At a startup conference held in Daejeon, home of the Korea Advanced Institute of Science and Technology, last month, a member of the audience posed the following question to Moaffak Ahmed, an early stage investor and partner at Slush, one of the largest startup conferences in Europe.
“How can you protect your ideas when you haven’t patented them?”
The answer was that you can’t. And the more important part of the equation is how you can deploy your idea, and put it into practice. Anyone can have a good idea, and a lot of times, people have good ideas. But it’s rare to see the ideas really take off and become a part of life. This takes guts and also the determination to see things through, and that’s why startups are hard.
Recently, I heard that lawmakers and policymakers frequently ask accelerators and investors why there aren’t enough unicorn startups in Korea. Unicorns – an overused word, really – indicate unlisted startups with a corporate valuation of $1 billion or more, supposedly the ultimate culmination for startups.
Such unicorn status has been given to eight startups here in Korea. On average, it took the firms around seven years to reach that stage.
So why aren’t there more? The answer varies, but the latest answer I got from Paddy Cosgrave, the founder of RISE, the largest tech conference in Asia, was the most refreshing: Why is it not OK for Korea to have only a few unicorns?
Not to mean that it’s just fine, but to mean that we are getting there, and that we aren’t doing a bad job at all.
“Europe has less unicorns, but they have better outcomes,” he pointed out, highlighting how the European economy is still one of the richest in the world. There are also countries like Finland, where 90 percent of university students say they want to start and run their own companies. They aren’t flush with unicorn companies, yet they thrive and have young people eager to go out and make mistakes.
And for Korea, the situation is more than promising.
First of all, the government is willing to burn money. Over the next three years, Seoul is ready to spend more than 10 trillion won ($8.63 billion) on the startup industry. Being top-down and government driven, yes, this approach will have its limits. But now is not the time to think about that. Yes, regulations have got to go or become simplified, but it’s great news that the nation is trying its best.
It’s not something to be embarrassed about. That’s how many, many economies and new sectors were built. Look at the US, and how it built Silicon Valley. China, which has no notable memory chip technologies and has to import them to build hardware, then export it back out, is working hard toward developing self-made DRAM and NAND Flash. The firms that are developing these chips are getting extremely strong government backing, as should all sectors that form the backbone of a nation.
Second, while it’s not good to be fixated on unicorns or the lack thereof, everyone’s trying their best -- Korean style. When my team, The Investor, was launched in 2016, there were just three. Now there are eight. That’s eight out of 346, but the figure has more than doubled in three years.
When it becomes “OK” for startup founders to speak up about what’s going wrong with regulations, it becomes “OK” for them to stand up to investors. For investors, when it becomes “OK” for them not to think about industries the government would approve of, they don’t have to worry about appearing mercenary or inhuman for exiting floundering startups and making heaps of money from investments.
Some blame the government, saying it’s the policymakers who need to listen more. But it’s also up to all of the players. The startups founders, the startup employees, the investors, the regulators, the global economy, the local economy and even the consumers. And from the way things are going, it feels like next year will be the year that we see double digit growth in the number of those darned mythical animals.
Kim Ji-hyun is the managing editor of The Investor, a company of The Korea Herald. (firstname.lastname@example.org)