[Changing the World M]⑦ Following the First Generation of Ventures, M Generation Entrepreneurs After 20 Years

Until the early 1980s, the icon of success was known as the ‘Seoul National University Law School.’ Regardless of the region, those who were considered academically accomplished all flocked to Seoul National University’s Law School, boasting the highest cutoff scores based on the College Scholastic Ability Test until 1984. However, a change occurred starting in 1985. Due to government-led policies focusing on the electrical and electronics fields at the time, talents began to gravitate toward departments such as Physics and Electronic Engineering. By 1986, this difference became clear, with the admission cutoff scores for Seoul National University’s College of Engineering, including Electronic Engineering, surpassing those of the Law School.

This also signaled the dawn of a new wave of change. The key figures of the ‘first generation of ventures’ who shaped the history of Korea’s internet and gaming industries?such as Kim Beom-su of Kakao, Lee Hae-jin of Naver, Lee Jae-woong of Daum, and Kim Jung-ju of Nexon?all emerged on the stage carrying the title of the ‘86 class,’ known as the golden generation. NCSoft CEO Kim Taek-jin, who graduated from Seoul National University’s Electronic Engineering department in 1985, attended school during the same period as them.

The 86 Generation Riding the Internet Era...Success as the First Generation of Ventures

Why does the ‘86 class’ stand out so distinctly? They were the first generation to freely explore the unknown world of the internet through computers. The late 1980s, when they were in their third and fourth years of university, marked the beginning of the spread of personal computers and the internet. Although it was difficult for households to own personal computers like today, universities provided computers that could access the internet.

For those who plunged into the new realm of the internet, every attempt was a first. Moreover, in the early 1990s, as domestic companies began to recognize the internet as a future industry, it was an ideal time to expand businesses. Many from the 86 class chose Samsung SDS as their first workplace for this reason. As the internet gradually became widespread and a new world opened, they began to dream of entrepreneurship even while working. By the early to mid-1990s, households started to own at least one computer.

Their dreams began to flourish in the late 1990s when the venture boom started. To overcome the 1997 foreign exchange crisis, the government began investing massive funds in nurturing venture companies during the late 1990s and early 2000s. Consequently, not only employees of large corporations curious about the internet but also graduate students, professors, and various other groups jumped into venture startups, rapidly increasing the number of IT companies.

Especially, this ‘first generation of ventures’ began to emerge as new powerhouses by surviving the collapse of many companies when the venture bubble burst, gradually expanding their territories. As of the 11th of this month, Naver’s market capitalization stands at 32.8918 trillion KRW, and Kakao’s at 25.0384 trillion KRW, ranking 11th and 13th respectively in Korea’s market capitalization rankings. Nexon, listed on the Tokyo Stock Exchange in Japan, has a market capitalization of 22.5506 trillion KRW.

From Mouse to Finger...‘M Generation’ Blossoms Mobile Startups

Now, it is the era of mobile. In the morning, people go to work at the shared office FastFive, booked via mobile; meals are ordered through the Baedal Minjok app or cooked with ingredients ordered from Market Kurly. After a night out with friends, they conveniently settle the bill through Toss, and when they return home, packages ordered from Coupang the day before greet them. On weekends, they rent a car through SoCar to go to the countryside and spend a day at accommodations booked via Yanolja.

Mobile-based services that emerged in earnest in Korea during the 2010s have deeply embedded themselves in our daily lives. Around 2008, in Silicon Valley, USA, the advent of the iPhone combined with abundant funding sparked the startup boom with companies like Groupon, Uber, and Airbnb. Korea’s startup trend coincided with this era, leading to the emergence of companies that achieved explosive growth in a short period, making the term ‘startup’ almost inadequate.

While the foundation of the existing first-generation venture companies was the internet world accessed via computers, the newly born ventures freely explored the mobile world where everything is done with a single finger, creating new value. Particularly, those with quick wit who solved everyday inconveniences with brilliant ideas and captured markets with great potential survived, earning the title of the ‘first generation of mobile.’

This mobile first generation mainly expanded their influence among founders born in the late 1970s, who belong to Generation X (born 1970?1979) but just before the Millennial generation (born 1980?1996, M Generation). Kim Beom-seok (born 1978) of Coupang, Kim Bong-jin (born 1976) of Baedal Minjok, Lee Soo-jin (born 1978) of Yanolja, and Ahn Sung-woo (born 1979) of Zigbang created massive platform companies. Following them, startups founded by those born in the 1980s, such as Lee Seung-gun (born 1982) of Toss, Kim Seul-ah (born 1983) of Market Kurly, and Cho Man-ho (born 1983) of Musinsa, also joined the ranks of unicorn companies.

A unicorn refers to an unlisted startup company valued at over 1 trillion KRW. The birth of unicorn companies is generally used as an indicator of how active the startup ecosystem is. According to the Ministry of SMEs and Startups, as of the end of December last year, there were 22 unicorn companies in Korea. Adding nine companies that were previously unicorns but are now excluded due to listing or other reasons brings the total to 31. Considering that there were only three unicorn companies in Korea in 2017, this represents an explosive increase of more than sevenfold in five years.

‘Prepared Entrepreneurs’ Equipped with Entrepreneurial Spirit and Data Analysis Skills

Recently, the rapid rise of young entrepreneurs known as the ‘late M Generation’ (born 1990?1996) has also been remarkable. Having grown up observing the mobile first generation such as Steve Jobs and Mark Zuckerberg overseas, and domestic companies like Woowa Brothers (Baedal Minjok), Coupang, and Viva Republica (Toss), they dream of becoming the ‘next unicorn.’

In particular, they openly understand that if they find items suitable for the smartphone era and succeed in entrepreneurship, they can accumulate great wealth at a young age. They do not consider blindly joining large corporations as the only correct path, unlike older generations. Some even accumulate entrepreneurial experience from their school days, becoming ‘prepared entrepreneurs.’

One such example is Lee Se-young (born 1996), CEO of AI portal service company Lytton Technologies (Lytton). Lee said, “From a young age, I read stories of successful entrepreneurs like Masayoshi Son and Chung Ju-yung as if they were biographies,” adding, “I was fascinated by how they overcame any hardship and adversity to solve problems, which nurtured my dream of entrepreneurship.”

In fact, he is known for having entrepreneurial experience since high school. In his second year, he created the ‘Korea Youth Academic Conference,’ a paper presentation event for high school students, which eventually grew to involve over 3,000 students from 13 countries. He established an office capable of accommodating 50 team members and 160 volunteers and even developed an online conference platform. Leveraging this experience, Lee became the CEO of Lytton, a startup with 40 employees, just two years after founding it.

Data-driven decision-making and rapid execution are also weapons possessed by the M Generation. Im Seung-jin (born 1990), CEO of the ready-meal startup Wingit, strictly adheres to a data-based approach when planning products. Wingit has structured its product launch process into 46 stages, which helped capture consumers’ tastes. The goal is to reduce the probability of failure through meticulous analysis. In fact, the repurchase rate of their services reaches about 70%.

“Expanding Beyond Korea to the World”…Future Unicorn Leaders in 10 Years

One notable characteristic of M Generation entrepreneurs is their ‘global mindset.’ They are more familiar with English than their parents’ generation and have less resistance to overseas expansion. Having easily accessed overseas SNS services like YouTube, Facebook, and Instagram since school days, and with increased opportunities for studying abroad and language training, cultural barriers have significantly diminished. Therefore, when starting a business, they do not focus solely on the Korean market but aim at the global market from the outset.

Classum, an education and knowledge-sharing platform dubbed the ‘Slack of education,’ offered both Korean and English versions from its initial launch. Lee Chae-rin (born 1996), CEO of Classum, said, “From the beginning of entrepreneurship, I had a vision to create a service used globally beyond Korea,” adding, “We focus on solving problems commonly shared by other countries beyond the domestic market.”

In fact, Classum is pioneering the market as a ‘first mover’ not only in Korea but also in the United States. Currently, universities and institutions such as California State University, Fresno campus, use Classum. It has also received a cumulative investment of 7.6 billion KRW from Silicon Valley’s Storm Ventures and Big Basin Capital. Recognized for such influence, CEO Lee was selected as one of ‘Forbes Asia’s 30 Under 30 Leaders,’ and CEO Choi Yoo-jin of Classum was named among HolonIQ’s ‘2023 EdTech Startup Women Leaders.’

The venture startup industry expects M Generation entrepreneurs with such backgrounds to become mainstream within the next 5 to 10 years. Jang Seung-ryong, director at Kakao Ventures, said, “They grew up watching successful startup cases from a young age and naturally nurtured dreams of entrepreneurship. With government grants and various support systems in place, the environment is favorable for challenges,” adding, “Since they can also learn know-how from entrepreneurial seniors who have tasted both success and failure, they are expected to achieve greater success than previous generations.”