According to the Ministry of SMEs and Startups reports from January 24th 2019, the most crucial elements of the Venture Fund market, 'new venture investments', 'venture fund organization', and 'total venture' were recorded as the highest in 2018.
New Venture investment was reported as USD 3 billion in 2018, showing that the investments have increased significantly by 43.9% compared to its highest record of USD 2.8 billion in 2017. New Investments, which are directly related to the sectors of the 4th Industrial Revolution, skyrocketed by 71.7% recording USD 1.1 billion in 2018.
Furthermore, the largest fund of funds of USD 800 million in 2019 were contributed in order to form a USD 2 billion funds for new ventures.
On top of its aims to change the financing structure of the startup ecosystem from loan-based to investment-centered, South Korea encourages the growth of the startup scene even further by endorsing tax breaks and incentives for angel investors and venture capitalists, tax benefits for mergers and acquisitions in the technology and R&D sectors, and improvements in Visa regulations for foreign startup and entrepreneurs.
South Korea encourages the growth of the startup scene by endorsing tax breaks and incentives for angel investors and venture capitalists, tax benefits for mergers and acquisitions in the technology and R&D sectors, and improvements in visa regulations for startup and entrepreneurs from abroad.
Korea has a phenomenal reputation when it comes to its potential for e-commerce thanks to the extremely high rate of smartphone usage in the country. According to CNBC, Korea will be the third largest e-commerce market in the world in five years, catching up with China and the United States. Coupang is a great example of this potential, having received a valuation of over USD 500 million.
Human capital can also be said to be one of the strong points of Korea’s startup ecosystem. According to Bloomberg, Korea has ranked second globally for education, and Korea already has the highest university and college matriculation rate among all the OECD countries. According to Startup RADAR, Korea boasts about 30,000 startups that employ over 100,000 people and have a better approach to entrepreneurship and business culture than major Korea companies like Samsung, Hyundai, and LG. Korea’s startup scene is attracting a large and diverse collection of investors, including Korea based funds as well as corporate VCs, Silicon Valley venture firms, and more.