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LOS ANGELES, CA, March 14, 2023 /24-7PressRelease/ -- The Seoul Metropolitan Government announced that it will be increasing its support for four of Seoul Startup Hub locations (Gongdeok, M+, Seongsu, Changdong), which play a pivotal role in designing the city's startup policies, in order to maintain the growth of the startup ecosystem and its players amid the prolonged economic recession.
The city plans on building a "startup-friendly city" by focusing its investments so that an "innovative startup ecosystem" can propel overall economic growth.
The Seoul Metropolitan Government currently runs 29 startup support facilities that provide systematic support for startups in areas they need the most, including acceleration, global expansion, and investment attraction. Among the 29 locations, the aforementioned four startup hub centers are being run as specialized bases in order to preemptively secure future growth engines.
* Specialized areas by hub: Gongdeok (global expansion), M+ (information technology (IT), bio (BT), nano (NT), environment (GT)), Seongsu (ESG), Changdong (new media)
Thanks to the intensive support that the city has provided to strengthen its startup ecosystem through various means, including the operation of the startup support facilities, Seoul ranked 10th among 280 cities in 100 countries around the world, up 6 places from 16th in the previous year, in the Global Startup Ecosystem Report (2022) published by "Startup Genome," an agency that evaluates startup ecosystems around the globe. In addition, the value of the city's startup ecosystem was evaluated at 223 trillion won (177 billion USD).
On top of this, Seoul's 37 startups, which were sponsored by the four startup hub locations, became the winner of the CES Innovation Awards at Consumer Electronics Show (CES) 2023, held in Las Vegas in early January this year.
The city will help speed up the global expansion of competitive startups and increase the opportunities for collaboration with large and mid-sized companies. A total of 868 startups will be incubated with the help of the Seoul Metropolitan Government this year.
To this end, the four startup hub centers will be focusing their efforts in five key areas this year: building a startup network with eight global cities (new business), expanding the number of partners to 595 companies for "open innovation," which matches technologies of startups with large and mid-sized companies, increasing the number of base locations in order to support global expansion into major countries, advancing the startup ecosystem both online and offline to improve the degree of accessibility between startups, large and mid-sized companies, accelerators and investors, and discovering and incubating promising startups in the industries of the future, including robotics and metaverse.
Diversifying support by building global inter-city startup networks
The city will be branding itself as a "startup-friendly city" by forming cooperative relationships with global cities that have a strong startup ecosystem in order to build a foothold for Korean startups for their global expansion and to encourage foreign investors to invest in Korea's promising companies.
The process will begin by first building a Global Incubator Network (GIN) between eight cities in four countries, including the United States and Canada, starting with Tokyo, Japan, in March, and selecting 20 promising startups to sponsor their sales activities abroad.
* GIN (Global Incubator Network) project: A program proposed by Apexe, an overseas private professional organization, to vitalize the global incubator network and to support deep tech startups to advance overseas
Startup incubators from eight international cities, including Seoul, will be providing opportunities for their deep tech (advanced manufacturing, robotics, AI, bio, etc.) companies with verified technological expertise to help them scale up through 1:1 incubation, partnership with large and mid-sized companies, demonstration of products and services tailored to local demands, and investment attraction.
Seoul's startups will be sent to join the program starting with Japan (Tokyo) in March, the United States (New York, Detroit, Pittsburgh) in June, and Canada (Montreal, Sherbrooke, Quebec) in October. Similarly, overseas deep tech startups will be invited to Seoul in September to be matched with startups and large to mid-sized companies based in Seoul, through which the city is expected to prove its competency as a startup-centric hub.
In addition, the city will conduct promotional activities to advertise itself as a "startup-friendly city" to help its startups expand globally and attract investment from domestic investors. The focus of these efforts will be to emphasize Seoul's lifestyle and future that are transformed by technology startups.
The Open Innovation Council, the city's private autonomous organization, will be finding and supporting innovation-driven startups by selecting "Seoul's Top 5 Startups This Year" for different categories, including bio and AI.
Accelerated growth by matching innovative technologies between large and mid-sized companies and startups
The Open Innovation opportunities will be extended to individual industry sectors through technological cooperation between startups and large to mid-sized companies, each with their proprietary technologies and products. The city will be selecting a total of 595 startups from different sectors, including AI, bio, environment, and beauty, and matching them with large to mid-sized companies. They plan on investing a total of 2.6 billion won to sponsor technology development, investment, and marketing activities.
※ 500 companies in new industries such as AI (Gongdeok), 25 companies in IT, bio, environment, etc. (M+), 30 companies in ESG (Seongsu), 40 companies in beauty, fashion, etc. (Changdong)
Open Innovation refers to sourcing technologies and ideas that a company needs from outside the company rather than through in-house R&D, or to creating new products and services through cooperation with other companies.
This co-growth model enables large to mid-sized companies to get a head start on technological partnerships with promising companies with relatively small investments. It also allows startups to leverage the capital and infrastructure of their counterparts to showcase their technologies in the market and secure sales channels to reduce time and cost.
Since 2019 when it was launched, the Open Innovation program has matched 409 startups with 101 large to mid-sized companies according to technological needs. This outcome has led to 225 technical partnerships, 137.8 billion won in investment, 961 cases of employment, and 180.9 billion won in sales.
The city will also be establishing a public-private consultative body for the Open Innovation program where 100 large and mid-sized companies and 500 startups will be participating. The organization will connect and co-shape various private entrepreneur bodies, including domestic and foreign investors, accelerators, related industry associations, startups, and large to mid-sized companies, as they discover opportunities for inter-industry convergence and technical tie-ups and exchange information on technological trends.
Supporting global expansion of startups through partnerships with major global countries on technology and investments
Seoul will systematize demonstration support to help Korean startups uncover their growth potential in overseas markets, in addition to expanding opportunities for researchers and investors both home and abroad to find technologies tailored to their needs.
This year, the city will select 120 startups with growth potential and invest 2.5 billion won to support their global expansion through different means, including establishing business models for respective global markets and supporting demonstrations of their products and/or services. To this end, Seoul will be opening two global hotspots in addition to the ones in Ho Chi Minh City, Vietnam, and Bangalore, India, in cities where Korean startups are more likely to enter.
In 2022, Seoul was able to attract 38.4 billion won in investment and create 125 jobs by helping 86 Korean startups establish overseas offices, demonstrate their technologies and prove their marketability, through partnerships with local institutions and accelerators in eight countries, including Vietnam, India, the United States, and Spain.
The global startup hotspots will be responsible for supporting demonstrations of products and services as well as networking for setting up local offices of individual startups, in partnership with local public institutions and partners.
M+, one of Seoul's startup hub locations, will be cooperating with renowned accelerators both from home and abroad, including PEN Ventures, Xiaomi, Creww, and Korea Accelerator Association, to invite R&D researchers and investors from large to mid-sized Chinese and Japanese firms to Seoul to match them with Korean startups that meet their technological needs and provide opportunities for evaluation and investment.
Advancing the online and offline startup ecosystem via new industry trends and technical cooperation
Seoul will be investing 3.8 billion won to strengthen the global network and partnerships and to promote technology trends-based interaction among the members of the startup ecosystem, including startups, large to mid-sized companies, and global partners. This investment effort will enhance accessibility between investors and startups by improving the functionality of online startup platforms and diversifying opportunities for investment.
Try Everything 2023, one of Seoul's biggest startup festivals to be held from September 13 to 15, will feature approximately 80 programs. Their goal this year is to ensure that on-site networking leads to actual investment.
These programs include the exchange of the world's latest startup and new industry trends, lectures by celebrated speakers at home and abroad, exhibitions and promotions by startups, meet-ups between investors and startups, as well as investor relations (IR) pitches.
"Startup Plus," an online platform that provides access to more than 180,000 startup-related data will be renewed into a smart online startup ecosystem that connects various groups participating in the startup ecosystem, from startups to investors, regardless of time and location. Its AI and big data-powered analysis will automatically match the demand of large and mid-sized companies with the technological prowess of startups. Also, English service will be made available to increase the accessibility for foreign investors.
Startup Plus, which was launched officially in April of 2022, provides access to more than 180,000 startup-related data items, including company information and investment status. It has played a pivotal role in matching and transferring technologies between different players, including private investors, mid to large-sized firms, and startups.
Acceleration/incubation program for promising startups through public-private cooperation
The city plans on investing 4.8 billion won toward offering one-stop support for 133 initial and growth stage startups in industries of the future such as robotics and metaverse throughout their entire startup journey, from incubation to investment, in cooperation with private incubator companies specializing in areas such as technology, investment, and business consulting.
This will include specialized and global social media marketing efforts in respective sectors for each startup hub location: [Gongdeok] new business areas including robotics, AI, food tech, metaverse, [M+] information technology (IT), nano (NT), environment (GT), bio (BT), [Seongsu] ESG of startups, and [Changdong] beauty and fashion.
In particular, the Changdong location will operate a "one-stop XR production" facility featuring XR-convergence content equipment to power the new media infrastructure in the northeast region, in addition to 9 individual studios that enable the production of Seoulite lifestyle content, from beauty, fashion, food to living, on a regular basis.
Startups can apply for the different programs available at the 4 startup hub locations on the 「Startup Plus (www.startup-plus.kr)」 online platform.
According to Tae-gyun Kim, head of Economic Policy Office of the Seoul Metropolitan Government, "Startups in their initial stages are struggling amid the series of post-pandemic crisis and risks brought on by the three highs, namely high interest rate, price, and exchange rate. We hope the four startup hub hotspots can establish a foundation that can encourage the growth of our unicorns and startups both at home and abroad, especially in the new growth sectors, including AI, bio, robotics, and fin-tech."
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