slump goes beyond an individual corporations issue and is tied to a broader stagnation across online resale and luxury platforms. As post-pandemic spending on luxury goods and limited editions fell and the effects of high inflation mounted, the market has continued to contract.
SLDT, which operates Musinsa's resale platform "Soldout," posted a loss of 3.4 billion won last year (pre-merger basis). Musinsa moved to merge its loss-making subsidiary SLDT at the end of 2024. At the time, SLDT declared emergency management and was pursuing structural reforms.
The online luxury platform industry is also revealing structural limits. During COVID-19, restrictions on overseas travel and department store visits shifted spending to online luxury, driving rapid growth in a short period, but results deteriorated afterward due to a domestic downturn and intensifying competition among platforms.
BALAAN, considered a first-generation luxury platform, struggled with management woes and ultimately went bankrupt last month. BALAAN applied for corporate rehabilitation in March last year after delays in settling accounts with marketplace sellers, but it failed to secure funding and was pushed out of the market.
Alongside BALAAN, Must It and Trenbe—collectively dubbed "Meotbal"—are also having difficulty securing profitability. Must It has posted losses of around 10 billion won every year since 2021, and it recorded an operating loss of about 7.9 billion won in 2024. Trenbe reduced its operating loss last year from 3.1 billion won to the 700 million won range, but it still remained in the red.
Meanwhile, KREAM was discussed for a merger with U.S. resale platform StockX last year, but talks reportedly did not advance amid slowing growth. With the possibility raised of Naver selling its equity after establishing a joint venture (JV) with StockX, some expect KREAM could pursue a business restructuring or adjustments to its investment strategy.