A major tech conference, beGLOBAL San Francisco 2015, was held this month and offered an opportunity for Korean domestic startups to communicate with American investors. The conference provided American and foreign investors with substantive information regarding the Asian startup market. This was the 7th beGLOBAL startup conference since starting in 2012, with past iterations in both Korea and the US. To date, the event has been attended by 15,000 people from over 25 countries. To more than 4,000 startups, the event has become a critical global networking platform.
A number of Silicon Valley investors are focusing on South Korea, partly as a result of the conferences. Coupang, a burgeoning Korean e-commerce platform ranked first among the top 15 most-funded startups in South Korea, mainly depends on venture financing from the US. Additionally, CoinPlug and Korbit, rapid growing Korean Bitcoin startups, have raised funding from Silicon Valley venture capital companies. Fast-growing mobile platform Yello Mobile secured $100 million from Silicon Valley-based venture capital firm Formation 8. Recognizing the need to be near the action, branch offices of major tech firms have been established in Seoul, including Facebook, Uber, AirBnB, and Google. In May of 2015, Google launched a branch of its Campus program, its first in Asia, which supports the startup ecosystem in the area by offering co-working spaces, various programs, and office hours to consult with Google employees. The flow of investment has also gone in the opposite direction, as American game studio SGN received a $130 million investment from Netmarble Games, a powerful online game provider in South Korea.
South Korea has become so competitive in the tech sector mainly as a result of enormous public investment. In 2013, South Korean President Park Geun-Hye announced the desire for a more “Creative Economy” and launched the new Ministry of Science, Information and Communications Technology (ICT) and Future Planning (MSIP). In 2014, MSIP’s budget increased to more than $12 billion, with over $2 billion going directly into fostering a startup ecosystem. In addition, the country is blanketed with free Wi-Fi that provides with the world’s fastest Internet speeds—twice as fast as the average in the US. Reflecting these developments, Bloomberg News recently published the Bloomberg Global Innovation Index and ranked South Korea first, as the most innovative country in the world.
The government has also been making further efforts to organize startup growth through its $23 million K-Global initiative. Under the K-Global umbrella, a number of programs are connected with Silicon Valley. The K-Global Entrepreneurship Education program provides collaboration opportunities with Stanford University, offering their own Design Thinking program in a two-week course. The K-Global Startup Engine promotes promising Korean startups to notable startup accelerators such as 500 Startups and Alchemist Accelerator.
With strengthening cooperation and investment flowing in both directions, the US-Korea tech relationship is on track for continued growth and many new ideas and opportunities are expected.
Minseong Baek is a Research Intern at the East-West Center in Washington and an Asan Washington Young Fellow at Asan Academy in Seoul.