K-Beauty startups raised $4.9 million in the first four months of 2025, showing signs of recovery after a slow year in 2024, according to Tracxn.
Tracxn said that the K-Beauty industry has received a total of $453 million in funding.
The K-Beauty industry saw its biggest funding years in 2016 and 2018, raising $186 million and $148 million.
But the last few years have been tough for the K-Beauty sector. In 2024, funding dropped to just $975,000—the lowest in 10 years and a big 90% drop from the $10 million raised in 2023.
The statement said the K-Beauty industry is backed by a strong network of over 1,100 companies worldwide.
An internal study found that 74 K-Beauty startups have received funding so far. South Korea leads the way, with the most companies and funding.
South Korean startups account for over 55 percent of the total funding in the sector.
The worldwide popularity of K-Beauty is due to its high-quality products, natural ingredients, and innovative formulas.
It’s also been boosted by the massive influence of Korean pop culture, including K-pop, K-dramas, and social media.
It’s been noted that early-stage funding has been the main source of financial support for the industry in recent years.
Early-stage funding has been the main driver of investment in the past five years, making up 27.8% of all funding.
It’s important to note that all the funding raised in 2022 ($12 million), 2023 ($10 million), and so far in 2025 ($4.9 million) came from early-stage investments.
On the other hand, late-stage funding has raised a total of $311 million so far, which makes up 69% of the industry’s total budget. However, there has been no new late-stage funding in the last five years.
Seed-stage funding has reached $15.3 million, with $957,000 raised in 2024. However, no seed deals have been closed in 2025 so far.
South Korea leads the K-Beauty industry with $250 million in funding, followed by the United States with $199 million, and India with $4 million.
Among the top companies in the K-Beauty industry, Memebox is the highest-funded startup, with $193 million raised. It’s followed by GP Club with $67.5 million and Clio Professional with $50.1 million.
The segments that have received the most funding are Color Cosmetics, Multi-Category K-Beauty, and Skincare K-Beauty.
Color Cosmetics brands have raised $245 million, with the highest funding in 2016 at $177 million.
Multi-Category K-Beauty companies have raised a total of $77 million, with $4.9 million of that coming in 2025 so far.
Skincare K-Beauty companies have raised $46.5 million, with the biggest funding in 2018 at $33 million.
“K-Beauty’s global footprint is expanding as consumers seek ethical, high-performing products rooted in innovation,
“With early-stage investments driving the sector’s revival, we expect K-Beauty brands to play a pivotal role in shaping the future of the global beauty industry,” said Neha Singh, Co-founder and Chief Executive Officer of Tracxn.
The statement says that the K-Beauty startup industry has seen 12 mergers and acquisitions (M&As).
In 2025, Manyo, a natural skincare brand, was bought by Klpartners for $129 million. Another significant acquisition was in 2022 when LG Household & Healthcare acquired The Crème Shop for $120 million.
The K-Beauty industry has created two unicorn companies so far. GP Club was valued at $1.3 billion in 2019, and Mediheal, which makes facial care products, became a unicorn in 2017.
So far, 18 K-Beauty startups have gone public. In 2024, APR was the only company to launch an IPO (Initial Public Offering).
Investor interest in K-Beauty has stayed strong, with Goodwater Capital, Pear VC, and Altos Ventures Management being the top investors in the industry.
Over the past two years, the top investors in the seed stage have been 500 Global, Barlon Capital, and Blueprint. For early-stage funding, khfamily.kr, Company K Partners and SmileGate Investment have been active in the last two years.
As global interest in Korean beauty products stays strong, Tracxn believes the K-Beauty industry is ready for a new growth phase, thanks to its strong support system and growing popularity worldwide.
As K-Beauty keeps bringing out new ideas and inspiring trends, it remains one of the most exciting parts of the global beauty industry, according to the report.
The report noted that venture capital firms worldwide have become more cautious because of significant issues like inflation, global conflicts, and supply chain problems. As a result, funding in many industries has gone down.
Even so, it showed that K-Beauty brands have a lot of potential because they focus on new ideas, science, and being eco-friendly.
As consumer demand for ethical and high-quality products rises and K-Beauty scales globally, VC interest in the sector is expected to grow,
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