Accelerating SME Scale-up through Public-Private Partnership R&D Support

[Asia Economy Reporter Donghyun Choi] The Ministry of SMEs and Startups announced on the 11th that it has selected 25 small and medium-sized enterprises (SMEs) for the ‘Private Investment-Linked’ projects under the ‘SME Technology Innovation Development Project.’

The SME Technology Innovation Development Project is a flagship R&D program of the Ministry of SMEs and Startups that selects SMEs with innovative capabilities and supports their scale-up through technological innovation. SMEs with sales of over 2 billion KRW are eligible to apply.

The newly selected ‘Private Investment-Linked’ projects target SMEs that have received private investments of over 500 million KRW in the past three years and select companies with technological development capabilities to provide up to 600 million KRW in R&D funding over two years. This program is differentiated from other R&D projects in that it targets SMEs that have already received private investment support.

Looking at the characteristics of the selected projects, most were concentrated in the ICT and bio-medical fields, which attract significant private investment. ICT accounted for 44% (11 companies), and bio accounted for 32% (8 companies). Promising future growth sectors such as secondary batteries, electric and hydrogen vehicles, and other ultra-gap technology fields followed.

In particular, this year, the Ministry actively discovered regional innovation companies to significantly reduce regional disparities in R&D funding support. Specifically, the selection ratio of SMEs in non-capital regions increased from 25% in the first half of last year to 48% this year. This has alleviated concerns about capital region-centric support and expanded R&D participation opportunities for regionally promising SMEs.

The ‘Private Investment-Linked’ projects have been implemented since 2020. Companies selected at that time attracted follow-up investments approximately five times the government grant (5.25 billion KRW per 1 billion KRW). Among them, seven companies have shown excellent results such as IPOs on KOSDAQ, mergers and acquisitions (M&A), and technology-special listing during the technology development period.

Won Young-jun, Director of Technology Innovation Policy at the Ministry of SMEs and Startups, said, “By providing follow-up support to SMEs that have been pre-validated in the market, we plan to continue supporting them to maximize the effect of government R&D support.”

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