Face masks can moisturize, exfoliate, or soothe and cool the skin in minutes. They can also build billion-dollar fortunes, but that takes a tad longer -- two years in Kim Jung-woong’s case.
With skincare becoming ever more central to the pursuit of beauty, a few Koreans have amassed fabulous wealth as more consumers are determined to achieve that elusive dewy look.
Banks and big cosmetics makers around the world have noticed.
In October, Goldman Sachs Group Inc. acquired 5 percent of Kim’s GP Club Co. Ltd. in a $67 million deal that values the maker of creams, lipstick and other beauty products at $1.3 billion. Kim, 44, and his family own the remaining 95 percent.
The investment bank told the company that it had been watching the cosmetics market with keen interest, Son Moon-ho, GP’s Club Chief Operating Officer at the time, said in an interview in January. Christopher Jun, a Goldman Sachs spokesman in Seoul, declined to comment. Son has since left the company.
In 2017, Unilever spent 2.27 billion euros ($2.6 billion) to acquire most of skincare products maker Carver Korea Co., buying out stakes held by Goldman, Bain Capital and founder Lee Sang-rok. Lee, 45, is worth $900 million, according to the Bloomberg Billionaires Index.
In October, Credit Suisse Group AG bought a roughly 3 percent stake in L&P Cosmetic Co., the maker of Mediheal mask sheets, for about 40 billion won ($35.6 million).
South Korea, a quarter the size of Japan, was the world’s sixth-largest cosmetics exporter in 2017, according to the Korea Trade-Investment Promotion Agency. The country logged $4.6 billion of exports for the first nine months of 2018, a 31 percent increase from the same period a year earlier, driven by demand from China.
Trade Tensions
Kim started his career in the beauty industry selling cosmetics to wholesalers in China and established his own brand, JM Solution, in 2016. It took off from the start, gaining popularity on Alibaba’s flagship e-commerce platform, Taobabo.
Then geopolitical tensions struck Korea’s beauty market.