[Exclusive] Son Jeong-ui's 200 Billion Won Investment in 'Santa TOEIC' Riiid... Initiates Restructuring

AI Education Solution Startup Riiid
'Santa TOEIC' Operation, Corporate Value 1 Trillion Won
Raised 200 Billion Won Investment from SoftBank
Initiates Marketing Department Restructuring for Management Efficiency

Masayoshi Son, Chairman of SoftBank.

[Asia Economy Reporter Kwak Min-jae] It has been confirmed that Riiid, an AI education solution startup once dubbed the "second Coupang," in which SoftBank Chairman Masayoshi Son invested 200 billion KRW, has begun restructuring along with a management diagnosis.

According to industry sources on the 16th, Riiid recently started individual interviews with employees to offer voluntary retirement as part of management efficiency efforts. Since the company rapidly expanded after receiving about 200 billion KRW investment from SoftBank last year, it is known that they internally evaluated whether there were any unnecessary organizational functions. In particular, there was a consensus that the company had focused excessively on marketing at the expense of technology and services, so they plan to undertake a large-scale organizational restructuring to drastically reduce marketing functions.

However, Riiid's restructuring is considered unusual. In May last year, Riiid attracted significant market attention by securing a Series D investment of about 200 billion KRW from Vision Fund 2, led by Chairman Masayoshi Son. The cumulative investment amount raised from major investors such as the Korea Development Bank, IMM Investment, and DSC Investment reached approximately 284 billion KRW. The company's valuation is close to 1 trillion KRW, and although not disclosed, annual sales are reportedly in the hundreds of billions of KRW range.

Regarding this, Riiid CEO Jang Young-jun (pictured) said, "The recent company restructuring is a measure to streamline management while newly setting a business direction to refocus on technology and services." He added, "It is true that we are conducting many interviews with employees in roles that have become less important (for retirement), but this is unrelated to any liquidity issues."

Jang Young-jun, CEO of Riiid.

Earlier this year, Riiid was selected as one of "The World’s Most Innovative Companies 2022" by Fast Company, a U.S. technology and economy magazine. Fast Company is one of the world's most influential media outlets alongside Forbes and Time. Riiid was recognized for leading AI innovation in the education market transformed by the COVID-19 pandemic with its AI-based TOEIC education service "Riiid Tutor," widely known as "Santa TOEIC." This service diagnoses individual TOEIC skills and recommends customized educational content based on over 300 million learning behavior data points.

Currently, a "cold wind" is blowing through the startup industry. The venture investment market has frozen due to global interest rate hikes and economic downturns. Oneul Table, which operates the same-day seafood delivery service "Oneulhoe," notified all employees this month of recommended resignation due to failure to pay partner companies. Lifpick, a beauty and fitness reservation and payment platform, also closed in July due to worsening financial difficulties. As financial blockages deepen, startups lacking funds are consecutively shutting down or being put up for sale.

Meanwhile, Riiid is pushing forward with establishing a new corporation to relocate its headquarters to the United States. Riiid has selected Kim & Chang as its legal advisor and is preparing legal reviews and administrative procedures for the corporate transition.