Seoul City to Discover 2,000 Innovative Startups and Match Them with Large and Mid-sized Companies... "Establishing a Private-led Startup Ladder"

Creating a Private-Led Startup Ecosystem... Matching 200 Large and Mid-Sized Companies with 2,000 Startups by 2024
‘Open Innovation Centers’ by Hub in Yangjae, Hongneung, etc... New Participants Include Pepsi Korea, BMS, Shinhan Financial Group

[Asia Economy Reporter Lim Cheol-young] On the 26th, the Seoul Metropolitan Government announced that it will fully promote open innovation to create a private sector-led startup ecosystem, moving away from government-centered startup support policies such as technology development (R&D) support, provision of corporate spaces, and commercialization support. The goal is to discover 2,000 innovative technology startups by 2024 and match more than 1,000 startups with large and medium-sized enterprises.

Seoul City stated that it will implement three major strategies: ▲ expanding the ‘open innovation market’ by encouraging participation from large and medium-sized enterprises by industry ▲ maximizing open innovation outcomes by expanding opportunities for convergence among different industries such as robotics, fintech, artificial intelligence, and bio ▲ and establishing a ‘global open innovation hub’ by expanding overseas growth bases.

First, to expand participation of domestic and foreign private companies, Seoul plans to increase the number of large and medium-sized enterprises participating in open innovation from the current 42 to over 200 within the next three years through the formation and operation of the ‘Seoul Open Innovation’ forum with large and medium-sized enterprises and associations. The ‘Seoul Open Innovation Forum,’ which proposes and discovers innovation tasks of large corporations and startup solutions in cooperation with private companies, the Federation of Medium-sized Enterprises, and the KOSDAQ Association, will be held monthly at major startup hubs and clusters.

This year, 80 large and medium-sized enterprises, double the previous number, will participate in open innovation. About 40 new companies, including BMS, Kakao, and Shinhan Financial Group, will join this year. In particular, participation of companies located in industry-specific clusters such as artificial intelligence, bio, and fintech will be expanded from this year. To foster future growth industries like AI, bio, and fintech, the city will focus on strengthening corporate venturing with large and medium-sized enterprises located in industrial clusters such as Yangjae Hyundai Motor (AI/robotics), Magok LG Science Park, and Yeouido Shinhan Financial Group (fintech).

Seoul will establish seven open innovation centers in Yangjae, Hongneung, Gongdeok, and other locations to efficiently promote ‘open innovation’ and expand demonstration opportunities in fintech and biomedical fields. The centers will operate a system for continuous discovery and verification of startups, aiming to discover 2,000 innovative startups in collaboration with 200 large and medium-sized enterprises and venture capitalists (VCs) over three years.

The open innovation centers will be gradually opened from April this year at four regional Seoul Startup Hubs (Gongdeok, Seongsu, Changdong, M+) and three industry-specific bases: AI Yangjae Hub, Seoul Fintech Lab, and Seoul Bio Hub. These seven centers will identify the needs of large and medium-sized enterprises and support matching between these enterprises and startups by discovering and verifying excellent startups in cooperation with private VCs and associations.

Furthermore, the city will maximize the outcomes of ‘open innovation’ by expanding opportunities for convergence among industries such as robotics, bio, and AI, and diversifying cooperation touchpoints by cluster and industry. To diversify opportunities for selecting innovative companies according to the technologies (themes) required by large and medium-sized enterprises, the city will expand matching opportunities between companies through challenges (competition formats). Seoul Startup Hub Gongdeok, which is actively promoting open innovation, will see participation from a total of 15 companies this year, including new participants such as Pepsi Korea, Whirlpool, and Volvo, in addition to the existing five companies like Mercedes-Benz Korea.

Support will be provided from technology demonstration of innovative technologies to overseas expansion. Large and medium-sized enterprises will discover and invest in startups, while Seoul City will support startups’ global expansion through technology demonstration and overseas local networking, which are difficult for individual companies to access. The city plans to expand more than 10 overseas growth bases over the next three years, including Silicon Valley and Europe, to serve as hubs for global market entry, similar to the ‘Seoul Startup Hub’ currently operating in Ho Chi Minh City. These bases will be used as gateways for Korean companies to enter overseas markets and as investment attraction channels where foreign companies can match with promising domestic companies.

Additionally, Seoul will actively utilize opportunities such as Try Everything, the representative startup festival of Seoul, and the Consumer Electronics Show (CES) to promote Seoul’s promising startups worldwide and expand touchpoints for matching with investors. The city will revamp Try Everything, the global startup festival held since 2019, into a company-centered program featuring more than 10 ‘large and medium-sized enterprise - startup pitching’ sessions and over 100 venture capital (VC) and corporate venture capital (CVC) meetups and IR events both online and offline, focusing on matching with large and medium-sized enterprises and linking with private investment.

Hwang Bo-yeon, Director of Seoul City’s Economic Policy Office, said, “Open innovation is a private sector-led startup growth ladder that improves corporate capabilities by utilizing external resources such as technology and ideas, and drives win-win growth between large and medium-sized enterprises and startups. We will create a corporate-led startup ecosystem where large and medium-sized enterprises, ventures, and startups cooperate for mutual growth.”

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