South Korea has a healthy and thriving startup ecosystem, and the capital Seoul is not only the business hub but also a breeding ground for innovations and creations. In its annual report on the global startup ecosystem, research firm Startup Genome named Seoul the 10th best city for startups.
The Global Startup Ecosystem Report 2022 by the firm, dedicated to improving the startup ecosystem of each city, surveyed 280 cities across some 100 nations for the latest results announced in London.
The report ranked Seoul as 10th strongest in the startup ecosystem category, up from 16th last year and 20th in 2020. So what makes Seoul one of the best cities in the world to launch a startup?
1.) Heart of startup activity in South Korea
More than 60% of startups in South Korea exist in Seoul, and out of the total 18 Korean unicorns, 15 are based here. The Startup Genome report puts the value of Seoul’s startup ecosystem at 223 trillion won (US$173.4 billion), sharply up from 54 trillion won a year earlier.
2.) Home to top Incubators centers & Accelerators
Seoul has more than 200 accelerators, and incubation centers, creating an ecosystem value of $5 billion.
3.) Host of global startup festivals & tech events
Seoul hosts global startup festivals like K-Startup Grand Challenge, COMEUP and numerous tech events.
4.) Head offices of the world’s leading corporate brands
More than 70% of the world’s largest corporate brands are in Seoul, including Samsung, LG, and Hyundai.
5.) Booming Venture scene
In 2021 VC funding increased by 34% compared to the previous year, to $7.7 billion. Venture investment in Korean startups grew 78% year-on-year in 2021 to surpass $6.4 billion. Seoul accounts for 56% of the total investment, hitting a record high.
6.) Smart city Seoul
Seoul has an optimal business atmosphere with a high-speed communication network (5G) and free public wifi.
7.) Advance R&D & technology facilities
Seoul was ranked the fourth-most active cluster in science and technology in 2021, according to the Global Innovation Index (WIPO). In 2019, Korea invested $102 billion in R&D, making it the fifth-largest spender among OECD countries.
8.) Evolved consumer market
Korea was ranked first in the population who attained tertiary education at the age of 25–34 among OECD countries in 2021. According to CNBC, Korea will be the third largest e-commerce market in the world in five years.
9.) Hub for talented human resource
Seoul is home to 54 universities, and the Seoul Metropolitan Government aims to foster 40,000 future talents by 2025 through Seoul Software Academy (SeSac), a technical training center.
10.) Major industrial clusters located here
Seoul has seven major industrial clusters such as Biotechnology (Hong-neung), AI and Big Data (Yangjae), Fintech (Yeouido), Robots (Suseo), and IoT (G-valley).
11.) World-class working spaces
There are over 100 coworking space providers, including WeWork and FastFive. Fab Lab, Seoul Startup Hub, Google Campus Seoul, Maru180, and more.
12.) Tax incentives & easy regulations
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 startups and entrepreneurs from abroad.
13.) Seoul government support
Seoul Metropolitan Government launched an investment promotion agency, Invest Seoul, in February 2022 to help international businesses successfully relocate to Seoul. The initiative will attract $30 billion in foreign direct investment by 2030. Seoul has also set up a startup ladder, a special plan for strategic collaborations between existing companies and startups.
- ‘2022 Seoul FinTech Lab Global Accelerator Program’ to support Korean startups reach global shores
- K-Startup Grand Challenge 2022: Startups grow your business in the world’s most tech-savvy country South Korea
- Venture investment in the Korean startup ecosystem for 1Q 2022 shows a record rise
- Foreign startups that are getting success in South Korea