Seoul City Invests 175 Billion Won in Promising Startups Leading the 'Post-Corona' Economy

Support of 50 Billion KRW Including Labor Costs for 10,000 Core Employees
'Growth Promotion Comprehensive Package' of 100 Million KRW Each for 100 Potential Companies

[Asia Economy Reporter Jo In-kyung] Seoul City is focusing on startups as the growth engine to lead Seoul's economy in the 'post-COVID-19' era following the novel coronavirus (COVID-19) outbreak and is boldly investing a total of 175 billion KRW.

On the 10th, Seoul Mayor Park Won-soon held a briefing and announced the '3 Major Growth Strategies,' which include setting the bio-medical industry and non-face-to-face industries such as fintech, robotics, and drones as the two main strategic sectors, and supporting growth-stage startups.

First, the city will establish a dedicated fund of 115 billion KRW for growth-stage startups to prevent excellent technology holders from going bankrupt due to sudden economic shocks without timely investment and to invest in seizing opportunities. Using SBA funds, the city will invest 11.5 billion KRW (1.5 billion KRW from the SBA investment fund and 10 billion KRW from the Innovation Startup Fund), with the remainder raised from private financial companies and others.

Through this, starting in August, a total of 15 billion KRW will be proactively invested in 100 promising startups that have received seed funding or 'Series A (200 million to 1 billion KRW)' investments and are awaiting follow-up investments. Additionally, in December, an additional fund exceeding 100 billion KRW will be raised to invest at least 3 billion KRW per company in up to 32 companies at the 'Series B' stage, which have raised over 1 billion KRW in investments.

To stabilize employment and promote new hiring in the technology development sector, the city will also support the labor costs of 10,000 technical personnel across approximately 2,000 promising startups. Depending on company size, 3 to 7 people will receive 5 months of support, with 5 million KRW per person (1 million KRW per person per month).

The target startups are those at Series A or above in the bio-medical and non-face-to-face hardware and software sectors, and the city plans to open a dedicated reception desk at the Seoul Business Agency (SBA) in July.

The 'Comprehensive Growth Promotion Package' will provide 10 million KRW each to 100 promising startups with the potential to grow into 'pre-unicorns,' startups valued at over 100 billion KRW.

Starting in July, after a strict verification process, companies with investment achievements or high technology maturity will be prioritized for selection, with 30 of the 100 companies chosen from the bio-medical sector, which has gained attention due to COVID-19.

In this regard, Seoul City will sign a 'Win-Win Agreement for Promoting Next-Generation Promising Startups through Seizing Opportunities in Response to COVID-19' with representative startup organizations such as the Korea Startup Forum and the Angel Investment Association. The goal is to create a 'virtuous cycle startup ecosystem' where promising startups grow into global companies through various supports from Seoul City and, in turn, support younger startups in Seoul.

Mayor Park said, "While large corporations and multinational companies led the global economy in the past, in the post-COVID-19 era, a 'Startup Renaissance' should open where promising companies coexist, challenge new opportunities, and seize future markets. We will support more boldly so that Seoul's startup ecosystem does not regress but rather finds opportunities amid the crisis."

This content was produced with the assistance of AI translation services.