[Asia Exclusive] "Aiming for Global Companies from Startup Stage... Leading the 'Second Venture Boom'"

Kang Sam-gwon New Venture Association Chairman
Building Win-Win Model Between Large Corporations and Startups to Support Scale-Up
Shift Domestic-First Paradigm to Create Startup Ecosystem on Global Stage
Focus on Establishing Private-Led Venture Verification System and Strengthening Manufacturing Venture Capabilities

Kang Sam-gwon, Chairman of the Korea Venture Business Association, emphasized that while actively addressing regulatory issues in new industry areas such as telemedicine, he will also take the lead in supporting the scale-up (business expansion) of member companies using the private-led venture company verification system. Photo by Yoon Dong-ju doso7@

[Asia Economy Reporters Minjin Kim, Heeyoon Kim] “Compared to large corporations with inherent globalization capabilities, small and venture companies absolutely need institutional export support. Therefore, a systematic backing is necessary to provide coordinated policy support for the overseas expansion of domestic small and venture companies. A new direction for export and overseas expansion support must be established to foster the emergence of many unicorn companies with corporate values exceeding 1 trillion won.”

Kang Sam-gwon, Chairman of the Korea Venture Business Association, emphasized in an interview with Asia Economy on the 18th, “Thanks to the government’s venture promotion policies and investment activation, the ‘Second Venture Boom’ is becoming visible,” adding, “An ecosystem where our companies start up with the overseas market as their stage from the startup phase must be created.”

He also mentioned, “One way could be to make KOTRA, which helps small and medium-sized enterprises (SMEs) and mid-sized companies enter overseas markets, an institution under the Ministry of SMEs and Startups.” Chairman Kang stated, “Venture companies play a central role in our economy in terms of new job creation and sales,” and “Scale-up to grow startup ventures into unicorn companies is more important than ever.”

Having taken office on the 25th of last month to represent about 70,000 domestic venture companies, Chairman Kang stressed the importance of establishing a private-led venture company verification system alongside the Second Venture Boom. The private-led venture company verification system, which will be fully implemented this year, was transferred in February from public institutions such as the Small and Medium Business Corporation and the Korea Technology Finance Corporation to the Venture Company Verification Committee composed of private experts. Kang said, “It is significant that the venture industry directly verifies and evaluates venture companies with growth potential,” explaining, “Unlike the previous financial stability-centered guarantee and loan criteria, evaluation will be based on the technological and innovative aspects of ventures to select true ventures.”

He revealed plans to support the scale-up of member companies through the venture company verification system as his first statement after taking office. This is interpreted as the new chairman’s plan for the association to directly play a platform role that connects member companies needing cooperation beyond certification by the Venture Company Verification Committee, composed of private experts such as entrepreneurs, investment reviewers, and academia/research sectors, or to selectively support venture companies struggling to open sales channels.

Meanwhile, with Coupang’s listing on the New York Stock Exchange, the dual-class voting system has become an issue among domestic venture companies alongside the growth of domestic unicorn companies. Market Kurly, Yanolja, and Today’s House are mentioned as next candidates for direct listing in the U.S., dreaming of becoming post-unicorns. Last month, domestic video technology startup Hyperconnect attracted attention by being sold to U.S. Match Group for 2 trillion won just eight years after its founding. In the post-COVID era, as the hot Second Venture Boom emerges as the new normal of our economy, the role and responsibility of the Korea Venture Business Association are also becoming significant.

Below is a Q&A with Chairman Kang.

- Since taking office, you have emphasized global-oriented scale-up venture cultivation.

▲In Taiwan, the motto is to export unconditionally once a venture company is established. However, strangely, in Korea, there is a tendency to think of the domestic market first upon startup. Companies seek overseas expansion only after stabilizing their business through supplying to large corporations. I want to change this paradigm. As a senior entrepreneur and at the association level, I want to create a system that supports startups to grow as globally oriented companies from the startup phase.

- What kind of support does the association provide in this process?

▲We plan to introduce government policy support for areas where startups lack capabilities, including marketing, and provide various educational programs through cluster formation at the association level. In particular, we aim to build a win-win model between senior ventures, large corporations, and startup ventures. We expect unique synergy effects from the growth process through mutual growth. Since venture companies have emerged as leaders of a leading economy, I believe it is difficult for large corporations to grow independently without mutual growth with ventures and SMEs.

Kang Sam-kwon, Chairman of the Korea Venture Business Association, emphasized that through the private-led venture business verification system, they will play a 'platform' role by connecting companies that need cooperative relationships and selectively supporting companies struggling to open sales channels, going beyond simple venture certification. Photo by Yoon Dong-ju doso7@

- What policy is most needed in the venture industry now?

▲Regulatory reform. Following the 1990s venture boom, the current Second Venture Boom is accelerating, and regulatory reform is essential to lead and sustain this trend. Specifically, startup ventures in mobility, telemedicine, and O2O (online-to-offline) sectors face many difficulties in business growth due to regulations. Although there is the SME Ombudsman, it is insufficient according to voices from the field. We plan to unify the channel for collecting opinions on regulations through the association and actively respond to regulatory issues in new industry areas.

- The venture verification system attracted attention as it was transferred from public institutions to the association.

▲We are concentrating all our capabilities on the stable establishment of the private-led venture verification system. Previously, evaluations were conducted by public institutions such as the Korea Technology Finance Corporation and the Small and Medium Business Corporation, as well as the Korea Venture Capital Association. The private-led difference is that the Venture Company Verification Committee, composed of private experts including venture entrepreneurs, investment reviewers, and academia/research sectors, now conducts integrated evaluations. The Korea Venture Business Association serves as the secretariat of the committee and acts as the verification agency. The committee deliberates and decides on the innovation, technology, and growth potential of applicant companies. While previous evaluations focused on financial stability for guarantees and loans, the private-led verification system focuses on selecting true venture companies.

- You emphasized the role and importance of manufacturing ventures.

▲Recently, the venture industry is centered on platform services, while manufacturing ventures are being overlooked. In Korea, where manufacturing is a key industry, innovative hardware ventures must produce products to form a massive device ecosystem like smartphones. Manufacturing ventures require more than three times the initial capital compared to online-based ventures, so investment is also passive. I want to emphasize resolving this imbalance and activating support for domestic manufacturing ventures with global competitiveness. Overseas expansion of manufacturing ventures and other ventures is also a key focus area.

- What are your goals for this year?

▲As mentioned earlier, I plan to devote myself to supporting global scale-up, actively responding to regulatory issues, and establishing the private-led venture verification system. Additionally, we will newly organize practical benefits that association members can feel, enhance existing support projects in line with industry trends, and improve member satisfaction.

Interview by Minjin Kim, Head of Ministry of SMEs and Startups enter@asiae.co.kr

Summary by Heeyoon Kim film4h@asiae.co.kr

Who is Chairman Kang Sam-gwon?

▲ Seocheon, Chungnam ▲ Bachelor’s degree in Electronic Engineering from Wonkwang University ▲ Planning Department at Daeryung Precision ▲ CEO of Phinix System ▲ CEO of Point Mobile ▲ Former Vice Chairman and current Chairman of the Korea Venture Business Association