At 23, Lee Su-jin cleaned rooms at a South Korean love hotel for a paycheck and a bed; the hotel review website he later turned into Yanolja was valued at $6.7 billion in 2021

Lee Su-jin was 23 when he started cleaning rooms at a love hotel in South Korea. This job provided him with a regular income and accommodation, which helped him meet his living needs after losing his parents at a young age, according to CNBC in 2019. Most of the work involved changing beds for couples who had paid for a couple of hours of privacy, Malay Mail reported in 2017. Yanolja, the application identified, raised $1.7 billion in funding from the Vision Fund 2 of SoftBank in 2021. StartupIntros recorded the post-money valuation at $6.7 billion, although some media outlets reported a higher figure. In between these two events, lies the crackdown by the law on South Korea's motel industry, along with Lee’s gamble with selling a motel as a bright room.A 2004 crackdown thinned out the motel tradeThe hotel industry in South Korea flourished in the late 1990s and early 2000s due to a large number of permits issued by the government after the 1988 Seoul Olympics, according to Korea JoongAng Daily. Love hotels were also involved in prostitution, which is a criminal activity in the country. A Reuters report from August 2015 on South Korea’s love hotels said a 2004 crackdown under then President Roh Moo-hyun put many of them out of business. A study in PLOS ONE, Effects of implementing the act of prohibition on sex trafficking on female sex workers’ sexually transmitted infections, dates the Act’s implementation to 2005 and describes how prostitution blocks became contested ground between police and workers while they were being demolished after the Act came into force in September 2004, according to AFP.Lee began with a review platform in 2005 and launched Yanolja Lee founded a hotel review website, although the exact founding year remains unclear because of the reported timeline conflict. It later became an advertising site where owners tried to lure customers, according to CNBC’s 2019 article. Yanolja evolved to become a booking site in 2007. The appeal he made to newly married couples and travellers was that staying in such hotels would be secure and economical. Bloomberg interviewed Lee, then 39, at his Gangnam office in 2017. Lee Su-jin told Bloomberg in 2017, “If all the motels relied on love, they’d starve to death.”A Hotelinn executive said modernised motels could double or triple revenueThe transformation that Lee was selling became apparent by 2015. The article in Reuters spoke about the transformation from dirty windows and red lights in bedrooms being replaced with clean rooms fit for family use. According to the 30-year-old student, with the surname Yang, speaking with the agency, the couple comes to short-stay hotels together up to 4 times a month and such hotels have become common places where couples go on dates. Lee Seung-rae, the CEO of HotelInn, the company that gives management lessons to the owners of motels, told the agency that owners get double and even triple their income when they modernise their properties. He also mentioned that small and medium motels cannot earn anything from the overnight stay.Demand had a practical side too. Reporting from The World, a PRX programme, says that in a country with a severe housing shortage, these motels increasingly give privacy to young adults who live with their parents.SoftBank invested $1.7 billionMoney came later. On 15 July 2021, the company confirmed that the Vision Fund 2 invested $1.7 billion. The fund acquired an approximately 25% stake, Korea JoongAng Daily reported. Roughly 1 trillion won was used to buy shares and another 1 trillion to acquire new shares. There are different valuation numbers for this financing round. StartupIntros states 6.7 billion, whereas Bloomberg's figure is above 10 trillion won (9 billion) based on people familiar with the matter. Yanolja did not disclose the valuation figure. As of July 2023, Forbes estimated Lee’s net worth at $1.2 billion, as reported by CNBC.You use AI every day. Now get your AI Quotient. Take the AIQ test.