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A 15 MINUTES CRASH COURSE ON
A Country Overview
TRANSFORMING KOREA 1
An Introduction to Korean Startup Ecosystem
CAMBRIAN EXPLOSION IN KOREAN STARTUP ECOSYSTEM 2
TABLE OF CONTENT
To Connect Startup Ecosystems
WHAT KOREAN STARTUP ECOSYSTEM MEANS TO YOU 3
A Country Overview
TRANSFORMING KOREA
24% of California
423,970km² vs 99,678 km²
3.9% of China
13.5B vs 500M
65years in state-of-war ever since 1950
vs North Korea
Some basic facts about Korea…
GANGNAM 1953 GANGNAM 2015 $1.3B GDP
$67 Per Capita Income
$1778B GDP
$28,100 Per Capita Income
Miracle of Han River
South Korea achieved a market economy that ranks 13th in the world by nominal GDP and 13th by purchasing power parity (PPP).
One of the Major Economies in the World..
* Source: International Monetary Fund (2014)
South Korea is the only country in the world whose entire population can access 4G connectivity.
The World’s Most Wired Country
Smartphone penetration (% of pop.)
79.5% (42.5% in 2011)
LTE Penetration (% of pop.)
68.8% Average mobile connection speed
15.2 Mbps Projected mobile economics by 2017
$40B ($27B in 2013, 2% of GDP)
* Source: NCTA (2014)
* Mobile connection speed in the US: 9.8Mbps
10 Korean unicorns since dotcom bubble…
* Source: Venture Beat, 2014
“10 companies belong to what we call the “Korean Unicorn Club” (by our definition, Korean software companies valued at over $1B by public or private market investors””
John Nahm
Partner at Strong Ventures
The report focused on six tangible activities that contribute to innovation, including the number of high-tech companies, R&D expenditure per capita, gross value added by manufacturing, the number of patents and research personnel per capita and post-secondary education levels.
The most innovate country
“South Korea tops this year's overall ranking.”
* Source: 2015 Global Innovation Index by Bloomberg
2. Country Overview 2-1 Stone Cold Numbers and Facts
Koreans are the most widespread people, with more than 7.3
million residing in 180 countries in every corner of the world.
With the most wide-spread network of diaspora
* Source: Overseas Korean Foundation
** Israel has 7.3 million overseas population in 100 Countries and China has 45.4 million in 130 Countries
2. Country Overview 2-1 Stone Cold Numbers and Facts
# of Students studying in U.S and China
Korea marks the 3rd place
in # of students studying abroad in the U.S following China & India
Korea marks the 1st place
in # of students studying abroad China Followed by the U.S and Thailand
* Source: 2015 Institute of International Education
An Introduction to Korean Startup Ecosystem
CAMBRIAN EXPLOSION IN KOREAN
STARTUP ECOSYSTEM
In an effort to generate new sources of economic growth through the Creative Economy initiative, President Park Geun-hye created:
The Ministry of Science, ICT and Future Planning
Government in Action
MSIP budget increase in 2015
$13B in 2014 ▶ $14B in 2015 (4.8%)
Innovation centers for creative industries will be established in 17 major cities across the country in a bid to quickly develop those industries.
Government in Action
Government in Action
Under the Creative Economy Initiative, public sector is fostering an environment where venture firms can flourish by expanding financial support for innovative start-ups.
A "negative system" and the "sunset rule" applied
in principle to all new regulations beginning in April 2014. 700 regulations were repealed or improved out of 3100 by Financial Service Committee.
Deregulation
Research Society for Teachers in Software Education established by Ministry of Science, ICT and
Future Planning & Korea Foundation for the Advancement of Society and Creativity.
SW Education
To stimulate investment in startups the Growth Ladder
Fund raised $2.4B to finance startups. The number of
KOSDAQ & KONEX-listed companies surged to 104 in 2014 from 21 in 2012. (Invested $280M in 52 companies in 2014)
Capital Injection
Emerging Startup Ecosystem in Gangnam
March 2013 April 2014 April 2015 March 2014
23+ Accelerators
22+ Local VCs
5+ Corporate VCs
4+ Overseas VCs
23+ Government departments, institutions
17 Creative Economy Centers
6+ Events & Networks
4+ Startup media
4+ consulting firms
3+ Major Coworking Space & Incubators
* Source:
Emerging Startup Ecosystem in Gangnam
More than 30% of startups registered at
Rocket Punch are located in Gangnam. Imitating Silicon Valley, a media playfully named the area “Seolleung-con Valley.” Most active accelerators, co-working spaces and startups are located nearby Seolleung and Teheran-ro, the main area of Gangnam.
* Source: Rocket Punch
And it is increasingly globalized
$400M
$100M
$100M
Acq’d @$40M
Raising $15M(Kimchi Fund) Raised $100M
$36M
Acq’d @$40M
“There is a growing interest from overseas VCs in the South Korean venture ecosystem as well as a rise of angel groups, accelerators and event organizations to promote entrepreneurship in Korea.”
“Gangnam Becomes Hot Spot for Korean Startups…Gangnam has a special significance in South Korea as the place where a globalized youth culture emerged from a generation that had opportunities to travel and study abroad. The present day Gangnam is still seen as the place that brings foreign culture and ideas to the rest of the country.”
1.재벌 의존 경제 구조에서 벤처 창업이 대세라고 불릴 만큼 변하고 있음. 벤처 통계 이유: 청년 실업률일까? 정부 지원일까? 글로벌 트렌드일까? (모두 다) 청년 실업률 통계 The Korean economy is, as widely known, dominated by the chaebol, huge conglomerates. Samsung accounts for around a fifth of the country’s exports. The chaebol fairly gets credit for having played a vital role in South Korea’s economic development. Competing with the chaebol is almost impossible to succeed. However, the influence of chaebol is slightly diminishing and there are certainly visible trends of the rise of start-ups. start-ups. It is hard to prove statiscally yet, but it is empirically notable and media is reporting the trend.
Successful entrepreneurs becoming angel or VCs
BG Chang Founder, Neowiz
$470M
Douglas Guen Founder, Inicis
$640M
Taekkyung Lee Co-Founder, Daum
$6.6B
Junghee Ryu Founder, Olaworks
$35M
Beom-soo Kim Founder, Kakao
$6.6B
Jiwon Moon & Changseong Ho Founder, Viki
$220M
And a Cultural Shift…
Undergrad’s preference for their first job
Students Parents
Startup / Venture
Big Companies
Public Company
Foreign Company
Public Official
* According to a survey on 575 undergrads & job seekers by Job Korea
More bright young Koreans who used to think working as lawyers/doctors venture themselves for startups.
2nd Generation Korean and those talents who studied in the top U.S schools are
coming back to Korea to embark on their own businesses.
To Connect Startup Ecosystems
WHAT KOREAN STARTUP ECOSYSTEM
MEANS TO YOU
Prepare worldwide launch in Korea Cultural similarity in Asia A door to Asia Relative low wage yet high quality talents A call to action to connecting ecosystems Hosting a Korea delegate of entrepreneurs & VCs Send a delegate of VCs and entrepreneurs to Korea Not only a startup Korean diasporas
What Korean Startup Ecosystem has to offer?
“Korea is a unique market where over 90 percent of users access Facebook through smartphones. Facebook has also recently partnered with the nation’s automobile manufacturer Kia Motors to increase the social experience for passengers in their vehicles. This makes Korea an important test bed to Facebook wishing to be a mobile-first company.”
- Benjamin Joe, Head of Facebook Korea
“What can be achieved in two years in Taiwan can be achieved in just 6 months in Korea”
- Terry Gou, Chairman of Foxconn
“Two of the top three games in China are Korean exports – Smilegate’s Crossfire and Nexon’s Dungeon Fighter. Crossfire earned almost $1B last year in China”
- Tech in Asia
Let’s connect the dots!
BRIDGE Host a Korean delegate of entrepreneurs & VCs in your city! Send your delegate of VCs and entrepreneurs to Korea!
“A presence in South Korea is indispensable for truly global brands and could in fact constitute an excellent launching pad to reach the Chinese and Japanese markets.”
Jean–Jacques Grauhar
former Secretary General EU Chamber of Commerce
