The Collapse of Luxury Platforms Triggered by Balaan's Bankruptcy... 'jente' Standing on the Edge of a Cliff

The End of Revenge Spending, the Bitter Collapse of First-Generation Luxury Platforms

The online luxury platform market, which grew explosively riding the so-called 'revenge spending' craze during the COVID-19 pandemic, is facing a bitter winter. Following the transition to an endemic phase, luxury demand has plummeted due to overlapping high inflation and domestic economic stagnation, driving platforms that had engaged in cutthroat competition into severe restructuring phases.

The most symbolic event showing the industry's crisis is the bankruptcy of the luxury platform 'Balaan'. Although there were bankruptcies of companies like Smile Ventures, which operated Catch Fashion, before Balaan, the rehabilitation and bankruptcy of Balaan was a much more shocking event for consumers. Balaan, a first-generation platform that was once valued at 300 billion won and eyed unicorn status, failed to overcome a liquidity crunch amidst unreasonable outward expansion, causing delays in settlements for registered sellers, and was ultimately declared bankrupt by the Seoul Rehabilitation Court, making a lonely exit from the market.

The situations of Mustit and Trenbe, which were known as the first-generation troika alongside Balaan, are also bleak. They, too, have been unable to escape the quagmire of deficits for five consecutive years. Mustit, unable to withstand accumulated losses and worsening liquidity, sold its headquarters in Sinsa-dong, Gangnam-gu, and downsized by relocating its headquarters to a shared office near Dosan-daero, while Trenbe is also struggling as its sales were halved last year. Experts analyze that since the luxury commerce market is a highly concentrated market based on CR3 (the market share of the top three companies), the bankruptcy and management difficulties of top vendors are spreading consumer distrust across the entire luxury e-commerce ecosystem.

The Shadow of 'Capital Impairment' Hidden Behind jente's Spectacular Outward Growth

The third-generation luxury platform 'jente', which rapidly emerged as the industry leader by gaining reflective benefits amid the collapse of first-generation platforms, is also facing a severe financial crisis, contrary to its outward appearance. Founded in 2020 by CEO Jung Seung-tan (64% stake) with just over 100 million won in capital, jente put forward a '100% direct sourcing' model, directly contracting and sourcing products from over 330 local boutiques in Europe, including Italy and France. Through this, the company achieved remarkable outward growth of nearly 30-fold in just four years, boosting sales from 1.8 billion won in 2020 to 48.8 billion won in 2023 and 53.7 billion won in 2024.

Armed with this growth trend, jente attracted a 9 billion won Series A investment at an estimated corporate valuation of 45 billion won in 2022 from InterVest, KB Investment, Yuanta Investment, and others, followed by an additional investment of 2.3 billion won from Dongmoon Partners and others in 2023.

However, its underlying financial condition has already festered and burst. The direct sourcing structure intended to eliminate intermediate margins inevitably brought about massive inventory burdens and increased fixed logistics costs, which directly led to consecutive billions of won in operating losses: 900 million won in 2021, 1.4 billion won in 2022, 5.3 billion won in 2023, and 5.2 billion won in 2024. As a result, jente's total equity as of 2024 was merely 194.62 million won, which is less than its capital stock, pushing it into a state of partial capital impairment.

Ultimately, its external auditor, Hoyeon Accounting Corp., warned through the 2024 audit report that there is significant uncertainty regarding jente's ability to continue as a going concern. Hoyeon Accounting Corp. directly pointed out jente's liquidity crisis, stating, "As current liabilities exceed current assets by 23.9 billion won, the company is exposed to liquidity risk."

Depleted Cash Assets, Even the Last Bastion of 'Selling the Headquarters' is Shaken

What is currently suffocating jente the most is the severe depletion of operating funds. Current liabilities amount to approximately 39.6 billion won, but the cash and cash equivalents held by jente are merely around 700 million won. In particular, most of its current assets (approximately 15.7 billion won) are tied up as inventory, leaving an absolute shortage of immediately available cash assets. Accounts payable also skyrocketed nearly 20-fold from about 800 million won in 2023 to around 15 billion won in 2024, effectively reaching a critical limit in service operations.

Driven to the edge of a cliff, jente put its headquarters (jente Building) located in Sinsa-dong, Gangnam-gu, Seoul up for sale at 23 billion to 25 billion won as a last lifeline. However, as the freeze in the commercial real estate market coincides with high-interest-rate trends, the company has been unable to find a buyer for over half a year. A more serious problem is that jente's total debt is approaching 40 billion won (including 39.6 billion won in current liabilities), and the building already has a 19.2 billion won loan from Kookmin Bank attached to it, meaning that even if the building is sold at cost, the actual cash the company can secure is at most around 6 billion won. This is why skepticism prevails that selling the headquarters alone will not immediately lead to financial stabilization.

As investment sentiment in the venture capital (VC) industry has frozen following the 'Balaan incident', even the Series B round of investment attraction that jente had been pursuing is essentially postponed indefinitely or suspended.

Plummeting Employee Numbers and Service Collapse... A Crisis Spreading to Consumer Damage

As cash dries up, internal cracks within the company are also accelerating. As a desperate measure for survival, jente enforced intense workforce restructuring, including C-level executives. The number of employees, which was maintained at 82 in 2025, plummeted to 30 as of January 2026, less than a year later.

The severe shortage of operating funds and the drastic drop in the number of employees are directly leading to a decline in service quality, generating damage to consumers in its entirety. Recently, in online communities, appeals and complaints from consumers who used jente have been pouring in, saying, "It has been over a month since I purchased the product, but it only shows 'preparing for delivery'," "The customer center is completely unresponsive, so I can't even get in touch," and "Refunds are being delayed."

On top of this, even the marketing of 'fundamentally blocking counterfeit goods through 100% direct sourcing from boutiques', which jente touted as its biggest point of differentiation, has been put on the chopping block. Following a recent incident where Prada sunglasses sold on jente were caught as counterfeits and refunded, even Canada Goose padded jackets have been engulfed in controversy over suspected counterfeits, inflicting a fatal blow to brand reliability.

Industry insiders say that the series of processes leading to delivery delays, refund delays, loss of contact with the customer center, and massive workforce departures looks similar to the precursor symptoms Balaan showed right before it entered corporate rehabilitation proceedings and went bankrupt. Amid failed investment attraction and snowballing debts, concerns are growing that if jente fails to find a fundamental solution, a 'second Balaan incident' could become a reality before long, bringing another massive wave of impact to the industry.