"Now is the Right Moment for the Korean Market" — enableX Executive Officer Han on the Front Lines of Japan-Korea Cross-Border Business

2025.11.19

What kind of potential does the Korean market hold for Japanese companies? And how should the Japan expansion of Korean companies be supported? enableX Executive Officer Han, drawing on a deep understanding of both countries' business environments, speaks about cross-border opportunities and practical approaches.

Reading the Korean market "as it is now"

— First, please tell us about the current state of the Korean market.

Han: At first glance, the Korean market looks very strong. The KOSPI, Korea's stock index, has surpassed 4,000 points and has nearly doubled from a few years ago. Real estate prices have also surged — in the Gangnam area of Seoul, purchasing an apartment now requires 300 to 500 million yen.

While the external picture looks like a strong economy, youth unemployment is high and wages have stagnated. Out of this contradiction, an interesting consumption trend has emerged.

— What kind of trend?

Han: Real estate is too expensive for young people to buy a home. In Korea there is a culture in which the man prepares the home at the time of marriage, so being unable to buy a home leads to being unable to marry.

As a result, young people — unable to "invest in their future" — have started spending money on "the present self" instead. Consumption of luxury goods such as branded items and imported cars has accelerated. Even by global standards, Korea is growing as a luxury market with very high purchasing power.

Three opportunities in the B2C market

— For Japanese B2C companies specifically, what kind of opportunities are there?

Han: I see three broad domains. First is the luxury and premium-goods market. The shift in young people's consumption behavior I mentioned has driven up demand for relatively accessible luxury items priced at around one to two million yen.

Second is the inbound market. Korean tourists to Japan exceed 7 million per year, with an average of 2.37 trips — repeat visitors are very common. Strong purchasing power, multiple visits, and proximity that makes travel easy: this is an extremely attractive segment for Japan's inbound industry.

— Why are there so many repeat visitors?

Han: The Koreans in their 30s and 40s — the most affluent age group today — grew up with Japanese content from childhood. I'm part of that generation myself: in the 1990s, Takeshi Kitano's "Hana-bi" was the first Japanese film shown in Korea. Then came Shunji Iwai's "Love Letter," "Slam Dunk," "Dragon Ball," and other works — the generation for whom Japanese culture was a familiar presence is now the one with money.

That is why they come to Japan seeking experiences tied to Japanese content — visiting Super Nintendo World at USJ, watching the One Piece show, and so on.

— And the third opportunity?

Han: Japanese food culture. Korea, too, has rice as its staple and a culture of soy sauce and miso, so meals are very similar. In Korea, "omakase" is widely used to mean a course menu — that's how deeply Japanese food culture has taken root.

In fact, sushi chefs trained in Japan are increasingly opening their own shops in Korea, and the izakaya chain Toritetsu has entered Korea, positioned as premium dining. On top of that, the Japanese cosmetics brand SHIRO has opened a flagship store in Seoul's Seongsu area — Japanese B2C companies are becoming increasingly active in the Korean market.

The potential of the B2B market

— And what about for B2B companies?

Han: The B2B market also has enormous potential. There are three domains worth particular attention.

First is the content-production resource market. Korean designers and engineers have been active in Japan's game industry since the 2000s. At that time, labor costs were low and you could hire skilled designers, which is said to have supported the growth of game companies such as Cygames.

— Is that still the case today?

Han: The picture has shifted somewhat. Video production once outsourced to China and Vietnam is now moving — because of rising local labor costs and quality issues — toward the judgment that "if so, Korea, which offers guaranteed quality and is close, is a better fit."

In fact, Toho and Toei have set up production studios in Korea, and Sony Music has been running the Anime Game Festa in Korea for the past five or six years, with the next edition this December. The Japanese content industry views Korea as an important production hub.

— Please tell us about the other domains.

Han: Second is engineering resources. Services specializing in hiring Korean engineers, such as KOREC, have emerged, and Korean engineers have long been active in Japan's SI market. Third is the B2B SaaS market. This is a particularly compelling opportunity for Japanese startups.

Why B2B SaaS companies are targeting Korea

— Why is Korea attractive for SaaS companies?

Han: Japanese startups today are in a situation where institutional investors only come in for large IPOs. But not many companies can reach a valuation of 30 billion or 50 billion yen on the Japanese market alone.

That makes overseas expansion necessary — but in the U.S. the competition is too strong, and in Southeast Asia the B2B market itself has not yet taken off. Within this landscape, Korea is the realistic choice.

— Are there any specific success cases?

Han: For Datadog, I'm told that Korea is the market with the highest per-customer margin globally. That is because once a service is adopted by a chaebol-affiliated company, it spreads across the entire group.

Salesforce and Notion also have their highest growth markets globally in Korea. And among Japanese SaaS, I've heard that Jobcan is doing well in Korea.

— Why is SaaS growing in Korea now?

Han: The Korean B2B market is not yet mature, and the adoption of tools such as CRM and SFA is low. Sales in Korea has been relationship-based and has not yet been put on a scientific footing.

But as Generation Z rises, selling on relationships alone is becoming difficult. The environment is shifting to one where tools like SFA are needed. In fact, Channel Talk has reached annual recurring revenue (ARR) of 5 billion yen in SMB, and it is said that ARR of 10 billion yen is achievable if it scales into enterprise.

enableX's strengths and the form of support

— When a Japanese company considers entering Korea, what kind of support can enableX provide?

Han: Our strengths broadly come in three forms. First is the experience of launching Channel Talk. Among Korean startups, very few have succeeded in Japan, and Channel Talk is a representative case. Because of that, when Korean companies seek advice on entering Japan, many are referred to me through Channel Talk's network.

Second is our consulting background. "Brand" matters greatly in Korea, so the fact that enableX has many alumni from McKinsey is a major plus. Third is that we have an existing roster of major enterprise clients.

— What is the value from the Japanese side?

Han: For B2C companies, since most of Channel Talk's customers are B2C companies, we can leverage that network. From understanding market structure to matching with local partners to formulating marketing strategy — talent with hands-on experience in both countries is extremely rare, and that is our differentiator.

For B2B companies, we can provide local-partner discovery, event organization, implementation support, and other support grounded in an understanding of local business practices.

Supporting Korean companies' expansion into Japan

— Conversely, what is the situation with Korean companies entering Japan?

Han: The number of startups in Korea is about ten times that of Japan. Youth unemployment is high, and outside of the large conglomerates it is difficult to succeed — so people are pushed into entrepreneurship. But because the domestic market is small, overseas expansion becomes essential.

Japan is close, the political risk is small, and right now Japan-Korea relations are at their best in recent history. As a result, the number of Korean companies considering expansion into Japan is rising, and the Korean government is also actively providing subsidies.

— What kinds of companies are interested in the Japanese market?

Han: Among B2C companies, cosmetics startups are especially focused on Japan. APRILSKIN has reached a market capitalization close to one trillion yen, and Korean VCs are actively investing in cosmetics. Companies like d'Alba — which Shiseido benchmarks — are preparing to enter the Japanese market.

Among B2B companies, SaaS firms are paying attention to Japan's DX lag. Japan has a market characteristic in which, once adopted, a tool tends not to be discontinued — and this looks very attractive to Korean startups.

New developments: M&A and open innovation

— Please tell us about recent movements.

Han: In fact, demand from Korean companies to acquire Japanese companies has emerged. Recently, a Korean music-related company consulted us about wanting to acquire Japanese live-music venues, music festivals, and talent agencies.

I also recently spoke with an executive at a major Japanese cosmetics manufacturer, and he said they want to benchmark AMOREPACIFIC thoroughly. What is interesting is that AMOREPACIFIC is also paying close attention to that same Japanese major cosmetics manufacturer.

— So they are benchmarking each other?

Han: Exactly. For example, Korea's Hyundai commissions Nomura Research Institute every year to produce a research report on Toyota. Because we understand this mutual benchmarking relationship, we can connect both companies. That, I believe, is significant value.

In the context of open innovation, we can also bring together Korean cosmetics startups and host matching events with major Japanese companies — that kind of development is also possible.

Real estate as a new possibility

— Are there other areas you are focused on?

Han: In fact, I see real estate as the largest opportunity. As I mentioned earlier, in Korea real estate is too expensive to buy. By contrast, Japanese real estate is relatively affordable — and Koreans love real estate investment.

Recently I got a call from my cousin saying: "There are people around me interested in Japanese real estate — what do you think?" Interest is rising to that level. I believe it is important to build a track record before regulations come in.

The future of cross-border business

— Please tell us about the path ahead.

Han: I see Japan-Korea cross-border M&A growing for sure. The number of cases is in fact already trending upward.

For instance, there is a Korean startup that wants to acquire a Japanese confectionery factory. And Toyota Boshoku invested 20-30% in an SK-affiliated battery company in March of this year — investment for supply-chain stability, centered on manufacturing, is also becoming active.

— Finally, please share a message for the readers.

Han: The business environment between Japan and Korea is now in its best state ever. Interest in each other's markets is rising, and government support is generous. There is no reason to miss this moment.

What matters is understanding both countries' market characteristics and culture, and partnering with the right people. We at enableX, as a rare team with hands-on experience in both countries, are confident we can help our clients lead cross-border business to success.

Whether B2C or B2B, M&A or open innovation, I look forward to speaking with companies that want to maximize Japan-Korea business opportunities.

Profile: Han Kyung-Wook, Executive Officer, enableX, Inc.

• After joining Arthur D. Little Japan, engaged on assignments for a total of 15 clients across manufacturing, trading, logistics, and other industries
• From 2017, led the launch of the Japan business for a B2B SaaS startup
• From 2022, served as Japan representative for the Korean child-care brand Poled and realized the short-cycle launch of its Japan business
• From 2023, as a Venture Partner of Korea's largest VC, Atinum Investment, supported Japan operations for a fund of around 80 billion yen in size
• From 2024, launched the Korea-expansion support business for Japanese companies and has supported multiple companies' entries into Korea