Finding a way through the financial crisis, 2007-2012

The financial crisis that began in the United States in April 2007 was one of the most dramatic events in the history of global capitalism. In its aftermath, the world economy was forced to go through the Great Recession. The period before and after the crisis brought about a profound change in the global economy. Few countries, both developed and underdeveloped, had fully recovered.

In Korea, the venture industry became an exit strategy to overcome the crisis. Korean venture companies have expanded to all corners of the world, with IT companies leading the way. Korea's brand premium in the process of overcoming the financial crisis, market development efforts based on the confidence of 'can-do', and bold support from the government had put us at the forefront of the 'post-crisis future market development'.

1. Relocation of Venture Business Association to Guro Digital Complex and Expansion of SVI

At the end of December 2006, the Venture Business Association ended the Tehran Valley era in Gangnam and moved to the Guro Digital Complex. It moved out of the Korea Technology Centre Building in Gangnam, Seoul and relocated its secretariat to Guro Digital Complex in Seoul and opened the 'Guro City' in January 2007.

Guro was once an industrial complex focused on textile and sewing industries for export in the 1960s, but since the 2000s, companies in high-value-added industries have moved in, and the number of high-tech companies in IT, bio, nano, and other industries has increased significantly. The relatively low rent, comfortable office space, and geographical proximity to manufacturing plants attracted venture firms. By 2006, more than 6,000 venture companies had moved into the Guro Digital Complex, making it the most popular place to start a venture company at the time.

Around this time, Seoul Venture Incubator (SVI) was selected by the Small and Medium Business Administration as a 'BI expansion business' and moved from Seocho-dong, Seoul to Guro. In order to work more closely with the many venture companies in the Guro Digital Complex, SVI moved together with the Venture Business Association to conduct various support projects.

Having SVI and the Venture Business Association in one place had a great synergistic effect. In particular, the networking between the growth venture companies of the Venture Business Association and junior venture companies that had just started their business had been facilitated, accelerating the discovery and development of innovative entrepreneurs, which was the original purpose of SVI. As a result, the SVI has been able to fulfill its role as a mutually beneficial venture platform where junior companies can learn from the success of senior companies and senior companies can learn about innovation trends through junior companies.

Since its opening in 1999, SVI has been working as a 'venture startup helper' until 2019. With the strength of its network, especially the Venture Business Association, SVI had become a window for senior venturers to share their rich experience and know-how with younger entrepreneurs. The various experiences of the seniors, who went through numerous trials and errors and difficulties when there were no systematic entrepreneurship education institutions, helped the juniors to start their own businesses efficiently.

SVI's entrepreneurship education, which had already been passed through by more than 300 entrepreneurs, consists of three stages: 'Mock Startup', 'Business Model Development', and 'Actual Startup (Mini MBA)'. It was designed to enhance the ability to minimize risks and seize opportunities based on the successes of our seniors, and in a nutshell, to start a venture with strong fundamentals.

SVI was committed to not only supporting startups but also improving the quality of the entire venture. SVI was also committed to protecting entrepreneurs from crises. This was because the ultimate goal of SVI was to create a healthy entrepreneurial ecosystem. That's why we call SVI the public school of venture.

2. Extension of the Special Measures for Venture Business Development Act & Preparation of the 2nd Venture Roadmap

In early 2007, the Small and Medium Business Administration (SMBA) initiated policy actions to create a second venture boom. By the end of February that year, it decided to extend the Special Measures for Venture Business Development Act (hereinafter referred to as the Venture Special Act) for 10 years, establish a roadmap for the second venture policy period, and completely revise and supplement the Venture Act. The Venture Special Act, which had been in effect since 1998, had achieved results such as revitalizing investments in seed funds, and its extension was promoted as it was feared that if it was abolished, the support for innovative companies would be lost and the dynamism of the venture ecosystem will be hindered.

The amendment to the Venture Special Act, including a 10-year extension of the existing special act, was passed by the National Assembly in July 2007 after a cabinet meeting, laying the foundation for venture support policies for the next 10 years. The new venture law extends the validity period by 10 years and eases the requirements for mergers and acquisitions (M&A) between companies in order to encourage the domestic venture industry to enter the mature stage.

The SMBA had added new technology business investment associations to the list of parent associations in order to increase the amount of venture capital available under the new law. The M&A system has also been significantly revised. The scope of the simplified share exchange and merger procedures had been expanded from existing unlisted venture companies to unlisted start-up companies within seven years of establishment. In addition, the requirements for the small merger system, which allows the board of directors to approve a merger without holding a shareholders' meeting, had been reduced from 5 % to 10 % of issued shares and the merger grant from 2 % to 5 % of net assets for unlisted venture companies. The requirements for the simplified merger system had also been relaxed from 90 % of the total number of shares outstanding to 90 % of the voting shares. The government-led Venture Business Promotion Committee had been abolished, but the SMBA had decided to reorganize it into a market-oriented Venture Industry Development Committee.

The second round of measures to foster venture firms was launched in early December 2009. The plan reflects the government's determination to create a venture boom to boost economic growth and revitalize the job market. It encompassed measures to foster venture companies, including a plan to create a private venture fund worth 3.5 trillion won ($3.5 billion) and a technology development support program with a government budget of 600 billion won.

The focus of the measures was on green technology and entrepreneurship. While the "first venture boom" in the early 2000s was centered on the information technology (IT) sector, the second period was to utilize new industry ventures such as green technology and IT convergence technology as new growth engines.

Accordingly, the Small and Medium Business Administration planned to create a venture fund worth KRW 3.5 trillion, including KRW 1 trillion in 2010, KRW 1.2 trillion in 2011, and KRW 1.3 trillion in 2012, through a combination of parent funds and private funds. However, in order to reduce the private sector's dependence on the government, a system of limiting investment in parent funds was introduced. The SMBA had also decided to introduce a hybrid investment system linked to start-up guarantees to promote investment in start-up companies. With the introduction of this system, venture capitalists can invest more than twice the amount of the guarantee in corporate bonds (CB, BW) using the technology evaluation guarantees issued by the Technology Guarantee Fund as collateral.

It also included a plan to foster ventures centered on new industries such as green technology and IT convergence technology. The SMBA had designated 50 items and 117 technologies, mainly parts/materials, with high potential for short-term commercialization and import substitution as promising green fields for SMEs/venture companies, and plans to identify and foster 1,000 green specialized venture companies by 2013.

A re-challenge program had also been established to utilize the technical and management skills of failed entrepreneurs as social assets. The Small and Medium Business Administration announced a policy fund of 20 billion won in the first half of 2010 to support the restart of failed businesses without intentional intentions. The program will provide an average of 200 million won per person, but up to 1 billion won for entrepreneurs with a high potential for rebirth.

In addition, the government will activate the exemption from a joint deposit of policy funds of the Small and Medium Business Corporation, which had been in pilot operation, and consider introducing a joint guarantee exemption for those who pay additional interest on loans or provide stock options or technology and patent collateral.

Measures to expand the base of technology startups were also proposed. The SMBA will provide in-house and spin-off founders with expert start-up consulting and priority access to incubators, and will also ease regulations to promote spin-offs and recognize them as small and medium-sized enterprises even if the shareholding ratio of a large company (parent company) exceeds 30 % unless it was the largest shareholder.

The Small and Medium Business Administration had proposed a plan to create 10,000 ventures and 30,000 jobs over the next three years by leveraging the startup capabilities of universities and research institutes, including incubators and laboratories.

3. Fostering one-person creative companies

A one-person creative enterprise was literally a one-person-oriented business run by a person with creative ideas, skills, and expertise. It was characterized by its high economic added value and job creation effect compared to other industries. As a result, many countries around the world have been implementing policies to foster creative one-person companies. Silicon Valley, the heart of the US venture industry, had seen a boom in creative one-person startups, which had led to a decrease in unemployment in the region. Germany had also launched a program to support one-person companies to solve the unemployment problem and create jobs after reunification. In Korea, as youth unemployment became a major issue in the country, the president announced his intention to foster one-person creative companies as a solution to job creation in early 2009.

Professor Lee Jang-woo of Kyungpook National University, who was a member of the President's Council for Future Planning at the time, first proposed the concept of one-person creative enterprises academically and included a statement in his 2009 New Year's address that he would create a policy to support even grandmothers who were master Korean chili paste makers to start their businesses as one-person creative enterprises. Professor Lee Jang-woo contributed to the government's adoption of the one-person creative enterprise policy for the creative economy based on his experience in venture policy research and advice from the venture industry, including the honorary chairman of the Korean Venture Business Association.

The government had set a plan to foster 30,000 one-person creative enterprises as new growth engines for the 21st century by 2012. The plan was to transform the national economy into a high-value-added creative economy by using creative talents to promote the development of new products and induce the start-up of high-tech companies. The government also planned to induce the growth of the knowledge service industry, where this creative class was active, to improve the global competitiveness of other industries such as manufacturing.

IT, design, and cultural content were the main targets of support. To this end, the Small and Medium Business Administration collected ideas through a network linking the government's community centers/citizen service information system and private portal sites and operated an 'idea discovery team' that visited vulnerable groups on the Internet.

Up to KRW 100 million was provided for technology development projects linked between outstanding one-person creative companies and SMEs. In order to secure self-sustainability after start-up, the government relaxed the criteria for participation in public procurement for one-person creative companies and provided vouchers to SMEs that outsource design, translation, etc. to these companies, up to 10% of the contract cost (up to a maximum of KRW 3 million).

In May 2010, the Small and Medium Business Administration launched measures to foster mobile one-person creative companies. The agency designated 11 app creation centers nationwide, including Seoul National University, to foster app professionals, and provided support for app developer training, technology development, mentoring, community, and information provision. The SMBA also signed a memorandum of understanding with SK Telecom and KT, two of Korea's leading telecommunications companies, to foster mobile one-person creative enterprises, and provided free training from top-notch experts to outstanding graduates of the app creation centers.

Systemic innovations were also made to promote one-person startups. The Small and Medium Business Administration expanded the scope of tax breaks and improved the system so that one-person creative companies were not subject to heavy registration tax even if they were established in large cities. Previously, under the Local Tax Act, they had to pay three times the registration tax to register as a corporation in large cities. The SMBA had also proposed amendments to the Commercial Code to simplify the process of establishing a small corporation by lowering the minimum capital requirement, thereby easing regulations that hinder solo entrepreneurs.

In the second half of 2010, the SMBA decided to enact the 'Act on Fostering One-Person Creative Enterprises' to lay the institutional framework for promoting the start-up and growth of one-person creative enterprises. This was because the SME Act was previously focused on small and medium-sized enterprises such as urban and retail businesses and the manufacturing industry, and was limited in its ability to cover policies specific to one-person creative enterprises operating in the knowledge service sector. The law defines the legal concept of a one-person creative enterprise and includes a comprehensive plan, survey, and support program to foster such companies.

In addition, the government worked with local governments to designate additional "one-person creative enterprise business centers," which were currently operating in 18 locations nationwide and jointly held a one-person creative enterprise app development contest to promote the development of one-person creative enterprises.

In April 2011, the Act on Fostering One-Person Creative Enterprises was enacted, and in October it was fully implemented. In order to support one-person creative enterprises, the government decided to include co-founded companies in the category of one-person creative enterprises and to maintain support for one-person creative enterprises for three years if they employ full-time workers.

In 2012, a new R&D budget of KRW 2 billion was established for one-person creative enterprises, and plans were made to expand mentoring programs for them in the fields of technology and management. The government expects to increase the number of one-person creative enterprises from 240,000 in 2010 to 300,000 in 2013 and create more than 20,000 jobs annually by supporting one-person creative enterprises.

4. 102 venture-billion companies were born

In 2007, 102 venture companies with sales of more than 100 billion won were born. The Small and Medium Business Administration and the Venture Business Association held the 'Venture 100 Billion Club' event in June 2007 at the Diamond Ballroom of the Intercontinental Hotel, COEX to celebrate the birth of 102 companies with sales of more than KRW 100 billion. The 'Venture 100 Billion Club' was established in 2005 to disseminate success stories of venture companies, share experiences, and build a network of venture entrepreneurs. The number of venture companies with sales of KRW 100 billion or more increased from 68 in 2005 to 78 in 2006 and 102 in 2007, an average annual increase of 22.5 %. With three companies worth more than KRW 500 billion, this was the best report card for ventures since 2005.

There were three ventures worth more than 500 billion won, including Humax, DSLCD, and NHN; four ventures worth more than 300 billion won, including SFA; and 95 ventures worth more than 100 billion won, including MC Electronics. For the third consecutive year, 21 ventures joined the KRW 100 billion club, including Nepass, and 34 new companies joined the club, including UITI, and Humax recorded the top spot in sales for the third consecutive year.

Given that the history of Korean venture firms was only about 10 years old, the 102 companies in the KRW 100 billion club was considered a significant achievement at a time when corporate morale had been low due to the 'Sandwich Korea' controversy. In the early days of the venture, negative views of the venture were prevalent due to the occurrence of the venture bubble, such as 'pattern-only venture' and 'don't ask, don't tell investment', but since 2003, the country had overcome the bursting of the IT bubble and maintained a solid growth trend in venture economy indicators such as the number of venture companies, venture investment amount and KOSDAQ index.

The creation of 102 companies in the Venture 100 Billion Club reaffirmed the role of venture firms in economic growth and job creation and showed that they had realized significantly higher growth rates in terms of sales and employment than large and medium-sized enterprises. Sales of KRW 100 trillion, exports of USD 10 billion, and year-on-year sales growth of 14 % (2004 vs. 2005) were achieved. The employment growth rate between 1998 and 2005 was 23.9 % for ventures compared to 5 % for large and medium-sized enterprises.

By playing a crucial role in creating jobs for master's and doctoral-level science and technology personnel through the promotion of technology startups and stock options, venture companies presented a new corporate growth model that allows them to grow into large companies as independent companies.

The achievements of venture companies greatly raised the need for the extension of the 'Special Measures for Fostering Venture Companies' (Venture Special Act), which was the basis of venture growth support. The Venture Special Act, which had been in effect since 1998, expired in 2007, and a 10-year extension was promoted. The extended Venture Special Act contained provisions necessary for venture companies to grow into major players in the market, including various tax incentives that enabled the growth of the Guro Digital Complex, expansion of the secondary market, the basis for M&A, and the legal basis for utilizing the expertise of research institutions such as universities.

5. Merger of the Venture Industry Association and the Korea IT Business Federation

In August 2008, the Venture Industry Association and the Federation of Korean IT Companies, two organizations that had represented the venture industry in Korea, became part of the same family. In July 2008, the Korea Venture Industry Association (KOVA, Chairman Baek Jong-jin) and the Korea IT Business Association (KOIBA, Chairman Seo Seung-mo) signed an "Integration Agreement" to promote the merger. At the time, the Venture Industry Association said, "As the internal and external business environment surrounding venture companies was rapidly changing, we had unified to unify the government window for improving the venture business environment and strengthen services to member companies," while the Korea IT Business Association announced, "We had unified to promote exchange and cooperation between technology-innovative companies such as IT and bio, and to combine our capabilities in creating new markets through convergence with traditional industries." The two organizations had decided to call the new entity 'Venture Industry Association', reflecting their intention to maintain the unique identity of venture companies and become an umbrella organization representing more than 34,000 venture and IT companies.

The new organization plans to gradually integrate similar venture-related industry-specific associations and regionally based associations. The two organizations had jointly agreed that: -The members, secretariat personnel, and assets of the two organizations will be automatically inherited at the time of integration; - The transitional period of the integrated organization will be until the general meeting in February next year; - The chairmen of the two organizations will serve as co-chairmen during this period; - The number of executives will be no more than 100, and the specific details such as the composition of the executives will be reasonably adjusted between the two organizations; - The government-commissioned projects and in-house projects currently being promoted by the two organizations will be gradually inherited. However, in consideration of external contractual relations such as government projects, it was decided that the business and budget of the secretariat of the two organizations would be operated as an independent accounting system until the next annual general meeting of the combined organization.

Accordingly, the two organizations held a joint extraordinary general meeting on 20 August 2008 and declared the integration of the organizations. The two organizations, which were previously affiliated with the Ministry of Trade, Industry and Energy (Venture Business Association) and the Ministry of Information and Communication (IT Business Association), had been promoting the integration in line with the government reorganization. This was a reflection of the government's intention to unify the support channels for venture companies, as the support channels were not as different as in the past.

The two organizations had been operating as separate economic organizations, representing 30,000 venture companies and 20,000 IT companies, respectively, but the merger was inevitable in the new economic environment as their respective ministries were merged. With the merger, the two organizations grew in size and expanded their status to become the sixth organization after the five economic organizations, including the Federation of Korean Industries, the Korea Chamber of Commerce and Industry, and the Kyungchong, and laid the foundation to actively respond to the 'New IT Strategy' and 'Second Venture Policy' of the Ministry of Knowledge Economy and the Small and Medium Business Administration.

With the integration, the association had set out a vision to contribute to the creation of 10,000 jobs a year, centered on its 3,200 members. By creating quality jobs, the association would take the lead in reviving the Korean economy, which was experiencing severe unemployment.

1) From the Founding to the Integration of Korea IT Business Association (KOIBA)

KOIBA was founded on 26 July 1996 as the 'Council of Promising Information and Communication Companies for the purpose of technology exchange and cooperation among information and communication ventures. On 28 August 1997, it was merged with the Korea Association of Information and Communication Small and Medium Enterprises to form the Korea Information and Communication Small and Medium Enterprises Association.

In July 2001, the organization was expanded and renamed as the Korea IT SME & Venture Business Association (PICCA), and in March 2005, it was renamed as the Korea IT SME & Venture Business Association (KOIVA). KOIBA held its annual general meeting at the end of March 2008 and changed its name to the Korea IT Business Association (KOIBA). KOIBA changed its name to re-establish its status as an umbrella organization for the IT industry after the government reorganization changed the ministry in charge from the Ministry of Information and Communication to the Ministry of Knowledge Economy. Five months later, it merged with the Venture Industry Association and disappeared into history.

2) Discussion of merging venture organizations such as the Korea Women's Venture Association

During the Lee Myung-bak administration, there were calls to unify venture-related associations that were divided into the Ministry of Information and Communication, the Ministry of Trade, Industry and Energy, and the Small and Medium Business Administration. At the time, there were about 40 venture-related associations and organizations by industry and region. It was pointed out that the services provided to members differed depending on the nature and function of the organization, but there were many similarities.

As a result, in early 2008, the Korea Venture Industry Association (KOVA) (now under the Ministry of Knowledge Economy), the Korea Bio Association, the Korea Women's Venture Association, the SME Technology Innovation Association (InnoBiz Association), and the Korea Venture Capital Association (now under the Small and Medium Business Administration) were targeted for consolidation. The reason for this was that there was a lot of overlap due to the policies of the previous government to foster innovative companies.

Eventually, the Korea IT Business Association (KOIBA) merged with KOVA when the Ministry of Information and Communication was absorbed into the Ministry of Knowledge Economy. Within the Ministry of Knowledge Economy, overlapping associations were also merged. In November 2008, the Korea Bio Industry Association, the Bio Venture Business Association, and the Biotechnology Research Association, three organizations under the Ministry of Knowledge Economy, merged into the Korea Bio Association. However, a number of associations remained without a unified ministry. The InnoBiz Association and the Korea Women's Venture Association, both under the Small and Medium Business Administration, were discussed for the merger, but the deal fell through. In the case of the Korea Women's Venture Association, there was an element of waste due to overlapping functions between the two associations, but there was also a strong argument that it was necessary to protect the rights and interests of women in society.

The Korea Women's Venture Association was established in 1998 under the Act on Supporting Women's Business Enterprises. It had become the largest representative organization of women in the business world in a decade, with more than 400 members, second only to the Korea Businesswomen's Association. Its members were mainly IT entrepreneurs, including software and patent inventors.

KOVA and the InnoBiz Association, which had different umbrella organizations, had similar functions, so the need to merge them was raised. The InnoBiz Association was established in 2002 after the introduction of the InnoBiz certification system in 2001. Although it had a shorter history than KOVA, which was established in 1995, the number of members and certified companies had increased every year, making it an association that stands shoulder to shoulder with KOVA, so artificial integration was not an easy task. There were also many voices within the government that said that integration should be left to the autonomy and judgment of the associations.

6. Published a white paper on venture company social contribution survey

The Venture Business Association publishes the Social Contribution White Paper every year, which contains the social contribution activities of venture companies, and at the end of the year, the Venture Social Contribution Company and Venture Social Contribution Person Awards were established and awarded. In particular, the 2009 white paper included changes in venture companies' social contribution activities over the past five years by re-running the online survey on venture companies' social contribution activities conducted in 2004.

According to the results, 62 % of venture firms responded that they had participated in social contribution activities since their founding, compared to 35 % in 2004, indicating that many venture firms were interested in and engaged in social contribution activities.

In terms of the types of social contribution activities, cash donations were the most common form of social contribution with 46.4 % of respondents. The proportions of non-cash and cash donations were similar, with 21 % volunteering, 15 % donating in-kind, and 5 % providing services and technical support. The proportion of cash donations from venture firms had been increasing significantly in this sector, and the proportion of volunteering had grown significantly. This shows that venture firms were actively engaged in social contribution despite their relatively limited time and financial resources.

In its 2009 Social Contribution Survey White Paper, the Venture Business Association concluded that venture companies' social contribution activities were based on the spirit of venture sharing, recognizing social contribution activities as part of their social responsibility, actively participating in them, and practicing venture sharing activities in various financial resources and forms.

7. Launch of the Global Mid-Sized Venture Forum

Small and medium-sized venture companies had united to restore the crisis-ridden venture ecosystem and expand overseas. In January 2010, 36 venture companies that were recognized as strong companies in the global market held the founding meeting of the Global Mid-Sized Venture Forum at Bitplex in Wangsimni Station, Seoul, and officially started their activities.

The forum companies were led by members of the 100 Billion Club with sales exceeding KRW 100 billion and decided to hold regular meetings at least once a month to focus on the challenges of small and medium-sized ventures, suggestions to the government, and ways to promote joint industry projects. The government and academics also participated as members to help foster venture companies. In particular, the Small and Medium Business Administration, which was preparing measures to foster global venture companies, decided to use the Global SME Venture Forum as a representative private window. The Global SME Forum was launched because the role and activities of the Venture 100 Billion Club were not well known, and there was a consensus that as the role and status of SMEs grow, it was necessary to establish a window to properly convey their voices.

Despite the rapid growth in sales and assets through their hard work, MVCs had been facing difficulties in competing with global corporations, which were considered conglomerates and therefore fell into the blind spot of government tax benefits and funding. After the formation of the forum, the participating companies decided to more actively enter overseas markets.

Most of the venture companies were facing the limitation of not being able to grow into global companies because their sales structure was domestically oriented. While the number of venture firms had been increasing, their share of total exports had been declining. From 3.6 % in 2005, the share of venture firms' exports fell to 3.4 % in 2006 and 3.1 % in 2008. At that time, the Small and Medium Business Administration analyzed the management characteristics of venture firms by stage of internationalization and found that 63% of all firms were completely domestic firms that did not export or go overseas. In addition, 22.1% of the companies were simple exporters that only exported overseas without directly entering the market, indicating that the level of internationalization of venture companies was not high.

Even among the ventures that had entered overseas, only 15% of them had entered the full-fledged globalization stage. Despite having world-class technology, venture firms were unable to break out of the domestic market.

8. ICT Venture Forum

In May 2012, the Venture Business Association launched the ICT Venture Forum (then called the IT Venture Forum) to secure competitiveness in the smart environment and discover new business models. The ICT Venture Forum was formed by strengthening the function and organization of the 'IT Love Room', a social gathering of CEOs of IT venture companies. The IT Love Room was an informal gathering of members of the IT Venture Federation, which merged with the Venture Business Association in 2008. About 20 people attended the meeting, and it was officially launched as a forum with additional representatives of IT venture companies as members.

At that time, many IT ventures were suffering from poor performance. Despite the great opportunities of the smart environment, many companies were actually losing work. The lack of information in the industry and government policies that failed to proactively respond to changes in the new business environment were cited as factors.

The ICT Venture Forum was launched to improve these limitations. The forum aimed to go beyond industry information exchange to discover new growth engines and reinvigorate the IT ecosystem with policy proposals and proposals. In particular, while the Global Mid-Sized Venture Forum, which was launched in 2010, served to share policy proposals for mid-sized ventures to leapfrog companies and know-how to explore overseas markets, the ICT Venture Forum, a relatively small venture group, aimed to create business synergy among its members. "If the Global Venture Forum was a gathering of large-scale venture companies, the ICT Venture Forum was a gathering of smaller ventures looking for sustainable growth," said Park Kio Welgate, the first chairman of the forum, at its launch.

The ICT Venture Forum also served as a forum for industry grievances and policy opinions. After the IT Venture Federation merged with the Korea Association of Venture Businesses, it was not easy for the IT venture industry to voice its own opinions at the association level. The ICT Venture Forum held a steering committee meeting once a week to receive input from members. Technology suggestions were made, and there were talks about establishing a culture of getting paid for software (SW). Manpower issues such as military service exemptions and technology leakage from large companies were also raised. The ICT Venture Forum proposed policies based on these voices.

9. Launch of the Korea Youth Entrepreneurship Foundation

The Korea Youth Entrepreneurship Foundation was officially launched in March 2011 to foster youth ventures and spread innovative entrepreneurship. On 10 March 2011, the Small and Medium Business Administration and the Korea Youth Entrepreneurship Foundation held the 'Youth Venture Entrepreneurship Competition' at Dongguk University in Seoul, Korea, including the launching ceremony of the Youth Entrepreneurship Foundation and the inauguration of the Entrepreneurship University. The Youth Entrepreneurship Foundation was a private, non-profit corporation led by small and medium-sized venture capitalists and was created to serve as a backbone organization to discover and support the Korean version of Mark Zuckerberg.

The Foundation had identified four key areas of focus: entrepreneurship education, research, incubation, and infrastructure creation. In 2011, the foundation held 800 special lectures on entrepreneurship for 110,000 people and plans to expand awareness of entrepreneurship by holding roadshows combined with policy briefings.

The Youth Entrepreneurship Foundation, in particular, had decided to foster young entrepreneurs by running the '1 Company 1 Dream' program to produce new ventures. The program selects prospective entrepreneurs under the age of 30 connects them with senior entrepreneurs and sponsors them to conduct simulation activities.

The Youth Entrepreneurship Foundation also announced that it will focus on systemizing the domestic entrepreneurship agenda by conducting a domestic entrepreneurship survey, developing an index, and conducting international comparative research. To foster practical startups, the foundation also plans to create an angel matching fund by identifying companies willing to invest in angels and promising investment targets and to create related infrastructure such as overseas exchanges and sponsoring participation in international events.

The operational vision of the 15 leading universities was also revealed. In collaboration with the Foundation, the universities will serve as regional hubs for the spread of entrepreneurship, providing a shortcut for young people to reach successful entrepreneurship more safely and quickly by supporting them from the discovery of talented prospective entrepreneurs to start-up preparation and post-start-up growth.

The university was designated as the implementing agency for the technology startup revitalization support project, and the university began to provide support for startup courses, startup clubs, technology startup academies, and startup manpower projects that were supported individually. To this end, a budget of 30.5 billion won was invested in 2011 to support startup pioneer universities, and universities were also required to invest more than 10 % of the government funding to run their own programs other than government-supported projects. The 15 leading universities selected by the Small and Medium Business Administration with the launch of the Youth Entrepreneurship Foundation were Dongguk University, Yonsei University, Induk University, Hoseo University, Incheon University, and Kangwon National University.

10. 20,000 venture companies surpassed

The number of venture companies in Korea exceeded 20,000 in May 2010, 12 years after the introduction of the venture verification system in 1998. The number of domestic venture firms reached 11,392 in 2001 during the venture boom but fell to around 7,700 in 2003 due to the IMF foreign exchange crisis and the bursting of the IT bubble. However, after rising to 12,218 in 2006, the number of startups in Korea exceeded 20,000 for the first time in history with 20,044 in 2010, following 18,893 in 2009.

In particular, the number of start-ups increased by 3,492 in 2009, representing a year-on-year increase of about 23 %. The increase was mainly due to the improvement of the start-up environment by expanding policy funds, fostering start-up companies, and promoting green growth industries.

When looking at the distribution of venture firms by region, the Gyeonggi region accounted for 29 %, followed by Seoul at 22 %. Seoul and Gyeonggi were home to more than half of all venture firms.

By industry, manufacturing accounted for 75% of the total, followed by information processing and software at 13%. In terms of age, 49 % of the representatives were in their 40s, 26 % were in their 50s, 17 % were in their 30s, and 0.7 % were in their 20s, indicating that older entrepreneurs were more active than younger ones.

In late 2009, the government announced the 'Plan to Foster the Second Venture Boom' to support venture startups. The idea was to expand venture investment by utilizing green technology as a new growth engine for ventures. This included spreading youth entrepreneurship and supporting in-house start-ups and spin-offs of large companies and successful venture firms to expand the base of technology start-ups.

11. Startup Promotion Activities

The Start-up Venture Forum, a community of prospective and early-stage entrepreneurs, was launched in July 2011. The forum was created to create a better venture ecosystem by connecting senior entrepreneurs with early-stage entrepreneurs to help them overcome the difficulties they face in the early stages of starting a business. The Venture Business Association and the Korea Women's Venture Association held the launching ceremony of the Startup Venture Forum on 15 July 2011 at the first anniversary of the 'Venture 7 Days Market' held at Kyungwon University Vision Tower.

The Startup Venture Forum was established in response to the public opinion of entrepreneurs about the launch of a community of startup companies while operating the Venture 7 Days Market for one year in 2010 and was launched with the plan to operate it as a representative gathering of prospective and early founders who will lead the next generation of venture industry.

In particular, we decided to focus on strengthening exchanges between companies in order to solve the difficulties experienced by early founders. In addition to exchanges between startup companies, we decided to make more efforts to organize exchanges where they can communicate with senior entrepreneurs and get advice.

Startup Venture Forum had set the first direction of its activities to prevent inexperienced young entrepreneurs from repeating the mistakes made by senior entrepreneurs. To this end, the forum decided to build a business network and organize many exchanges so that young entrepreneurs can receive mentoring. They also decided to make efforts to provide support to their seniors on funding, legal matters, and global expansion, and to make recommendations to the government on the proper conduct of startups through the Venture Business Association.