Hyundai Heavy Industries scion fosters a ‘PayPal Mafia’
Left, start-up entrepreneurs share a work space at a cafe on the first floor of the start-up incubator center Maru 108 in Yeoksam-dong, Gangnam, southern Seoul. Right, Chung Nami, managing director of Asan Nanum Foundation. [ASAN NANUM FOUNDATION, KIM SANG-SEON]
During an interview at Maru 180, a start-up incubation center, in Gangnam, southern Seoul, on April 22, Chung said she believes the most important factor for a successful start-up environment is the free exchange of opinions and ideas.
The 36-year-old is not only the eldest daughter of Chung Mong-joon - honorary chairman of the foundation, the largest shareholder of Hyundai Heavy Industries and a former politician - but also the granddaughter of the late Chung Ju-yung, who founded Hyundai Civil Works in 1947.
Chung used to work for Bain & Company, the management consulting firm. She joined the foundation, which was formed in 2011, in 2013.
Maru 180 is Chung’s brainchild, and she personally searched out and chose the location. The incubator was opened in April 2014.
Today, Maru 180 has 182 start-up companies, many with the dream of becoming Korea’s next unicorn, generally defined as a newly formed firm valued at over $1 billion.
One-third of Maru 180’s companies were discovered in the foundation’s start-up competition.
Some of the start-ups have achieved a degree of success, such Drama & Company, which created Remember, a business card app. The company was purchased in December by Line Plus, a Naver company.
Other start-ups include MyRealTrip, known for its travel platform, and Welt, which is a belt that collects and records health data of the wearer.
During an hour-long interview, she was asked what it was like to grow up as a member of such a well-known family. She said that she didn’t like the constant public attention.
But “today I believe I am in a position where I should take more social responsibility as a person who has received privileges,” Chung said.
Following are excerpts of the interview with Chung.
It is her first interview with a media outlet.
Q. Why did you take an interest in incubating start-ups instead of joining Hyundai Heavy Industries?
A. When I first joined Asan Nanum Foundation, many asked me that same question. But honestly, I have no grand plan. The reason I came to the foundation is because I was attracted to building an ecosystem for start-ups. My grandfather was the best start-up entrepreneur in Korea.
I wanted to work on creating an environment where such entrepreneurs could be fostered. I wanted to find work where I could give hope to people that were struggling amid pessimism.
What kind of place is Maru 180?
It is a start-up ecosystem where new companies, venture capital firms and accelerators work and grow in a single space.
The environment has changed quite a bit. In 2013, start-up support centers were little more than free office space. It was a structure where companies were working in spaces like chicken cages, and no one knew what the others were doing.
The companies were only focused on their businesses.
I believed such an environment will only lower the efficiency of start-up companies.
Maru 180 is a space where everyone doing something related to start-ups will be able to interact with each other and also with accelerators, such as SparkLabs and FuturePlay, and venture capital firms, like Capstone Partners.
Why is interaction in the start-up ecosystem important?
Innovative businesses and good services can only be created when people exchange ideas and share their opinions. One of the driving forces behind innovative companies in Silicon Valley was the so-called “PayPal Mafia” culture.
Former employees of PayPal - an early success - continued to interact and help one another when starting their own businesses, and this helped create companies like LinkedIn and YouTube.
There are no ideas that are completely new. One can only succeed when sharing ideas and giving advice.
I hope that start-ups that have passed through Maru 180 will spread this kind of culture across the industry.
Maru 180 is the first step toward a virtuous cycle where start-ups will be able to contribute to society instead of stopping with their personal success, going on and helping to lead other start-ups.
Start-ups are getting more support these days, but not many companies have succeeded.
First and foremost, the biggest problem is regulation. Our foundation conducted a study where we applied the business models of the top 100 unicorn companies in the world based on accumulated investments in the Korean market.
What we found was that 40.9 percent would be branded as illegal. Furthermore, only 30.4 percent would be partially approved under certain conditions.
This translates to 70 percent of these businesses unable to launch in Korea. The environment itself is unhelpful in driving innovation.
What kind of regulations do start-ups complain about the most?
Our society tends to choose the easy path when a problem emerges.
For example, workers must be hired to delete negative comments on online bulletin boards when the comments become a major social issue.
Under this regulation, start-ups that can’t afford to hire such a workforce won’t be able to start a bulletin board business.
Another example is the government requiring all smartphone cameras to have a shutter sound to prevent illegal photos.
Yet illegal filming has not been reduced.
As the government has been lifting regulations whenever they become a social issue instead of trying to solve the fundamental problem, start-ups are struggling to seize the right opportunity.
Do you have plans to start your own start-up?
At an early age, I learned and saw how difficult it is to start a company and to manage it.
Although Hyundai Heavy Industries is a big company, its future is not guaranteed.
I am aware how hard starting a company is and how determined I have to be.
I think I will be able to do it when I am ready.
BY PARK MIN-JE [kim.heyu@joongang.co.kr]
with the Korea JoongAng Daily
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