Korean start-ups seek funding not 5G - Mobile World Live

Korean start-ups seek funding not 5G

30 MAY 2019

APAC 5G LEADERS’ CxO SUMMIT, SEOUL: South Korea can’t support venture capital funds focused solely on technology because the country’s conglomerates, including all the mobile operators, are reluctant to invest in start-ups, argued Simon Baek, who handles fund management in Southeast Asia at InterVest.

Baek (pictured) pointed out that the top two tech starts-ups in the country have only about $30 million in total funding – Chinese start-ups are 100-times better funded than in Korea. Only one Korean AI start-up is in the top 100 globally.

“The conglomerates, like Samsung, SK, LG and Hyundai which all have acceleration programmes, say they care about start-ups, but they don’t really believe in start-up technologies. They think ‘why do we have to collaborate with them?’,” he said.

He said talent from renowned companies want to set up start-ups outside of Korea because it’s easier to get funding, noting Axiata, Ooredoo and Etisalat invest in more start-ups than SK Telecom and KT, the country’s two largest mobile players.

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He insisted efforts in Korea to support newcomers are insufficient: “They are trying hard, but they have to try harder,” adding many companies have the notion that talent in start-ups is not as good as in big companies.

5G can accelerate things like AI development, but “developing a 5G platform is not enough,” he said. In addition to incubation and acceleration of promising companies, they also need hands-on financial support.

Baek said the government also needs to ease regulations and complained the regulatory sandbox in the country is not flexible enough.

InterVest, with $1.2 billion in assets under management, is the fifth largest VC company in Korea. The Korean VC sector is growing rapidly, with about $3 billion invested in 1,400 companies last year, with most of the funds going into non-tech ventures.

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Joseph Waring

Joseph Waring joins Mobile World Live as the Asia editor for its new Asia channel. Before joining the GSMA, Joseph was group editor for Telecom Asia for more than ten years. In addition to writing features, news and blogs, he...

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