SEOUL (Reuters) - SoftBank’s Vision Fund is investing an additional $2 billion in South Korea’s top e-commerce firm Coupang, the retailer said on Tuesday, as the loss-making startup seeks to cement its market dominance.

Delivery trucks for e-commerce retailer Coupang leave a distribution centre in Seoul, South Korea, June 21, 2018. REUTERS/Josh Smith

The latest investment follows the $1 billion that SoftBank invested in Coupang in 2015 and values the eight-year-old startup at around $9 billion, a source close to Coupang said.

Coupang has since grown rapidly to become the biggest player in South Korea’s e-commerce market. It clocked 2.7 trillion won ($2.4 billion) in revenue last year, with its online sales almost as much as the next three largest e-commerce sites in the country combined, according to research firm Statista.

However, it has also suffered large losses, totaling 1.9 trillion won over the past five years, as it poured money into building new technology and its logistics infrastructure.

“The $2 billion we are receiving now is exciting, because we can invest in more technology platforms that enable this innovation,” Coupang founder and chief executive Bom Kim told Reuters.

In the race to differentiate itself in a market crowded with delivery companies and big conglomerates, Coupang has moved beyond being just a website and a collection of warehouses and built up a huge delivery network.

It also made a splash with its ‘Rocket Delivery’ service that promises delivery within 24 hours, as well as the more recent ‘Dawn Delivery’ service.

“The reason we were able to do that in such a short period of time is because of that technology investment we made over the years,” Kim said, noting that the new capital will be aimed at expanding Coupang’s investment in technology.

Coupang says its revenue has doubled in the past year and is now approaching $5 billion in 2018.

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But in incurring losses from building up a large infrastructure and workforce, Coupang has faced questions about whether it can fend off challenges from more established bricks-and-mortar players like E-Mart and Lotte.

Reflecting the ballooning losses, SoftBank’s previous $1 billion investment was marked down by 30 percent to $700 million when the Japanese group transferred its Coupang stake to the Vision Fund this year.

“(Coupang) as it was situated prior to this decision to put more capital in, was fundamentally offering the best e-commerce experience anywhere in the world,” Lydia Jett, partner at SoftBank Investment Advisers and a Coupang board member, told Reuters in an interview on Tuesday.

For SoftBank and its $98 billion Vision Fund, Coupang marks another significant investment in a loss-making startup, as they seek to put a huge pool of capital to work and earn an attractive enough return.

SoftBank is also injecting an additional $3 billion in loss-making U.S. shared office space provider WeWork Cos, Reuters reported earlier this month.

“Coupang is becoming significantly more efficient than when we made our first investment and has a clear path to profitability,” Jett said. “And we understand that this company will be profitable in the near term in core business.”

While Coupang had been considering 2019 for an initial public offering, this new round of financing makes that a more long-term goal, Jett said.

“It’s still on the roadmap, but I think there is still a lot of room to continue to expand the value proposition for the customers before we do that,” she said.

With strong technological and mobile adoption, South Korea is one of the biggest and fastest-growing e-commerce markets worldwide.

Its retail e-commerce volume will grow to $32.6 billion by 2021 from $19 billion in 2016, Statista research said.

In January, E-Mart and its parent company Shinsegae announced a preliminary deal to use an expected $940 million investment from private equity firms to expand their online offerings.