120,000 New Corporations Established Last Year... Government Officially Declares "Second Venture Boom" Arrival

Ministry of SMEs and Startups Announces Results of 'Analysis on Changes in Korea's Startup Ecosystem'
Increase in Tech Startups and Investments, 13 Unicorns... Recognized Overseas as Well
Government-Supported Startup Sales Rise from 300 Million to 600 Million... Startup Policy Improvements

[Asia Economy Reporter Kim Bo-kyung] The government has officially stated that the era of the 'Second Venture Boom' has arrived as the domestic startup ecosystem continues to grow both quantitatively and qualitatively, and venture investments have surged.

On the 26th, Kwon Chil-seung, Minister of SMEs and Startups, announced the results of the 'Analysis of Changes in the Korean Startup Ecosystem' at the Government Seoul Office. This announcement is significant as it is the first comprehensive analysis of the startup ecosystem changes over the past 30 years to be publicly released.

Minister Kwon stated, "The external scale of our startup ecosystem has grown significantly over the past 20 years from 2000 to 2020, confirming that the Second Venture Boom has arrived, surpassing the First Venture Boom of the early 2000s."

The number of newly established corporations increased by more than 60,000 over 20 years, from 61,000 in 2000 to 123,000 last year. Notably, 43.8% (27,000) of this increase occurred in the four years from 2017 to last year.

The total number of startups, combining individual and corporate startups, has also been increasing annually, with technology-based startups notably growing by 20.1% over the past four years (from 191,000 in 2016 to 229,000 in 2020).

The startup ecosystem is also growing qualitatively. The number of unicorn companies?unlisted companies valued at over 1 trillion won (1 billion USD)?increased from 2 in 2016 to 13 last year.

Korean startups have been consistently selected among the Young Global Leaders by Forbes since 2016, starting with 5 companies. Seoul entered the Startup Genome's 2020 startup ecosystem ranking for the first time, placing 20th among 270 cities.

New venture investment, which was around 2 trillion won during the First Venture Boom, surged after 2016, setting new annual records and surpassing 4 trillion won in 2019.

The Ministry of SMEs and Startups' budget for startup support increased dramatically from 8.2 billion won in 1998 to 376.6 billion won in 2016, and 849.2 billion won in 2020. Over the recent four years, it increased by 472.6 billion won, accounting for about 60% of the total increase over the past 20 years.

The sales of government-supported startups doubled over the past decade, rising from 296 million won in 2009 to 607 million won in 2019, and employment increased from 3.9 employees in 2009 to 7.1 employees in 2019.

Especially notable were the achievements of startups participating in the TIPS program, the Ministry's flagship startup support project. More than half of the startups that received initial investment through TIPS attracted follow-up investments. The scale of follow-up investments reached 3.9 trillion won, about 14 times the initial investment of 270 billion won.

Additionally, over the past four years, the government has improved startup policies by expanding exemptions from burdens on manufacturing startups, abolishing joint guarantees, easing tax burdens such as increasing deduction rates for angel investments, expanding the startup visa system, and introducing public procurement systems.

Minister Kwon said, "As the person responsible for startup and venture policies, I feel proud and grateful for how far the startup ecosystem has developed. We will continue to sustain the passionate startup momentum to ensure the successful establishment of the Second Venture Boom."

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