알파경제 - Karrot Invests Heavily Overseas Despite Losses, Pursues Dual-Track Growth Strategy

[Alpha Biz= Paul Lee] Karrot, South Korea’s leading secondhand marketplace platform, has continued to invest hundreds of billions of won into its overseas operations despite mounting losses, signaling a strategic focus on global market expansion over short-term profitability.

According to industry sources on March 30, Karrot injected KRW 20.2 billion in cash into its Canadian subsidiary, Karrot Canada Corp., in January this year. The move came despite the subsidiary recording a net loss of KRW 37.5 billion last year. Notably, the investment follows Karrot’s first consolidated profit in 2024 and an expansion of operating profit to KRW 14.6 billion in 2025, suggesting the company is reinvesting earnings directly into overseas growth.

The strategy reflects the nature of secondhand marketplace platforms, where achieving a critical mass of users is essential to drive transaction activity and unlock scalability. Karrot appears willing to absorb early-stage losses to accelerate user adoption and market penetration.

Karrot currently operates its platform across North America and Japan through its Canadian and Japanese subsidiaries. In Canada, the service launched in Toronto and expanded nationwide in July last year, with further expansion into major U.S. cities such as New York and Chicago. In Japan, Karrot Japan Corp. operates in key regions including Tokyo and Yokohama.

The company’s continued investment in overseas markets underscores its view that growth potential abroad far exceeds that of its domestic market. In Korea, Karrot remains heavily reliant on advertising, which accounted for 99% of its revenue. Of its total revenue of KRW 270.6 billion last year, KRW 268.4 billion came from advertising.

Domestically, Karrot is pursuing business model diversification by enhancing its platform with artificial intelligence (AI). The company is developing technologies such as AI-based prediction models for successful secondhand transactions, improved search quality, anomaly detection systems for fraudulent activity, and retrieval-augmented generation (RAG) capabilities to boost platform efficiency.

Karrot’s R&D spending has steadily increased, reaching KRW 55.2 billion in 2025, up from KRW 37.5 billion in 2023 and KRW 47.2 billion in 2024. As of last year, R&D expenses accounted for 20.4% of total revenue.

The company has also made additional investments, including KRW 15 billion in Karrot Pay and KRW 300 million in Karrot Service (telemarketing services), further reinforcing its dual-track strategy of overseas expansion and domestic platform enhancement.

알파경제 Paul Lee 특파원(hoondork1977@alphabiz.co.kr)