South Korea’s largest meal kit company Fresheasy is attracting close attention from the market with financial investors moving fast to secure the company’s stake due to its strong performance.

Financial investors are seeking investment opportunities in Fresheasy, according to sources on July 17. The private equity (PE) unit of South Korea’s Hana Financial Investment, Hana Financial Investment PE, which already invested in Fresheasy reportedly wants to make a new investment in the company. Previously Fresheasy received a combined 20 billion won ($16.6 million) from Korea Development Bank (KDB) and NAU IB Capital in March – 10 billion won from each.

Financial investors are seeing high growth potential in the company while interests in the meal kit market and demand for meal kits have soared after the outbreak of Covid-19. At the end of 2019, before the outbreak of the Covid-19, Korea Rural Economic Institute (KREI) expected the country’s meal kit market to grow to 700 billion won by 2024. However, the market is expected to grow faster than the KREI initially expected after the outbreak of Covid-19.

Founded in 2016, Fresheasy is a start-up which provides pre-packaged meals. Fresheasy’s revenue has shown an exponential growth in recent years. Its revenue recorded 71.1 billion won in 2019, up from 1.5 billion won in 2017 and 21.8 billion won in 2018. With the company’s revenue surging 47 times in just two years, financial investors have flocked to the company for investment opportunities. Fresheasy secured a total of 93 billion won in Series B and Series C rounds of funding last year.

The company received 26 billion won from Hana Financial Investment PE in February 2019, followed by 4 billion won from GS Home Shopping in March. It secured 50 billion won from nine investors including SoftBank Ventures Asia, NAU IB Capital, NongHyup Bank, NH Investment & Securities, SBI Investment, Union Investment Partners, Industrial Bank of Korea, Korea Investment & Securities and GS Home Shopping at the end of 2019.

The proceeds have been used to build its new plant and secure working capital. It has spent 45 billion won to build the new plant in Yongin, Gyeonggi-do province, last year to meet rapidly growing demands. The company has also been in need of working capital as it spent 6.6 billion won in shipping meal kits in 2019, up four times compared to a year earlier. Also, Fresheasy spent 4.3 billion won on advertising last year, up about 10 times compared to 2018.

“A number of financial investors are willing to make additional investments in Fresheasy, including Hana Financial Investment PE,” said an industry source. “Considering the company’s strong presence in the meal kit market, it will continue to attract attention from the financial market.” (Reporting by Se-hun Jo)