Those early-stage startup fundings took up 76% of total venture capital fundings raised in the country in the first half of this year, down from around 80% each in 2022 and 2023.“There are growing concerns that the venture ecosystem will shrink as initial investments, once called the ‘flower of venture investment’, are slowing down,” said a venture capitalist.“In the past, there were many cases of starting a business after seeing a senior or colleague grow it into a unicorn company, but now there is no clear role model.”DEARTH OF INVESTMENT TARGETSSome venture capitalists blame a dearth of startups for a drop in early-stage startup investments.“There are no college students willing to start a business, so we have to chase them down and encourage them to start a business,” said a venture capital company official.
Seed fundings in domestic startups contracted to 76.5 billion won ($55.2 million) in the first half of this year, down sharply from 129.8 billion won in the same period of last year, according to The VC, a venture capital industry tracker.That compared with 206.4 billion won funneled into domestic startups for seed money in the first half of 2022.
Early-stage startup fundings have plummeted in South Korea as venture capitalists shifted to late-stage venture firms with stable business models amid the drought in venture capital funding, leading would-be startup builders to seek jobs at Big Tech companies.
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