President Park Geun-hye has planted the seeds for a new forest that will grow into a venture startup ecosystem, combining government support and the passion of young founders.

The president emphasized the importance of starting new businesses in order to realize her government's vision for a "creative economy" and of promoting collaboration. She was speaking during a ceremony to mark the opening of the Tech Incubator Program for Startups (TIPS) Startup Town on July 14.

“The number of university clubs organized around starting new businesses has increased. The number of venture startups and investments in venture projects has shown a record-high rise. These are thanks to efforts being jointly-made by the government and the private sector to build an ecosystem for venture startups,” said President Park, while pointing out that much still needs to be done in order to help the venture ecosystem function smoothly.

“A higher number of startups go bankrupt here than in advanced economies. The virtuous circle of a venture ecosystem has not been properly built here. To create a healthy ecosystem for venture startups, the government will extend the tax benefits of stock options and lower standards on tax support for acquisitions or takeovers that focus on technological innovation.”

"More important than tax benefits, however, is the fact that venture firms with new ideas and technologies should produce a profit, with the hope of a successful exit in the future. We need to protect intellectual property rights at venture firms and build an infrastructure of capable firms so that they can actively take part in acquisitions or takeovers,” said the president.



In regard to crowd-funding laws that have taken two years to pass through the National Assembly, President Park said that, “In the past, many Korean venture firms received crowd-funding overseas. Thanks to the new laws, however, now they can do so in Korea.”

She also vowed to support the crowd-funding system, saying that, “The government is preparing to introduce a crowd-funding system so that anyone with a good idea can easily attract investment funds online.”

The president emphasized the importance for new venture startups to enter overseas markets, saying that, “The world is eyeing our Centers for a Creative Economy and Innovation, this TIPS Startup Town and our funds-of-funds, as they create a new collaboration model for the 'creative economy,' backed by cooperation between the government and the private sector, where large companies and venture startups can coexist.”

“I believe that Korea’s model for its 'creative economy' will be taken up all around the world, just as the popularity of Korean pop culture, hallyu, has spread worldwide. Just as funds-of-funds have played a role in priming new businesses and in watering the seeds for new startups over the past ten years, I hope that this TIPS Startup Town can become a hub for venture startups across Asia, with exchanges between new ventures and global companies.”

By Yoon Sojung
Korea.net Staff Writer
Photos: Cheong Wa Dae
arete@korea.kr