[Herald Interview] Freshcode hits home run in Korean food delivery scene

South Korea has long been a haven for food delivery. Most of the time, food is delivered to your doorstep within 30 minutes of placing an order.

But professional food delivery businesses, such as Baedal Minjok have a downside. Although such services are popular, they are costly due to the number of deliverymen they need to employ. These expenses usually translate into higher retail prices.

Overcoming such issues related to cost and efficiency, Seoul-based salad delivery firm Freshcode has deployed what it calls a shared delivery system. It delivers to spots where there is more than a certain number of customers who have banded together to get salads delivered. The routes are navigated based on IT solutions. Last but not least, there is no extra delivery charge.

“We’re not a food company, we are an IT firm,” Regina Yoo, chief marketing officer and co-founder of the 3-year-old startup, told The Investor. “That is why we came up with the name Freshcode, a combination of fresh, as in eating fresh, and code, as in computer code.”

Freshcode Spots rule


The Korean startup sells salads based in a small kitchen from which it rolls out 1,300-2,000 boxes of salad a day. Last month, it won the grand prize at WeWork’s Creator Awards in Seoul, an award competition for startups, nonprofit organizations and artists.

Instead of running salad bars or restaurants, it has some 300 “Freshcode Spots,” where orders are delivered and picked up. Operating the Freshcode spots cost, surprisingly, nothing. The spots can be fridges at a company or a cafe. They can be created at the request of customers. Opening a Freshcode spot requires you to gather at least four others -- for example, your colleagues or like-minded people online -- and then simply place a request on the firm’s webpage. After a screening process, a brand new Freshcode Spot is born.

The ordering process is also quite easy, according to Yoo. Just locate the closest Freshcode Spot, choose a type of salad you want, place an order and then pick it up. Any order placed before 9:30 a.m. can be delivered to your pickup place before lunch time.

“From the get-go, we knew we wanted to develop our own website because that way, we can create a flexible ordering system that’s easier for customers to use and gives them more freedom than web portals like Naver or Cafe24,” the CMO said.

Freshcode is currently available in Seoul and nearby cities, like Suwon or Pangyo, but it will likely expand to other metropolitan cities in and out of South Korea.

“Since nearly 80 percent of the nation’s entire delivery services take place in Seoul and nearby cities, Freshcode is putting more focus on these regions,” said Yoo, who worked for startups in Seoul and San Francisco before founding the firm with CEO Jeong Yoo-seok in 2016.

“We would like to bring the same delivery business model to Busan or even New York,” she added.

‘Salad can be a filling meal’


Starting a salad business was not actually Yoo’s brainchild.

After burning out from previous jobs at startups, she had a chance to talk with venture fund Primer CEO Kwon Do-kyoon in San Francisco about her career path. Kwon, a self-proclaimed salad aficionado, recommended starting a salad business and introduced some of his favorite salad places in Golden Gate City.

Jung and Yoo, who have both never been trained in cooking, developed their signature recipes for salads and sauces through trial and error.

“Eating fresh and clean is a trend in Silicon Valley and San Francisco,” said Yoo, “I wanted to bring the culture to South Korea.”

During the Creator Awards event, in which some 700 for-profit startups competed for first place, one of the questions posed to Yoo onstage was if the CMO thinks a box of salad can be considered a substantial meal in the South Korean market, where rice is still a staple food.

The Freshcode co-founder said she believes salad is indeed a substantial meal that is both healthy and nutritious. “People used to doubt the success of drinks and food imported from outside Korea, such as Americano, pizza, and hamburgers, but consumers here love them now,” Yoo said.

The company started with around 100-200 customers and three Freshcode Spots when it launched in October 2016.

There are now 300 Freshcode Spots serving 30,000 people. Sales have also increased hundredfold in the same period, though the firm declined to reveal exact figures.

Growth has largely been driven by female customers, but the startup has seen an increasing number of male customers recently. Around 70 percent of its current customers are female while the rest are men.

“Men who are on a workout or diet scheme tend to try to eat healthy, so the company is trying to offer different types of salad tailored for them,” she said.

She forecast that the overall salad market here as well as abroad will continue to grow as people become more aware of what they eat. The Freshcode team aims to ramp up its daily production volume to 10,000 units this year while increasing the number of pickup spots to 1,200.

With the unique shared delivery business model, the company would be able to attain an upper hand in the sector, she said.

By Kim Young-won (wone0102@heraldcorp.com)