Lee So-hyung of SKIN1004: The Super-Rational Decision-Making Method (+Economics) of a McKinsey-Alum Founder Who Exited for 400 Billion Won

Craver Corporation, founded as Beatulink in the Chinese market in 2014, recorded 320 billion won in sales and 80 billion won in operating profit last year. SKIN1004 ranks among the top 7 skincare indie brands, and its online B2B platform, UMMA, is among the top 3.

The company achieved 10 billion won in annual sales in less than a year and 50 billion won in three years. However, when transactions with major Chinese platforms accounted for 80-90% of revenue, they faced a suspension of business, partly due to declining to offer hospitality. This ultimately led to the diversification of business partners, turning adversity into opportunity.

It's impossible to go against the tide of a massive market; quickly riding that wave is key to success. K-beauty follows a similar growth pattern in every country: initial slow growth, followed by a J-curve after a tipping point, and then another period of gradual growth.

The K-beauty J-curve consists of two phases: Phase 1 (supply shortage) and Phase 2 (marketing-driven). In Phase 1, demand grows rapidly but there are few genuine brands, allowing for growth simply by being present in the market. In Phase 2, numerous brands enter, and leadership shifts from distribution to marketing.

The decline of K-beauty in China wasn't caused by THAAD, but by a continuous drop in average customer spend, leading to decreased interest from distributors. We entered the market when others were exiting, successfully leveraging the structural opportunity of reduced advertising costs for K-beauty-focused influencers.

Brand success is a function of the product of 'good product × good marketing × good distribution.' It's multiplication, not addition, meaning if all three are excellent, it creates explosive synergy, but if even one factor is zero, the overall result becomes zero.

From the experience of multiple restructurings during challenging times for the company, I realized, 'I don't need to be the protagonist.' My role, I understood, was to motivate and empower talented individuals. I selected 10 projects and 10 leaders, focusing entirely on resource allocation.

Humanity is undergoing a 'jintta-fication' (introversion, delicateness, sensitivity), and Korea is significantly leading this trend. Skincare is an industry favored by delicate individuals, and I believe K-beauty will succeed by riding this powerful and unavoidable trend of human 'jintta-fication'.

During the exit, I stopped maximizing valuation midway, making the company moderately attractive to ensure I could choose the acquirer. Employees collectively received approximately 40-50 billion won, which I believe is by far the highest amount earned by employees in a beauty industry exit.

Initially, my goal was to be 'young & rich,' but as it became achievable, I realized the amount of money needed wasn't that significant. My goal shifted to 'I want to be respected.' I aspire to be seen by those I've worked with as trustworthy, rational, and generous.