Announcement of the 'Pan-Government Scale-up R&D Investment Strategy'
[Asia Economy Reporter Lim Hye-seon] The government plans to expand scale-up research and development (R&D) investment to 3.5 trillion KRW annually by 2027 to nurture 10 unicorn companies in the deep tech (advanced technology) sector. Scale-up refers to the process of expanding the level of technology and the size of companies, encompassing both technology scale-up, which advances laboratory-level technology, and corporate scale-up, which grows startups.
On the 12th, the Ministry of Science and ICT announced the "Pan-Government Scale-up R&D Investment Strategy" at the 16th Emergency Economic Ministers' Meeting held via video conference. The Ministry aims to create 10 deep tech unicorn companies by investing 15 trillion KRW over five years (2023?2027), setting four basic directions: expanding private sector participation, strengthening pan-government cooperation, diversifying corporate support methods, and supporting ecosystem-centered initiatives.
First, the government will focus funding on innovative companies within three years of establishment by utilizing policy funds linked to government R&D. Additionally, a National Scale-up Technology Strategy Center will be established to analyze R&D investment status and strengthen investment strategies, serving as a national think tank. Efforts will also be made to improve investment efficiency by applying sunset clauses to projects continued by convention or restructuring them.
Each ministry's technology database (DB) will be analyzed using big data and artificial intelligence to select promising technologies and build groups to share with the private sector. The Ministry of Science and ICT’s Future Technology Plaza, the Ministry of Trade, Industry and Energy’s National Technology Bank, and the Ministry of SMEs and Startups’ Tech Bridge are among the databases subject to analysis. Support for domestic and international patent applications and management will be strengthened to create globally excellent patents in national strategic technology fields.
A customized corporate R&D support system based on innovation capabilities will also be established. Moving away from support structures centered on company age and sales, an innovation capability diagnosis system tailored to each ministry’s characteristics will be introduced to provide support aligned with companies’ innovation capacities. Post-payment, competitive, and voucher-type R&D projects will be introduced, and the R&D cost burden ratio will be flexibly applied according to company size to reduce companies’ financial burdens.
Alongside this, a "Industry-Academia-Research Scale-up Valley" will be fostered, strengthening cooperation among regional research institutes, government-funded research institutes (GFRIs), and companies centered on regional hub universities.
Globally, there is a trend to strengthen support for deep tech and scale-up to enhance national competitiveness through nurturing deep tech unicorn companies. Boston Consulting Group forecasts that global deep tech investment will reach $140 billion by 2025, with investments concentrated in synthetic biology, new materials, and artificial intelligence sectors. In Korea, the link between R&D outcomes and economic results through technology commercialization is weak, and although the startup rate is high, the survival rate of startups is low. Korea’s startup survival rate is 63.6%, lower than Japan (95.3%), the UK (92.2%), and the US (79.1%).
Minister Lee Jong-ho of the Ministry of Science and ICT said, "It is time for us to leap forward as a scale-up powerhouse based on our R&D achievements and innovation capabilities. The government, private sector, and related ministries will work closely together to nurture promising technology seeds created through government R&D so that they can bloom into global unicorn companies."
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