Korea’s Startup Ecosystem Comes of Age

By Alberto Onetti 

Over the past decade, South Korea has emerged as one of the world’s fastest-growing innovation ecosystems. Just 10 years ago, the country had around 200 scaleups — today, that number has grown tenfold to more than 2,100.

What’s behind South Korea’s scaleup boom?

This remarkable growth has been fueled in large part by strong government policies, which not only supported startup creation but also introduced clear KPIs around innovation. The most visible initiative is the Global Unicorn Project, launched in 2019 by the Ministry of SMEs and Startups, which introduced structured categories such as “baby unicorns” and “pre-unicorns” as part of a national innovation roadmap.

These efforts have helped position Korea as Asia’s leading startup ecosystem outside of China and India.

According to the Tech Scaleup South Korea 2025 Report — produced by my organization, Mind the Bridge in conjunction with Crunchbase and which you can download here — Korea is on track to overtake Japan in the number of scaleups (2,127 vs. 2,268).

When it comes to capital invested, it has already taken the lead — $76 billion vs. $46 billion — marking Korea as one of the few regional innovation powerhouses.

Catching up — and surpassing — peers

The contrast with other fast-growing ecosystems like Japan and Australia is particularly telling.

A decade ago, Australia had a slightly larger scaleup base than Korea (281 vs. 228), while Japan had twice as many (463). Today, Korea leads Australia by 35% (2,127 vs. 1,580) and is almost on par with Japan (2,127 vs. 2,268).

Not just Seoul …

In most countries, scaleups tend to agglomerate around a single innovation hub — typically the capital city — leaving regional ecosystems behind. Korea is only partially following this trend.

While Seoul still accounts for 73% of all Korean scaleups, this concentration level is comparable to more mature and distributed ecosystems globally. The Gyeonggi region already hosts 14% of scaleups, and other hubs such as Daejeon, Busan and Incheon are progressing steadily from standup to startup phase.

This indicates a narrowing regional innovation gap, supported by forward-looking policies that encourage localized growth and specialization.

A notable example is the R&D Special Zones program managed by the Korea Innovation Foundation. Originating with the Daedeok Research Complex in 1973, Innopolis has evolved into a national science and tech backbone, now comprising five regional zones — Daedeok, Gwangju, Daegu, Busan and Jeonbuk — and 14 InnoTowns.

A center for global specialized R&D

This rapid growth hasn’t gone unnoticed.

As of 2025, 38 Fortune Global 500 companies have established an innovation presence in Korea, primarily through specialized R&D centers.

Why Korea? It has the trifecta:

1. A vibrant startup ecosystem;
2. A growing VC landscape; and
3. Deep specialization in frontier technologies such as robotics, AI, industrial automation and advanced manufacturing.

No wonder industrial giants such as Fincantieri — a global leader in complex shipbuilding — have joined the ranks of global corporations placing innovation boots on the ground in Korea.

In short

Korea isn’t just catching up — it’s becoming a global reference point for how smart national innovation strategies can deliver real economic transformation and global influence.

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Alberto Onetti is chairman of Mind the Bridge and a professor at University of Insubria. He is a serial entrepreneur who has started three startups in his career, the last of which is Funambol, among the five Italian scaleups that have raised the largest amount of capital. He is recognized among the leading international experts in open innovation and has wide experience in setting up and managing open innovation projects — venture clients, venture builders, intrapreneurship, CVCs — with large multinational companies, as well as advising and training on this subject. Onetti has a column on Sifted (Financial Times) and several other tech blogs.

Illustration: Dom Guzman