Kakao Mobility Corp. mulls to raise pre-IPO capital as it is being chased by investors for its promising business outlook leveraging on the Kakao chat platform almost every Korean uses daily.

According to multiple sources from the investment bank industry on Thursday, Kakao Mobility is said to be “seriously” considering pre-IPO fund-raising as its parent Kakao has been approached by multiple foreign institutions for investment.

Some institutions put Kakao Mobility’s value estimate at around 3 trillion won ($2.64 billion), which could make it a blockbuster IPO when it goes public in 2022.

The last time Kakao Mobility received outside funding was three years ago when it pulled in 500 billion won from Texas Pacific Group, Korea Investment Partners, and Japan’s Orix.

The fledgling company is yet to make money. The company raised 104.8 billion won in sales on a consolidated basis last year but logged an operating loss of 22.1 billion won. Sales almost doubled from a year ago but operating loss remained unchanged.

Still, the ride-arranging app has explosive potential of growth thanks to its market command through aggressive expansion.

In February 2018, Kakao Mobility acquired local carpool startup Luxi for 25.2 billion won and solved taxi supply issues. In August last year, it bought a number of local taxi companies including Jinhwa Taxi and Jungil Industry. The company has so far secured about 900 taxi licenses, a must to run platform-based taxi-hailing service under the country’s transportation law.

Market insiders expect that Kakao Mobility will continue to expand business. This year, the company added vehicle rental, travel, and advertisement businesses to its business portfolio, a move that is seen as part of its efforts to link various services to its customer platform of Kakao T that has up to 26 million subscribers.

The market is also interested in Kakao Mobility’s data from its designated driver service as more than 50 million records over the past four years could be a reference in developing customer-focused and new services.

By Kang Woo-seok and Lee Eun-joo

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