[Asia Exclusive] Kim Yong-moon, President of the Korea Institute of Startup & Entrepreneurship Development, "ESG Trend Brings Infinite Opportunities for Startups"

Eco-Friendly Seaweed Material Developer
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Should Be Viewed as Investment, Not Cost

Kim Yong-moon, President of the Korea Institute of Startup & Entrepreneurship Development, is being interviewed at Tipstown SI in Yeoksam-dong, Seoul. Photo by Kang Jin-hyung aymsdream@

[Interview = Kim Minjin, Head of the Ministry of SMEs and Startups, Edited by = Reporter Kim Bokyung] Kim Yongmun, President of the Korea Institute of Startup & Entrepreneurship Development (KISED), visits at least one company every week to communicate directly on-site. This principle stems from his philosophy that "the answer lies in the field." In a recent interview with Asia Economy at Tipstown SI in Yeoksam-dong, Seoul, Kim said, "We improved internal organizational systems to solve problems found on-site." For example, KISED formed a youth startup task force (TF) and introduced a 'startup look' dress code, allowing employees to come to work in comfortable attire. This year, the focus will be on generation-specific startups, global expansion of startups, and public-private collaboration programs such as TIPS. He also expressed the view that the global ESG (Environmental, Social, and Governance) trend could present unlimited opportunities for startups. The following is a Q&A with President Kim.

- How do you think the global ESG trend affects startups?

△ From the perspective of open innovation, ESG can act as an unlimited opportunity. Startups that excel in the ESG domain are seeing expanded opportunities for collaboration and investment with large corporations. Recently, SK Telecom and Kakao each invested 10 billion KRW to establish ESG funds, and Lotte Chemical also contributed 50 billion KRW to an ESG-dedicated fund.

‘Marine Innovation,’ which developed eco-friendly new materials from seaweed, received early-stage investment from SK Innovation, and ‘Superbin,’ which recycles PET bottles using AI robots, successfully attracted investment from GS Caltex. KISED is also exploring various support measures such as awarding outstanding companies and expanding cooperative projects to support startups in the ESG field. Although startups may face challenges in ESG management due to their scale, it is necessary to view ESG as an investment rather than a cost.

- Startup creation is gaining momentum. What are the key projects KISED will focus on?

△ We intend to focus on ‘generation-specific startups’ such as youth and middle-aged entrepreneurs, the ‘global expansion’ of domestic startups, and ‘public-private collaboration.’ In line with the newly established Youth Policy Division at the Ministry of SMEs and Startups, KISED formed a youth startup TF. We plan to work with the ministry to revitalize youth entrepreneurship. Young entrepreneurs we met on-site want opportunities to validate their business models. There is a need for a pre-school concept program where they can freely use even small amounts of funds to directly experience commercialization.

We are also reviewing ways to expand education and mentoring opportunities to support middle-aged entrepreneurs from the baby boomer generation. By systematizing global support projects, we aim to lay the foundation for startups to expand their stage to overseas markets and foster a healthy startup ecosystem through public-private cooperation methods such as the TIPS program.

Kim Yong-moon, President of the Korea Institute of Startup & Entrepreneurship Development / Photo by Kang Jin-hyung aymsdream@

Weekly Visits to One Company for On-site Communication
Focus on Generation-specific Startups and Global Expansion
Support Projects Including Collaboration with Large Corporations

- On-site voices suggest strengthening investment and support systems for startups in the growth stage, over three years after founding.

△ KISED provides customized support throughout the entire lifecycle of startups according to their growth stages. However, support for startups in the 3-5 year growth phase may be relatively insufficient. The most needed resource during the growth and leap stages is ‘funding.’ Considering that the cumulative venture investment in Q3 last year reached a record high of 5.2593 trillion KRW, the domestic investment market has grown, but there is an opinion that investment in growth-stage startups is lacking. Although seed investments have increased due to government and private efforts, it remains difficult to secure follow-up investments. When it is time to attract follow-up investment, products or services need to be on the market and evaluated to attract investor interest, but this often does not happen.

KISED is promoting projects such as the Startup Leap Package, Post-TIPS, and the establishment of the Korea Startup Center (KSC) to support the growth and leap stages. Various support projects, including market expansion through collaboration with large corporations and global partners, are also underway. For startups in the leap stage, it is more important to secure funding by expanding market channels and creating an environment where investments can be attracted through such references than general policy support.

- How do you evaluate the global startup festival ‘COMEUP 2021’?

△ COMEUP is a festival that promotes the domestic startup ecosystem worldwide and provides a venue for domestic and international startup stakeholders to exchange and collaborate. The offline event was safely held with visitors complying with COVID-19 prevention guidelines. More than 28,000 startup stakeholders, investors, and visitors attended, surpassing the 21,000 visitors in 2019. The conference, consisting of 12 sessions, was fully booked, and side events such as exhibitions and business meetings of 72 startups were bustling with attendees, concluding successfully.

Notably, 406 business matchings and investment consultations took place during the event, indicating a significant increase in investor interest in startups. This year, we will continue efforts to cooperate with countries worldwide and increase private sector participation to establish COMEUP as a global festival with many domestic and international startups participating.

- How do you communicate with startups?

△ To provide support services that startups need on the ground, we strengthened communication based on the belief that ‘the answer lies in the field.’ First, we established the ‘one company visit per week’ principle, holding startup meetings to identify difficulties and challenges. At a meeting with webtoon artists, we received requests for 3D printer support to commercialize created characters, and we decided to assist with 3D printer usage by linking with the ‘Makerspace’ operated by KISED.

Internally, we changed employees’ dress code to a comfortable style called the ‘startup look’ and enhanced internal communication. We fostered a horizontal and open organizational culture to establish ourselves as a partner to startups. This year marks the time to solidify our position as Korea’s top startup service support institution and begin a second leap forward.