Korea’s start-up dilemmaA recent comparative survey by the Korea Foundation for the Advancement of Science and Creativity on how different countries view business start-ups raises a gloomy outlook for Korea’s future. The Chinese were eager and positive about start-ups while 73 percent of Koreans said they believed starting their own business was risky. The number of people who said they would try to dissuade a family member from starting his or her own business was three times more than in China. The Japanese perspective on start-ups was smack in the middle between Korea and China.
The findings are not all that surprising. Young job seekers in Korea have preferred secure jobs in government offices since the Asian financial crisis. Others work toward getting professional licenses. Start-ups are generally dreaded. Korea has, overall, become relatively pessimistic about the odds of succeeding in a start-up.
One cannot blame the young generation for avoiding risk taking. Society has failed to encourage them and build their aspirations. Models of start-up success like STX and Woongjin Group have crumbled. Start-ups are mostly associated with the Internet and game industry.
In contrast, China has many entrepreneurs in their 20s through 40s who have succeeded in various fields. Even with its aging population, Japan is slowly shaking off its so-called Galapagos Syndrome that has put its industries in dead ends. Despite an overall economic slump, new business models like Uniqlo, SoftBank and Rakuten have sprouted, bringing new life into the corporate habitat.
Korea can no longer rely on large exporters and manufacturers. Even as they make money, they invest overseas, offering fewer new jobs to their fellow countrymen. Economic growth and jobs must come from start-up enterprises. President Park Geun-hye has encouraging a “creative economy.”
Few countries have ascended to the ranks of advanced economies without starting new enterprises - without taking some chances. Korea must recover from its past economic crises and generate bold entrepreneurs like the founders of Samsung and Hyundai Group. Risk-taking success stories can breed a positive cycle in start-up businesses. The entire society must applaud risk-taking and become more tolerant toward failures. A society that discourages start-ups has no future.