Years ago, while studying in the United States, I came across a Lemonade Day project run by a university entrepreneurship center for children and teenagers. Participants set up lemonade stands in busy areas and made and sold drinks, experiencing business activities such as production, marketing and accounting while learning entrepreneurship along with how to save and donate. It struck me as a valuable chance to experience running a business firsthand, learning goal-setting, budget management, marketing and customer service from a young age.
These days, "Startups for All" appears to be a topic of interest among young people on university campuses. It is an audition-style startup program in which the government invests up to 1 billion won or more so that anyone with an innovative idea can try launching a business. From March to May this year, when the program began, more than 63,000 people applied, mainly university students and office workers, with young people accounting for 70% — suggesting the program has at least succeeded in drawing attention. According to a Ministry of SMEs and Startups survey, the program also helped improve perceptions: young people's "intention to start a business" rose 13.5 percentage points after the launch, while "negative perceptions of starting a business" fell 28.8 percentage points.
There is no question that "Startups for All" has raised enthusiasm for entrepreneurship among young Koreans. That is welcome news at a time when the number of people in their 20s and 30s who are "resting" — neither working nor looking for work — has topped 700,000 for the first time as good jobs shrink. But can heightened enthusiasm or passion alone guarantee their success?
According to 2024 statistics on business formation and closure, the survival rate of startups falls sharply from 64% after one year to 36% after five years, and for businesses run by young founders the figure is far lower, at just 20% to 25%. The 2024 Global Entrepreneurship Monitor survey ranked South Korea's entrepreneurship ecosystem sixth and its startup capabilities 27th out of 46 countries, both relatively favorable. But in areas concerning entrepreneurs' own attitudes and activity, the country was effectively at the bottom: 40th in "perceived opportunities to start a business," 45th in "fear of failure" and 45th in "motivation to start a business that changes the world."
In short, the figures suggest that while startup capabilities and the business environment have improved, too many businesses are still launched without adequate preparation. It appears to reflect the fact that young people's understanding of what entrepreneurs do remains superficial, and that they had few chances to receive systematic education on startups and entrepreneurship during their school years.
To raise the success rate of youth startups, South Korea needs to offer far more hands-on business experience from an early age, as Britain does through Young Enterprise and Singapore through its YES Schools. Government policy must also move beyond simply supporting business openings to focus on cultivating entrepreneurs, which determines whether a business succeeds. The key to invigorating the startup ecosystem is an entrepreneurial and venture spirit — the impulse to take on a challenge because there is at least some chance of success, rather than to start a business simply because government support has expanded.
Another problem to solve is the mass production of so-called cherry pickers interested only in government support, as happened with past government-led startup audition programs. There must be a structure that accumulates young aspiring entrepreneurs' track records as experience assets so they do not give up after failure, and that shares risk and pursues joint growth through bold co-investment by the government and the private sector.
The very act of the state lowering barriers to youth entrepreneurship and offering attractive opportunities is itself a new policy challenge. Now that the government has drawn out bold attempts by young people, closely examining the various conditions that will allow them to bear fruit is also a duty of a government seeking to open an era of national entrepreneurship.
