The Second Hallyu Wave (Part 1)
Move over K-Pop, the Startup is Korea’s Next Great Export
Korea? You mean South Korea, right?
Why Korea? Why not move back to San Francisco? That’s where all the startup work is anyway.
Do you even speak Korean? Isn’t it risky moving to a country where you can barely communicate with your coworkers?
As I approach the conclusion of my first year in Korea, I reflect back on the three main responses I got when I told people I was packing up my comfortable life in America to move halfway across the globe to Seoul, South Korea.
I wasn’t moving here to teach English or go to school but rather be one of the first members of an early stage startup.
This move was not some impromptu, rash decision to tackle an early onset mid-life crisis but rather a highly calculated move revolving around my belief that South Korea will become, not only, the startup hub of Asia but will rival Silicon Valley as the place to be for entrepreneurs.
Let me repeat that:
In the next five to ten years, Seoul will be on equal footing with Silicon Valley.
*pause for dramatic effect*
What’s your evidence? Your gut feeling? This seems fishy.
This isn’t some gut feeling of mine but rather something that is readily apparent after looking at all the variables at play here which are listed below:
- Government Backing
- Migration of Younger Koreans
- Evolution of the Korean Mindset
- Concept of the Struggle
- Technological Dispersion
- Nationwide Educational Attainment
Because this is far too much to cover in a single blog post, I’ve broken these down into three separate blog posts. This first one will cover the first two points.
Korean Government, the Creative Economy, the Origin Story
If it were not for the Korean government, there would not be a Korean startup scene. Well, there would be one but it would not be as highly organized as it currently is.
The Korean government is in the midst of a multi-billion dollar, multi-year push towards innovation dubbed “The Creative Economy”
The major benefactor of this large capital allotment has been the startup industry. This move, a major policy of the Park administration to attempt to revive a stagnating economy, includes: massive investments in infrastructure that produced countless co-working spaces all over Seoul, targeted events to bring in foreign entrepreneurs (such as the K-Startup Grand Challenge), as well as much needed capital investment into the startups themselves in the form of grants and other monetary devices.
Positive externalities of these efforts are already manifesting themselves in the form of Google opening its first startup campus in Asia in Korea, WeWork expanding their base of operations to Korea, Altos Ventures focusing heavily on Korea, and 500 Startups developing their Kimchi Fund to target the Korean market. These are only a few of the many proof points that show what the Korean government is doing is working.
Bringing in these outside investors and innovators is crucial in this stage of the startup ecosystem’s evolution as far too many startups in their current form will not reach notable success because they are laser focused on the lowest hanging fruit — the Korean market. In order for Korea to truly take off and catch up with the rest of the startup world, it needs its startups to think globally. What better way to accomplish this than daily interactions with outside investors and entrepreneurs. On top of this, there are government sponsored trips to Silicon Valley so startup founders can better ascertain how to globalize their company.
All this being said, while the government helped start this movement, others must takeover. If the government has to maintain its high level of involvement, it is going to create an ecosystem that is heavily reliant on the government and cannot function individually.
Migration of Young Korean Workers
This point is my favorite to bring up and it is something that I did not notice until I moved here and started networking in the startup community.
In the past, if you were born in Korea and were able to study overseas, chances are you stayed overseas for work only returning to visit your family. It is not that there weren’t opportunities in Korea, it is just there was more job diversity and growth potential abroad.
Koreans, both native and Korean-American, are moving back to Korea en masse to either join startups or start their own
What is now happening is many Koreans who went to high school or college overseas are returning to Korea to start their own company or to join an existing startup. The same can be said for Korean-Americans who would have never dreamed of moving to Korea and are packing up and moving to get a taste of the startup scene.
It is one thing for a startup scene to be bolstered by the innovation of its locals. That’s what helped jumpstart every major startup ecosystem (Silicon Valley, London, Berlin) as well as every quickly growing region (Southeast Asia), but what none of these places have that Korea is currently witnessing is, not only, the return of its expat population but also the return of people whose families left ten, twenty, thirty years ago who are coming back to be part of something very big and very real.
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Enjoy this post? Absolutely hate it? Let me know by commenting below.
Next week, in Part II, I discuss the evolution of the Korean mindset and the concept of struggle and it’s relation to the Korean startup.