Government support and private investment in local startups have given rise to a stream of regional companies that develop new content and lift surrounding commercial districts. Now voices are growing that these firms should be nurtured as a growth engine for the Korean economy rather than treated merely as a tool to revive local commerce. The key is building the self-sustaining strength to reach global markets instead of settling for success at home.
Lee Byung-sun, CEO of the Jeju Center for Creative Economy and Innovation, met with Seoul Economic Daily at the center on the 19th and said local companies should move beyond the domestic market to global markets rather than remain within their own regions. "Only then can a company like Starbucks emerge in Korea as well," the CEO said.
"If government policy is buried in reviving local commerce and creating jobs alone, it easily ends up as support for the sake of support," Lee said. "The ultimate goal of entrepreneurship should be for a company to grow large, create new culture and lifestyles, and return those gains to the region." The point is to identify competitive companies in the region, grow them quickly, and build a virtuous cycle in which the results flow back into the local startup ecosystem.
Building a "growth ladder" is also what the Jeju center emphasizes most in nurturing local firms. The reasoning is that local companies are concentrated in food and beverage, tourism and content rather than technology, and therefore need a separate development framework suited to those sectors. "Local companies grow by making a good product and then solving one question at a time — how to build a brand, and where to sell," Lee said. "What matters is connecting the support needed at each stage without gaps."
The center operates a growth framework that runs from early-stage startup support to nurturing local creators and entrepreneurial small business owners, and on to Loan Investment Programs (LIPS), a matching loan program linked to private investment. This year, together with Jeju Province, it launched a new program called "The Jeju Creator" to develop companies with high growth potential into anchor firms for the region.
Lee drew a line at the idea that using regional specialty products or content is a requirement for local companies. It is enough, the CEO said, if the reason for founding a business in that region is clear and can be turned into a competitive brand. "Sungsimdang and Terarosa did not grow because they used local specialty products," Lee said. "Above all, the product itself has to be competitive, and it would be good to add branding on top of that which can explain why this company started in this region."
Lee also called for changes in government policy. "There is a need to shift the weight of policy from a subsidy-centered support system to one centered on investment," the CEO said. "Appropriate support programs matter, but investment should allow local companies to upgrade their business models and naturally lead them to scale up."
That is also why the Jeju center is putting effort into building its own venture investment ecosystem. Total committed capital in the funds the center manages stands at about 20 billion won ($14 million). Last year it created the 10.1 billion won Korea-Japan Jeju Startup Fund. The structure has Japanese limited partners and companies help Korean local firms enter the Japanese market. "This fund is meaningful in that it does not stop at bringing overseas capital into Korea, but also lets us tap the overseas business experience and local networks that the investors hold," Lee said.
The center plans to further strengthen support for local companies going global. The judgment is that the success or failure of local firms ultimately depends on whether they have the capability and vision to reach global markets. "Starbucks, too, was a local company that started in one region of the United States," Lee said. "In Jeju as well, local companies that can compete in world markets — not just anchor firms at the center of local commerce — can certainly emerge."
