|Illustration by Nam Kyung-don|
They defy rules and norms. They set no limits to destroying the old and creating the new. They have zero chance of succeeding in creating disruptive technologies in this market that is heavily reliant on and driven by conglomerates.
They choose risk and rebellion over security because they believe that they can make the world a better place with game-changing technology or creative ideas.
They are the entrepreneurs of tomorrow.
Recognizing their true potential for the economy, the government has reached out to Korean entrepreneurs, regardless of whether they failed or succeeded, to seek solutions to the country’s high youth unemployment.
It began mobilizing its related agencies and state capital, ranging from the state-run Korea Development Bank and the Small and Medium Business Administration to the Ministry of Education and the Ministry of Science, ICT and Future Planning, to provide essential policy and support programs to jumpstart the country’s entrepreneurial culture and venture ecosystem.
Not only faced with prolonged youth joblessness, the government is seeking to diversify industries in the economy, which has long been overly dependent on big companies such as Samsung, Hyundai Motor and LG for growth.
“Ventures can help the economy diversify like they did in the U.S., Japan and Taiwan,” said Chester Roh, co-founder of 5Rocks, a start-up that analyzes big data for mobile game developers.
“If start-ups are not promoted as an option, Korea will only have two types of businesses: masters (represented by big companies) and their servants.”
Korea’s youth productivity continues to decline, with many college graduates struggling to secure their dream jobs at conglomerates or state-owned enterprises.
The government seeks to turn this tide by encouraging the young to “be their own boss” by embracing the risk of venture entrepreneurship.
But venture business is not easy, as first-generation entrepreneurs and venture capitalists have warned ― and therefore, it’s not for everyone.
Roh of 5Rocks, who has tasted both success and failure numerous times as a serial entrepreneur, advised that those who seek to launch start-ups must come “prepared by really knowing how to analyze and forecast their markets.”
Entrepreneurship is about moving ahead of the trend by discovering and inventing something new every five years, Roh added.
Otherwise, they will most likely fail immediately, said Jimmy Rim, CEO of K Cube Ventures, a venture capital fund established by Rim and Kakao founder Kim Beom-soo.
“This is a premier league where only the very best survive,” Rim said. “Unless you have a clear motive and the ability to find a problem and solve it, I usually tell (entrepreneurs) not to launch start-ups at all.”
Entrepreneurs should use whatever resources they can ― whether from universities, government-affiliated agencies such as the SMBA or personal networks ― to gain management and technological acumen.
Staying “lean” is also key to sustaining a venture business, according to Kim Yong-sul, head of the Seoul Junior Business Incubating Center of Seoul Business Agency.
Before embarking on ventures, young entrepreneurs should understand that setting up a successful company is a lonely, painful process like climbing up a steep mountain path or walking across a desert in search of water, entrepreneurs said.
But for someone like Sul Bomi, CEO of social mobile app developer Woo Wa Girls, who failed numerous times to secure a job after having two children, venture offered her a “second chance” in life.
“For me, I find starting a company to be like an ‘emergency door’ to my dream,” she said.
Ludolf Ebner-Chung, former CEO of Yogiyo, a mobile food delivery platform, believes Korea is the place to be to start or restart a business in IT or mobile.
He said that not only is setting up in Korea “easy,” but start-ups also have a leg-up over conglomerates by being less bureaucratic and able to make faster “instinct-driven innovative decisions.”
Conglomerates and bigger medium-size companies should also take the fullest advantage of the spirit of venture entrepreneurship through in-house programs and R&D competitions, suggested Thomas D. Nastas, a global entrepreneur and venture capitalist.
“Another suggestion to speed up Korea’s creative economy and ecosystem is to (further) encourage conglomerates and bigger medium-sized companies to establish internal venture capital funds,” he said.
Multinational companies such as Samsung Electronics and Intel, for example, have corporate VCs ― Samsung Venture Investment and Intel Capital, respectively ― that made “strategic investments” in start-ups and SMEs.
These led not only to increased sales of their products but also stimulated innovation and job growth, Nastas noted.
In creating an ecosystem, it all comes down to start-ups having a solid team of talented people, industry experts emphasized.
“If asked which is more important ― developing a perfect business model or having a (perfect) team ―I would chose the latter,” said Ahn Joon-hee, CEO of Handstudio, a content app developer for smart TVs.
“This is because a great team can make any business model work and succeed.”
On the other hand, experts also stressed that venture entrepreneurship is not everything, and other options should be explored to achieve personal goals and economic sustainability and diversity.
Rim of K Cube said that Korea displays a tendency for everyone to move in the same direction, which could cause a side effect as seen from Korea’s first venture boom in the aftermath of the Asian financial crisis.
“Venture is one of (many) options for personal growth, and the young should explore many career possibilities throughout their life,” Rim said.
By Park Hyong-ki and Shin Ji-hye