FEATURE: Startup hub taps Seoul’s advantages
SEOUL (China Daily/ANN) - South Korean government-backed incubator fosters entrepreneurship for innovators under one roof, collaborates with private partners
As the largest startup incubator in South Korea, Seoul Startup Hub is ready to foster entrepreneurship for foreign and local innovators through its all-in-one platform.
Since its launch in June last year, the government-backed hub has fostered 751 startups, including 10 global startups, said the center’s director Moon Kyong-il. It has achieved sales of 22.2 billion won (US$20 million) while attracting investment of 20.2 billion won.
Located in Gongdeok-dong, a neighborhood of the Mapo district, the Seoul Startup Hub consists of a 10-floor main building and a four-floor annex building. Apart from business space and supportive facilities for startups, it also has public areas for citizens to share the space and see how the startups operate.
Any startup with less than seven years of experience can apply for an office in the hub without having to pay rent. Only a small administration fee will be sought, said Moon, adding that the center strengthens the startup ecosystem through collaboration with private professional partners, including global incubators, investors, law and accounting service providers, and patent advisories.
“There are many small startup centers in Seoul that provide a more targeted approach to meet the diverse needs of entrepreneurs. For example, some may be more focused on female-entrepreneur-oriented or financial services,” said Moon.
“So it is important for the Seoul Startup Hub to lead and connect all of them, in order to better serve the startups in a more synergized way.”
Among the hub’s goals are to double the number of startup-supporting centers from 43 at present to 90 by 2022, and to provide customized support to 1,600 startups each year, said Moon.
South Korea has the highest government backing per capita for startups, according to Forbes. The government established a US$9 billion venture fund last year as part of efforts to support startups, in addition to its initial investment of US$3 billion back in 2015. The government also created the Ministry of Small and Medium-sized Enterprises and Startups in July 2017.
As for Seoul, the metropolitan government announced its plan to make the capital city a regional startup hub, with an investment of US$1.1 billion over the next five years, as reported by The Korea Herald in March.
“Fifty percent of South Korea’s economy centers in Seoul, so even if some startups are established in other cities like Daejeon or Busan, they will later move to Seoul (for greater business exposure). It is also easier for them to go overseas from Seoul,” said Moon, noting Seoul’s unique advantage to attract entrepreneurs.
“The Seoul government has started to pay more heed to supporting startups since 2009. There has been a kind of imbalance in the city’s economic development since some famous universities or business conglomerates are concentrated in only a few districts,” said Moon. “By helping startups, it will be conducive to balance the economic development between different districts.”
Fostering startups will also promote economic development by creating more jobs, especially when Seoul’s unemployment rate is relatively high at the moment, said Moon. Seoul’s level of unemployment was reported at 4.8 percent in June, down from 5.3 percent in May, according to data services provider CEIC.
More importantly, Moon said the hub can serve as a gateway for the global expansion of startups as many of them seek to explore the foreign market. As of June, the hub had signed memorandums of understanding with eight global partners in countries such as China, Singapore and the United States.
“If we can form partnerships with foreign governments and enterprises, then we can work together to incubate startups on both sides,” said Moon, who expects to grow the number of global partners to 50 by 2022.
“Many South Korean startups want to enter the Chinese market,” said Moon, adding that science parks in some Chinese cities like Qingdao, which is close to South Korea, have had recent talks with the hub about helping startups expand their business from Seoul to China.