In the U.S., Babson College founded the world's first start-up faculty in 1999 and provided start-up education. Since then, more than 400 schools, including MIT and Stanford, have used start-up subjects as formal subjects, and many countries, including China, Finland, and Japan, have positively supported university student start-ups. Let's take a look at what university students’ start-ups means and how Korea supports university student start-ups.
Start-ups by university students
According to OECD's announcement in 2017, among the 35 member countries. adult unemployment has increased in Korea for the third consecutive year. Furthermore the Korea Research Institute for Vocational Education and Training said that the employment rate of University graduates has decreased by about 10.6% over ten years as of 2017. This is expected to worsen. Also, according to the 2017 Korea Employment Information Service's study of Employment Impact of the 4th industrial revolution, the development of artificial intelligence and robotic technology can wipe out more than 18 million jobs within ten years. It means that unlike in the past, a permanent job no longer exists. Start-ups has emerged as an alternative way to solve the problem of increasing unemployment and to replace disappearing jobs in the future. This is because start-ups stimulate economic activity. As a result, companies that are born from start-ups and this can leads to a virtuous cycle of new employment. When the U.S. GDP reached 20,000 dollars, they tried to reach their goal to exceed 30,000 dollars in GDP. The U.S. has systematically invigorated entrepreneurship and start-up education from youth to college students, and universities have used the study of entrepreneurship and start-ups as formal academic subjects. According to the Ministry of Science, ICT on March 14, 2018, Stanford alumni founded 40,000 companies, creating a total of 5 million jobs, and MIT alumni created 1 million jobs only in Massachusetts through the establishment of a laboratory. Thus, the need for start-ups is increasing in Korea. TheKorea government spent 1.118 trillion won to support start-ups in 2019, an increase of 43.4% over the previous year.
The results of a survey of 418 universities, targeted by the Ministry of Small and Medium Venture Enterprises (SME) and Start-ups and the Ministry of Education conducted in 2018, showed that 1,684 students founded start-up companies in 2017, up 26.8% from the 1,328 in the previous year. Also, the number of start-up companies founded by students increased 26.2%. There are 1,503 start-ups. School that provide funds for student entrepreneurs and external support totaled 171 million won, up 38.6% from the 124 billion won in 2017. More schools are introducing a program for start-up students, which is called a start-up friendly bachelor's degree program. A typical example is a start-up school break program. The start-up break program allows students to take a break from school to start a business. It allows students to take extra break time in addition to the average of three-year it usually takes to start a business. The start-up friendly bachelor’s degree program has been implemented by 252 universities nationwide, and 674 students are using the system. For example, Choi Dong-won, a junior at Dongguk University who majored in industrial system engineering, started a business called ‘Men’s class using a start-up leave program. Men's class is a men's fashion consulting company that provides fashion consulting from professional stylists for a fee of 100,000 to 400,000 won per year. In a year and three months, he had enormous success with more than 1,000 people using his service and with advertisments from about 30 brands of major fashion companies.
Despite the increasing demand and interest in start-ups, there are many shortcomings in current start-up education.
First, there is some criticism that the government and universities emphasize only short-term outcomes when they look at start-ups. To explain it in more detail, the supporting start-up programs by the government focus on the early phase of the start-up. This means that students receive support for a limited time from the preparation of the start-up to the beginning the start-up. Businesses often have good long-term outcomes even if they fail in the short-term. But current start-up supports focus on areas that produce short-term results only. This can lead to lost ideas and business items that can be of immense value in the future. Shin Dong Pyung, a senior researcher at the Korea Institute of Science & Technology Evaluation and Planning, pointed out the problem by saying that "Most of the government's budget for start-ups is concentrated in the early stages." The hardest time of start-ups is between the third and the seventh year after the start. This called the Valley of Death, but support for this period is scarce.
Secondly, the type and method of start-up education provided at universities are not discriminatory and insufficient. If you take university lectures, they are not helpful because they are organized in similar subjects. In the first semester of 2020, Inha University held six lectures related to start-ups, including 'Tale of a Start-up which changing the World', 'Understanding the Start-Up,' and 'Actual Start-Up.' Looking at the lecture plan, the content of the subjects was not significantly different and had little relation to genuine business. Most of them were related to financing, such as 'How to make a business plan' and 'How to get government funding', and much of the content overlapped.
Finally, there is a cognizance problem with start-ups of students. Kim Ji ah (24), a young entrepreneur and a university student, said in an interview with Maeil Business Newspaper, "Since the second half of last year, the business has been difficult because of team members’ attrition from the start-up due to getting a job with a major company and job preparation." As the number of students who think lightly about start-up increases, human resources problems were caused by people withdrawing, and it became more difficult to attract external investment. Also, she said that "After the establishment of the corporation, he got a lot of questions by investors about if he intends to continue the business whether or not he can attract external investment." Many students use the start-up as a means of making qualifications. In an interview with No Cut News, Lee, a university student, reported the closure of a start-up to get a job. He developed a service to mediate the space of cultural leisure facilities in the second half of 2018, but he gave it up before it was commercialized. He said, "Recently start-up careers have been added to the evaluation of major companies’ documents screening, so I plan to utilize it." According to academy information, about a third of the start-ups registered by university students in 2018 reported zero won in sales. These start-ups were seen as a means to be used to augment qualification in job-seeking. It shows university students need to improve their perception of start-ups, who think of start-ups as just as qualifications for employment.
What is K Start-up?
K start-up is a typical supporting start-up program. Let's find out what K Start-up is and which projects are in progress now. K start-up is a government-initiated brand to support a start-up system, that is not investor-centered but founder-centered, and is operated by the Ministry of SME and Start-ups since 2016. It helps students solve and improve problems that occur in start-up support programs. Moreover, students who wish to start a business can request support from similar integrated projects. They support start-ups in various fields including start-up education, facilities, and space provision, mentoring, consulting, commercialization, financial support, and R&D (R&D).
First, there is a University Entrepreneurship Center. Start-ups are supported in nine universities including Inha University and Ewha Womans University through the University Entrepreneurship Center. Ewha Womans University has a variety of programs to support student start-ups, such as EVCC andNae: il Lounge. EVCC is a regular meeting program that fosters collaboration with professionals in the start-ups for students who taking entrepreneurship lectures or start-up circles. They meet with people from various companies like KT and Ahnlab, and it lets students learn good things from them. Additionally, Ewha Womans University opened the Nae: il Lounge in 2019 for job seekers and start-ups. Nae: il Lounge has a double meaning of tomorrow and my job in Korean, helps students make their careers through a variety of programs, including creative education and workshops, exhibitions, and experiences. Nae: il Lounge is divided into the three areas of work consulting, cafe, and box. Nae: il box has a job booth and an open table that can be used as a space for company briefings, mentoring, and a place for start-up circles. Kim Hye-sook, president of Ewha Womans University, said, "Ewha Womans University will not only create a history of challenges and opportunities but also present a vision of building a stable start-up ecosystem like Silicon Valley in the U.S."
The second program is “Challenging! K Start-up.” The Ministry of SME and Start-ups and Korea Institute of Start-up and Entrepreneurship Development have held "Challenging! K Start-up" every year since 2016. This competition is the largest entrepreneurial competition in Korea, in which seven ministries (Ministry of Science and ICT, Ministry of Education, Ministry of National Defense, etc.) participate. Anyone who has good start-up items can participate and receive support for a total of 1.58 billion won in prize money and various programs such as start-up, R&D, and patents. A typical success case of "Challenging! K start-up" is ECO-ST1 from Starstech. Yang Seung Chan, the CEO of the Starstech, noticed the ability of starfish to adsorb chloride ions. After entering Seoul National University, he studied and discovered its mechanism. Specifically, he found out starfishes can suppress the corrosion of iron structures such as vehicles and bridges by the use of potassium chloride. He applied in "Challenging! K Start-up" and he was able to create eco-friendly snow remover, ECO-ST1, when he served in the army. ECO-ST1 overcame the limitations of existing snow removers and became famous as a snow remover that minimizes corrosion on automobiles and bridges. It was also evaluated as eco-friendly because it is made by using starfish that is known as marine waste that causes oceanic pollution. As a result, Starstech won the best award at "Challenging! K-startup." After the competition, they attracted 2.25 billion won in investment by an investment firm and was designated as an excellent procurement product by the Public Procurement Service.
Supporting Start-up programs in domestic universities
First, Soongsil University, in 2017 and 2018, has been making efforts to support start-ups and has been selected as the best university as a leader in fostering start-up for the second consecutive year. Soongsil University created 41 companies with support for start-up items as of 2017 and achieved 341 jobs and 23 billion won in sales. A typical example is a Pixel Display that started from a start-up circle called PIXEL. Kwon Tae Hyun, the CEO of Pixel Display, said, "I had trouble with pursuing my start-up and university life at the same time, but thanks to the school support program, I was able to solve the difficulties." By using an office provided by the university, that was made for start-ups, he was able reduce travel time to attend school so his working time could be used efficiently. In addition, to overcome the difficulties of studying and working at the same time, he got credit for working hours by using the field training system. He got technical advice through "Soongsil Strongest Start-up" which supports students to commercialize their start-up items. Soongsil University is also conducting a variety of activities in its start-up education. In 1995, it established its first venture small and medium-sized enterprise department to give students access to the business and technical environments of small and medium-sized enterprises.. For students who want to start a business, the university runs practicum programs such as global market experience, item selling, start-up competitions, internship programs, and contest-preparatory programs. Also, they run courses like Developing a New business, Strategy for growing start-ups, Case studies of small and medium-sized companies, and Global start-ups that lead to a successful start-up.
Secondly, Inha University has been hosting Super Challenge Hackathon with nine schools, including Seoul National University, KAIST, and POSTECH. Hackathon is a software developing project event in which programmers, related graphic designers, and project managers work intensively to create software. Hackathon is an abbreviation of hacking and a marathon. Participants compete with others to develop program on a given theme in a limited time. By collaborating with others through Hackathon, developers, planners, and designers can find good items to start a business. Inha University provides support for participating students to use the necessary equipment along with 3D printers and laser cutting machines for rendering education. At the Hackathon which was held in 2019, the Ring ding dong team, which was composed mainly of Inha University students, won the grand prize for developing a system that automatically manages the sleeping environment. Bed Lock, which they proposed, is a home IoT kitthat automatically controls the electrical elements before sleeping, waking up, and sleeping environment. Bed Lock can also record sleeping patterns by connecting with smartphones.
After the Hackathon, Inha university student said in an interview with Inha Press, "Through participating in the Hackathon, I have an opportunity to look back on problems that I have not discovered yet and to learn from them while discussing various directions." The 2020 Super Challenge Hackathon also came up with various ideas, including an empty subway seat alarm service, an automatic umbrella dryer, and a safety aid for electric kickboard.
Supporting Start-up program at overseas universities
The first Start-up program is at UTEC in Japan. In 2004, the University of Tokyo established UTEC, a university venture capital, and invested exclusively in start-up ventures that utilize university research results (patents) and researchers (professors and students). UTEC supports start-up by utilizing technological competitiveness in science and engineering. By 2020, more than 300 start-ups were founded with investments from the University of Tokyo, and 10 of them like Peptidream and Euglena were quoted on the stock market and its stock reached about 20 trillion won. Euglena, invested 54 billion yen, using eco-friendly material to develop health foods, cosmetics, and biomass fuels, and has expanded its business into China and Singapore. The University of Tokyo's robotics company Shaft, which took first place in the DARPA Robotics Challenge, was acquired by Google in 2017.
The next program is 3DS in the U. S. In January 2008, the 3DS started with a few students from the University of Texas at Austin gathering and created 3DS. 3DS (an abbreviation of three days) aims to get students start a technology start-up after a three-day course over the weekend. They recruit students who have good business ideas, through interviews, and conduct workshops before 3DS begins. In the main program, students conduct interviews with customers, market research, mentoring, and other programs necessary for start-ups. Finally, five or six selected teams are evaluated and announce their business models. The advantage of 3DS is that successful entrepreneurs, corporate executives, and venture investors attend as panelists and immediately ask questions and give feedback about the items. The selected start-up team also can partner with the company that they worked with in 3DS as business partners. In 2016, 55 of these programs were operated by universities in North America, Europe, Asia, and South America, and 33 technology companies were successfully launched through 3DS, securing a total of $8.5 million in external investment. Y Combinator, a representative company created by 3DS, was famous for spreading the concept of an accelerator all over the world and invested $11.869 billion in 1173 companies like Airbnb by 2017. Accelerator refers to a company that discovers, supports, and fosters start-up companies. Korea also benchmarked 3DS and SW 3DS was held in 2019 by the Ministry of Science and ICT.
We held an interview at the Inha University Entrepreneurship Center.
The Inha Times (IT): Most students don't have the money to start up their own business, even if they have good ideas. If there is a funding program, please let me know.
Entrepreneurship Center: Typically, we run "I Startup Lab Accelerating" which provides about 1 million won in 10 teams to develop a prototype in three to four months. This program receives applications every semester-by-quarter basis, and they also support demo days.
(IT): There is any other support from the school, such as consulting for student CEOs?
Entrepreneurship Center: We hold regular mentoring days. Also, other support programs include mentoring. Since there is a separate start-up professor, if students want to, they can apply and receive mentoring anytime.
(IT): Are there any start-up cases that get assistance and support from the program of Inha University?
Entrepreneurship Center: A good example is Soft Squared run by Lee Ha Neul, who graduated from Inha University's computer engineering department. Soft Squared is a software production development company that executes a program from planning to design development. Various activities such as programs of outsourced collaborative education are also carried out. They also won the Excellence Award at 2019 IF Start-up Festival.
(IT): How can an interested person contact the Inha Entrepreneurship Center?
Entrepreneurship Center: We run official websites, blogs, and Instagram, so you can access the center directly.
Many countries and universities provide a lot of support for start-ups. Korea also has many support programs. The 4th Industrial Revolution will change our lives significantly. This is especially true in light of facts like the disappearance of permanent jobs increases. Getting a job is an effective way to live your life. But trying the start-up also can be an effective way to show your abilities.
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