Kim Beom-soo, the founder of Kakao, the Korean version of wechat, resigned from the board amid allegations of tax evasion and antitrust pressure

2022-05-11 0 By

Kakao Group, South Korea’s answer to wechat, announced on Monday that its founder, Kim Beom-soo, had stepped down from the company’s board and handed over control.The move comes after a series of scandals rocked the South Korean social media and fintech giant, sparking a backlash.Mr. Kim will now focus on global expansion, the company said in a statement.Shares in several Kakao Group subsidiaries plunged in January amid reports that south Korean police were investigating tax evasion allegations against Mr Kim.Kim beom-soo is alleged to have evaded 886 billion won ($743m) in taxes during the 2014 merger of Kakao and Daum, according to charges brought by a civic group.Kakao denied the allegations as “baseless”, adding that the merger had shareholders’ approval.Kim Beom-soo briefly overtook Lee Jae-yong, Samsung’s de facto head, to become South Korea’s richest man last July, an example of a self-made tech entrepreneur overtaking members of the chaebol families that have controlled the country for decades.But after the south Korean government began cracking down on the Internet giants’ monopolies, the company’s shares fell.Kim beom-soo, 56, grew up poor and once shared a room with seven family members.He was the first of his siblings to go to college, studying at Seoul National University and working as a tutor to pay for his education.Kim founded Iwilab, the predecessor of Kakao, in 2006 and launched KakaoTalk four years later.Kakao’s business now extends far beyond mobile messaging to include payments, banking, gaming and ride-hailing.It is now South Korea’s fourth-largest listed company, with a market capitalisation of about $58bn.In less than two years, Kakao has listed three units — Kakao Games, KakaoBank and Kakao Pay — with Kakao Pay rising more than 150 per cent on its first day of trading in November, making it one of the hottest ipos of 2021.The group is reportedly preparing to list its ride-hailing service Kakao Mobility and has selected a partner bank.But Kakao’s rapid growth has brought it under increasing regulatory scrutiny and criticism for threatening its market dominance to small merchants.Last September, Kim Beom-soo pledged won300bn to help small businesses and said he would consider eliminating competing services such as flower delivery.This article is from the financial community