Six years ago, Korean brands were not well represented abroad, and the idea of a foreigner building a multi-million dollar business in Korea was unheard of.
But that didn’t stop Russian-born Roman Vernidub.
“I moved out to Korea as an exchange student in 2010,” Vernidub told me. “I learned the language and the culture. It was important to me to fit in.”
Vernidub’s first idea was to work in the Russian embassy or the United Nations. “I worked for a year in the UN’s Economic Commission for Asia,” Vernidub said. “I’ll be honest – it didn’t excite me.”
So in 2016, he created a business – Koru Pharmaceuticals – a trading company dealing with cosmetology and pharmaceutical products, where he acts as CEO and founder. He has since been nominated in Forbes Asia’s 30 Under 30 list.
“Koru started as a trading business between Korea and Russia, selling Korean products,” Vernidub said. “We focused on skin quality and beauty products for both men and women. You have to understand, skin quality and beauty are an obsession here. And it isn’t as female-centric as in other countries. It is common for men to advertise beauty products.”
Finding a Niche
In Korea, competition in this sector is incredibly high. There are thousands of brands. And while many of those products stay within the country, it’s hard to break into the industry in a significant way, even if you’re exporting.
“Our focus then shifted to cosmetics that focus on anti-aging and aesthetics,” Vernidub said. “Thread lifting, injectables, and other similar solutions.”
A thread lift is a non-surgical cosmetic procedure that lifts the skin of the face. It is designed for patients seeking subtle lifting, tightening, and smoothing of the skin but do not wish to undergo surgery. Users can pinpoint what style of lift they would like by choosing how many layers they want to tighten.
Injectables are soft tissue fillers, usually made from hyaluronic acid, injected into the skin to help fill in facial wrinkles and provide facial volume. Consumers can also use them to augment facial features, restoring a smoother appearance. Most of these wrinkle fillers are temporary because the body eventually absorbs them.
And demand for these kinds of services is high. Just in the Gangnam area, there are over 3,000 cosmetic surgeries.
“In Korea, you go to lunch and get a facelift, but people take a whole day off in the West,” Vernidub said.
Interestingly, the global pandemic actually aided Koru’s fortunes. You would have expected quite the opposite.
“During Covid, sales increased thanks to people having more free time, and ‘home-style’ clinics popped up everywhere,” Vernidub said.
The Next Phase
Starting as a distributor of Korean products, then focusing on a particular niche, has allowed Koru not only to succeed but do so at a rapid pace. The next stage is to develop its own products.
“Our research and development center opened two years ago,” Vernidub said. “We’re working on more than 40 different products now; Fillers, lypolitics, thread lifts, and anesthetics to help relieve any pain.”
Koru is also investing in its own factory for the future production of its products, which is remarkable given the company has grown organically to this point.
“We’ve bootstrapped our way to success and generated enough revenue to invest in R&D,” Vernidub said. “Now, we’ve put $2 million into a plot of land near Seoul and are preparing to build a factory, funded through self-investment and loans.”
The results? In 2020, Koru grew sales by over 100%. Its 2018 revenue was $7 million, and in 2019 it generated $14m in sales. It has distributed products to over 80 countries and employs 60 staff.
Timing, K-Pop, and Applying Western Attitudes
“The cosmetology industry in Korea was on the edge of explosion,” Vernidub said. “We were in the right place at the right time, and with our knowledge of Korean culture, combined with Western attitudes, we took the great potential apparent in this industry, packaged it beautifully for Europeans, and voila!”
Timing in other ways was also on Koru’s side.
“At the time, K-Pop was also taking off around the world, and that helped the Korean beauty market gain respect,” Vernidub said. “We gained from being early to market, as we were able to ensure the cost of the products to us was low, but we also gained from the growing popularity of K-culture.”
So what’s next for Koru?
“I think this industry is still snowballing,” Vernidub said. “I was scared last year when the COVID-19 pandemic started, but it gave a big push to the beauty industry. In the future, we want to invest more in our own production, and we will focus on products that are effective but without the need to go through actually plastic surgery. Ultimately, we’re planning on an IPO in the next two years, intending to reach $30m sales.”