100-billion-won 'business ventures' grow in number and in sales

Deputy Minister Lim Jung-wook of SMEs and Startups speaks during a press briefing held at the Government Complex Seoul in Jongno District, central Seoul, on Monday. [YONHAP]

The number of “business ventures,” as defined by the SMEs and Startups Ministry, with over 100 billion won ($74.2 million) in annual sales increased by 16.7 percent to 739 last year, the ministry said Monday.

The increase was the steepest in a decade.

One-hundred and eight new companies entered the 100-billion-won club for the first time, a record figure.

The list includes start-ups as well as more established companies — such as Naver and Kakao — that have been certified as business ventures at least once since 1998 by the Organization for Venture Enterprise Certification. In order to be certified as a business venture, a company needs to meet the standards provided by the Act on Special Measures for the Promotion of Venture Businesses.

The ministry cited pandemic-driven growth in the bio and IT sectors for the companies’ strong performance last year.

“Companies that dealt with pandemic-related products and services such as diagnostic reagents saw a considerable jump in revenue and exports,” said Deputy Minister of SMEs and Startups Lim Jung-wook during a press briefing held at the Government Complex Seoul in Jongno District, central Seoul, on Monday.

“Moreover, as the pandemic sped up the digital transformation, companies such as Market Kurly and Baedal Minjok also experienced significant growth.”

The combined sales figure of the business ventures with sales of 100 billion won or higher rose 22.5 percent on year to 188 trillion won. It was higher than that of mid-sized or large companies, according to the ministry.

The operating profit rate stood at 11.8 percent from the previous year’s 8.7 percent.

The number of companies that reported a sales increase of over 20 percent for three consecutive years was also a record for the decade, coming in at 48.

Yet the upbeat performance isn’t likely to continue in this year or next year’s annual report, as the global venture and start-up market is rapidly shrinking amid recession woes.

“As Korea’s economy is suffering from steep base-rate hikes, weak currency and high inflation, the venture businesses’ dynamics and resilience will serve a significant role in overcoming the crisis,” said Minister Lee Young of SMEs and Startups during a celebratory ceremony held at Swiss Grand Hotel in western Seoul, Monday.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]