Reflecting Industry Characteristics, Reducing New Certification Burden... 'Venture Certification' Reform

Ministry of SMEs and Startups Implements Revised 'Venture Business Verification Guidelines' on 1st
Introduces Evaluation Indicators Reflecting Industry Characteristics Such as Bio
New Venture Companies Focus on Growth Potential Evaluation

The ‘Venture Certification’ system, which had been criticized for its lack of practicality, will be completely revamped. The new system will reflect the characteristics of new industry sectors such as bio, and ease evaluation criteria for newly applying companies to reduce their burden. The business plan format will also be changed to an industry standard.

On the 1st, the Ministry of SMEs and Startups announced the implementation of the revised ‘Venture Business Verification Guidelines’ based on these points. The venture business verification system is designed to recognize and support companies with excellent innovation and growth potential as venture businesses. This revision was carried out after gathering opinions from the ‘Venture Business Verification Committee,’ ‘Professional Evaluation Agencies,’ and related experts.

First, evaluation indicators reflecting the characteristics of each industry were introduced. For the bio sector, indicators such as the stage of new drug development were added, and for platform sectors, the number of active users was included to reflect industry-specific traits. Additionally, companies can now select the indicators by which they wish to be evaluated. Previously, the system only considered financial factors such as sales and operating profit when assessing growth potential, making it difficult for industries that struggle to generate sales before product development completion to obtain venture certification.

The burden of certification for new venture companies has also been reduced. This change addresses criticism that previous evaluation indicators did not adequately reflect the characteristics of early-stage startups, which find it difficult to produce early results. Going forward, early-stage startups will be primarily evaluated on the feasibility of their future business plans and growth potential rather than past performance, lowering the system’s entry barriers. For companies applying for re-certification, venture status will be determined based on performance during the last verification period (3 years), not the entire business duration.

The business plan format will be changed to the PSST method, which is widely used in today’s venture and startup industries. This reduces the burden of preparing a separate form specifically for venture certification. Furthermore, subjective elements from previous evaluation indicators such as ‘entrepreneurial spirit of the founder,’ ‘sustainable management,’ and ‘stage of business concretization’ have been integrated into the appropriateness of the business plan to enhance evaluation objectivity.

Meanwhile, alongside this system reform, the Ministry of SMEs and Startups has established the ‘Venture Business Statistical Information System’ within the Venture Verification Management System (www.smes.go.kr/venturein). This will allow public institutions, research organizations, and venture investors to easily understand the status of venture companies and directly utilize related information by providing statistics on venture companies by industry, business age, and region over the years. Minister Lee Young of the Ministry of SMEs and Startups stated, “We will operate the venture business verification system so that companies in ultra-gap fields such as bio can be recognized for their technological achievements and growth potential and leap forward as venture companies, the new growth engine of Korea’s economy.”

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