[Startup Struggles②-2] AI-Focused UK, Mobility Innovation in Southeast Asia... The Battle for the 'Next Silicon Valley'

The US Leads Startup Ecosystem with 210 Unicorns, Twice as Many as 2nd Place China
UK Tops Europe at 3rd, Focusing on AI for Innovation in Fintech and Security
Southeast Asia Rising... Singapore Ranks 14th Globally, Indonesia Hosts Half of Southeast Asia's Unicorns

[Asia Economy Reporter Minwoo Lee] As startups are hailed as the answer to future innovation, startup ecosystems are expanding worldwide. Leading the way is the United States' Silicon Valley, which overwhelmingly dominates almost every field, while other regions are focusing on technologies such as artificial intelligence (AI) and mobility, racing toward becoming the 'Next Silicon Valley.'

◆The United States: Overwhelming No.1...The strongest across all fields= The U.S., which gave birth to giants like Google and Facebook, still maintains the world's top startup ecosystem. Simply in terms of the number of unicorns (startups valued at over 1 trillion KRW), the U.S. boasts 210, far surpassing China’s 102 and the U.K.’s 22. According to the 2019 startup ecosystem rankings (city-based) published by global startup analysis firm Startup Genome, which comprehensively evaluates funding, talent, and business performance, 9 out of the top 20 cities are in the U.S. Besides Silicon Valley, New York (2nd), Boston (5th), Los Angeles (6th), and Seattle (12th) are also prominently ranked. The U.S. shows strength in various sectors, including AI, fintech (technology + finance), biotech, and healthcare, standing out across the board. This is why it is called the strongest startup nation.

◆The U.K., the European startup hub, ranks 3rd globally in unicorns with a focus on AI= The U.K. is the leading startup powerhouse in Europe. Former Prime Minister David Cameron systematically supported the startup ecosystem by establishing 'Tech City' in London in 2010, providing infrastructure, investment, and connections with universities. As a result, the U.K. ranks third in the number of unicorns, following the U.S. and China. London holds the 3rd position in the global startup ecosystem rankings. The gap with other European countries has already widened. As of 2018, startup investment in the U.K. was 7.21 billion euros (approximately 9.4158 trillion KRW), 1.6 times that of Germany, the second-largest in Europe. The number of investments also surpasses France and Germany, ranked 2nd and 3rd, by more than 1.6 times.

The U.K. startups are particularly focused on AI. The government, together with the private sector, is building an innovative AI ecosystem and sparing no support to ensure global competitiveness. As a result, investment in U.K. AI startups reached 1.3 billion USD last year, overwhelmingly surpassing France (300 million USD) and Germany (300 million USD), ranked 2nd and 3rd.

Most leading unicorns are also AI-based. Darktrace, valued at 1.9 trillion KRW, provides cybersecurity services using AI. When the WannaCry ransomware (malicious software that encrypts data and demands payment for decryption) was rampant worldwide in 2017, Darktrace’s AI defense system blocked it within seconds. Other notable AI startups include Babylon Health, which offers AI-based telemedicine services, and BenevolentAI, focused on AI-driven drug development.

◆Grab and Gojek dominate Southeast Asia...Evolving into big platforms through mobility= The Southeast Asian region is experiencing a vibrant startup ecosystem centered around mobility startups. Initially aimed at solving local transportation inconveniences, these startups are gradually expanding into finance, shopping, and other areas, evolving into massive platforms essential to daily life.

Singapore’s Grab and Indonesia’s Gojek are prime examples. Grab is the largest ride-sharing service provider in Southeast Asia, covering eight countries including Singapore and the Philippines. As of last year, its cumulative investment exceeded 10 trillion KRW. It has grown into a massive platform encompassing finance and healthcare. Gojek, Southeast Asia’s first unicorn, started in 2010 as a motorcycle taxi app. Initially a service mediating transportation like taxis, it has expanded to food delivery, laundry, and other convenient daily services, as well as finance and mobile payments, establishing itself as a 'super app.'

These achievements have earned significant recognition in the global startup ecosystem. According to Startup Genome, Singapore already ranks 14th in the startup ecosystem rankings. Jakarta, Indonesia, is considered one of the top 30 next-generation cities.

Governments in each country are also actively fostering startups. Indonesian President Joko Widodo, who was re-elected last year, has made 'startup cultivation' a key pledge. Since four out of eight Southeast Asian unicorns are Indonesian companies, there is a plan to further develop the country into a unicorn haven. Singapore, which hosts 63% of Southeast Asia’s venture capital (VC), has already set 'Smart Nation' as a national goal to promote startup activation.