Pangyo Techno Valley overflows with start-ups
Just one year after its launch, Mangoslab raked in 8 billion won ($7.08 million) in revenue last year. When the team outgrew its office space at Pangyo Techno Valley’s Startup Campus in Seongnam, Gyeonggi, Mangoslab relocated to the Enterprise Support Hub at Pangyo 2 Techno Valley last November.
Enterprise Support Hub, which is only a three-minute drive away from Mangoslab’s previous office, houses 160 start-ups from diverse industries, including drones and information security.
Like the Startup Campus, the Hub is a project from the Gyeonggi provincial government and the Ministry of Science and ICT to nurture start-ups that show high potential and use advanced technology. It is also the first building completed at Pangyo 2 Techno Valley, which is due for completion next year.
Korea is putting forward Pangyo as an answer to California’s Silicon Valley and Beijing’s Zhongguancun, which is home to Chinese tech giants like Lenovo and Xiaomi.
Attracted by government resources and a vibrant start-up community, hundreds of Korean and foreign start-ups are packing their bags and moving to Pangyo.
“It’s convenient working in Pangyo because I have friends in the IT industry working nearby at Kakao and Nexon, and I can exchange information with other start-ups in the area,” said Jeong Yong-soo, the 36-year-old founder and CEO of Mangoslab. “Pangyo also hosts a lot of educational seminars on law and taxes.”
Pangyo 2 Techno Valley, at 430,000 square meters, is expected to host 750 more companies and focus more on nurturing start-ups. A large company that wants to move into the second Techno Valley will only be allowed to do so if it agrees to offer support services for start-ups.
Start-ups are battling fiercely to claim a spot at one of Pangyo’s many incubators and support centers. Though construction of the second valley is still ongoing, all the available office spaces have been filled.
“Once the 580,000 square-meter Pangyo 3 Techno Valley is completed, around 100,000 individuals will be coming to work in Pangyo every day,” said Lee Jun-bae at the Ministry of Science and ICT. “Pangyo will become the cradle of future-oriented businesses and cutting-edge technology.”
Success stories are not uncommon. Many Pangyo start-ups have already received millions of dollars from international investors in the United States, China and Japan.
Bagel Labs, which is based at the Startup Campus, raised $1.3 million through the international crowdfunding site Kickstarter. Its key product is Bagel, which it calls the “world’s smartest tape measure.”
Innomdle Lab, whose office is located at the second Techno Valley’s Enterprise Support Hub, raised around $2.2 million through crowdfunding site Indiegogo for Sgnl, a smart watch strap that enables users to answer phone calls by simply placing their fingers to their ear. An earlier prototype was selected as one of the top 10 wearables at the international 2016 Consumer Electronics Show.
Like Mangoslab’s Jeong, the founder of Innomdle Lab is an alumnus of Samsung Electronics’ C-Lab, an in-house start-up accelerator program that helps employees launch their own businesses. Around 10 C-Lab graduates currently run start-ups in Pangyo.
Pangyo provides an attractive opportunity for start-ups to learn from older tech firms that have faced the same challenges and overcome them.
Infobank, a 23-year-old tech company based in Pangyo Techno Valley’s U-Space, launched the TIPS (Tech Incubator Program for Startup) Program in cooperation with the Ministry of SMEs and Startups to connect promising start-ups with mentors well-versed in expanding a business.
Game companies like Neowiz and Smilegate - both headquartered in Pangyo - have their own venture capital division to invest and nurture young gaming start-ups.
Many non-Koreans also choose Pangyo to grow their business.
More than 70 foreign start-ups from 25 countries have made Pangyo Techno Valley’s Startup Campus their new home. Here they have the opportunity to interact with domestic start-ups and attend local “Demo Days,” where start-ups can flaunt their innovative products in hopes of catching the eyes of venture capitalists.
“We’ll soon be having ‘unicorn’ start-ups that are worth 1 trillion won or more in Pangyo,” said Kim Jong-kap, the CEO of K-ICT Born2Global Center, a start-up support center under the Ministry of Science and ICT.
According to the Gyeonggido Business & Science Accelerator, a government-funded institute that supports small enterprises, the total annual revenue from businesses located in Pangyo Techno Valley recorded 77.5 trillion won in 2016. The value is nearly equivalent to the gross regional domestic product of Busan - Korea’s second-largest city - which was 78 trillion won in 2015.
BY CHOI JOON-HO AND HEO JEONG-WON [email@example.com]