Seoul Global Business Centers offer multitude of free services for foreign start-ups
Published Nov. 13, 2012, in The Korea Herald
The following is the first in a series of stories featuring support and networking systems for foreigner-owned businesses in Korea. ― Ed.
Lia Iovenitti, president of market entry assistance company Conselit, put it like this:
“The more you’re successful, the more money you earn, the more taxes you pay, the more Korean employees you employ. So the more successful we are, the better it goes for the Seoul Metropolitan Government and for the business situation. It’s a win-win situation for us to become successful.”
In a nutshell, it was this fundamental business principle that prompted Seoul City to put special focus on assisting foreign-owned start-ups through the opening of the Seoul Global Business Center, in Gangnam, southern Seoul, in 2010 ― the first foreigner-geared business service of its kind in Korea.
The center aims to help entrepreneurs tackle the most common challenges, such as networking, administrative issues and, most commonly, language barriers, as some paperwork requires legal or translation services expensive for start-up entrepreneurs. It offers free resources available in English, Chinese and Japanese, such as step-by-step start-up logistics assistance, personal business consulting, frequent seminars and special lectures, networking events, business Korean language classes and even immigration support for business owners. The center does not provide loans or legal advice, but can recommend such services elsewhere.
Conselit president Lia Iovenitti (left) and MixMx creative director Cuon Kee-jung work in the incubation center for start-up entrepreneurs at Yeouido Global Business Center in the International Finance Center, Yeouido, Seoul, in late October. (Lee Sang-sub/The Korea Herald)
Its stand-out service, however, is six months of free office space in an “incubation center” for a few qualified fledgling entrepreneurs.
In less than two years the SGBC became so popular that the city opened a second branch in Yeouido this January in the International Finance Center, where Iovenitti is currently an incubation resident. The SGBC in Gangnam was then renamed Gangnam Global Business Center.
“I’ve never experienced such a program or system for foreigners,” said MixMx creative director Cuon Kee-jung, representing his Japanese wife who owns their start-up digital design company based in Yeouido Global Business Center’s incubation space. “It’s a really good chance for Korean business to (reach) the global market.”
Each Global Business Center is equipped with a conference table, fully stocked office and a small, friendly, knowledgeable staff. The Gangnam center, conveniently located in COEX at the World Trade Center, features three cubicle-sized, glass-door offices for the entrepreneurs to hold meetings during office hours. By contrast, the Yeouido center’s office in the IFC hosts an open space with floor-to-ceiling windows, whiteboards doubling as moveable room partitions and desks for five incubation residents.
The Gangnam center’s rooms appeal to business owners preferring privacy or quiet time, while the Yeouido center’s open area is designed to provoke dialogue and camaraderie among the entrepreneurs, according to Nicole Kim, manager of Yeouido Global Business Center.
“They share information and exchange very good business opportunities (at YGBC). Sometimes they cooperate with each other,” Kim said. In the center’s debut incubation session in the first half of this year, she said, one entrepreneur was involved in food and restaurant management consulting, and asked another who was focusing on mobile application development to create a smartphone app for his company.
However, Cuon of MixMx suggests that the services seem to be geared toward English-speaking business owners, therefore possibly making non-Western entrepreneurs shy away.
“Japanese society groups already know about this kind of facility, but mainly the facility is for English(-speaking), Western people. So they feel a little bit uncomfortable about joining in this facility. Maybe it’s the same for Chinese or other Asian people,” Cuon said. “If there were more support systems for non-English(-speaking) people it would be better.”
Residents at the incubation centers say that on top of the free office space, one of the best offerings is one-on-one help provided by director Steve McKinney, an American Chamber of Commerce in Korea governor and founder and president of his own company McKinney Consulting, who stepped up to head the Seoul Global Center in May.
A seasoned business owner and resident of Korea since 1990, McKinney stops by at each office at least weekly to follow up with the incubation residents, check on their progress and provide personal consultation.
“He’s a businessman. He knows what is important for the foreign businesspeople and for foreign society. I really like his way of thinking and his way of support,” said Cuon.
“(McKinney) has been a great resource, sounding board and advocate for us. We are blessed in a sense to have someone who is experienced in start-ups in Korea and is rooting for us,” said Bryant Kong, executive director of Christian College Consultancy Asia and an incubation resident at the Gangnam center. The rest of the staff helped with translation, resource gathering and Korean business culture advice, he added.
Perhaps the biggest drawback of the Global Business Centers, according to the staff and incubatees, is due to the popularity of the program. With just eight spots available in total, the centers can afford to provide just six months of residency, non-renewable, for the start-up owners to get on their feet with enough capital to rent their own space. Additionally, the entrepreneurs face additional costs to reproduce business cards and documents with their new addresses.
“We still have two months and 10 days. We always think about that,” counted Yu Hang, Yeouido center incubatee and senior consultant of Quill Cloud International, a company distributing pharmaceuticals to and from China.
“If you register a new company, you have to wait at least one month till you get a license for your new company, and you connect with your customers and clients, make some relationships and connection with consumers ― two months, and then three months have already passed,” he added. “Maybe after launching in the market, another two months already pass. (Then) with one month left, you must prepare to pack up.”
Several incubation residents say they wish the period was at least nine months to a year, but overall expressed satisfaction, some even feeling “lucky” for the space and services granted at the center.
“I think they help us a lot. Because they don’t know your business they are not perfect for personal business … but just help us in some general direction,” Yu said, noting the unique challenges in doing business in China and working with pharmaceuticals. “We understand. Sometimes they want to help us more but they don’t know how to. They have their limitations; we know that but we appreciate it.”
Applications for the next round of incubation, which provides free office space, business support and coaching, are due on Nov. 14 for the December 2012 to May 2013 period at Gangnam and the January to June 2013 period at Yeouido.
Applicants must be foreign-born and applicable for long-term residency in Korea, as well as have the initial capital and feasible business plan to establish a business immediately. After a document screening, four business experts from outside the SGBC will evaluate candidates through a face-to-face interview.
Additionally, the Gangnam center will host a tax seminar sometime in November and an intellectual property seminar in December for Japanese entrepreneurs.
For applications and more information, visit global.seoul.go.kr/bizsupport.
By Elaine Ramirez (email@example.com)
Setting up a business in Korea as a foreigner
Process time: 1-4 months
- To obtain a Certificate of FDI Notification, have at least 100 million won ($91,800) in foreign direct investment capital, 10 percent ownership of the company’s stocks and an attorney-notarized certificate of nationality. (FDI exceptions include certain F-visa holders such as permanent residents, those married to Koreans and Koreans born overseas, who may all set up through generic Korean requirements.)
- Open a local personal bank account under the investor’s name.
- Deposit the FDI funds to the local bank account, either by wire or by hand declared through customs.
- Incorporate the company at the registry office.
- Register the business at the district tax office.
- Obtain a “Certificate of Foreign-Invested Company” from the bank and open a local bank account under the company’s name. Transfer the FDI from the private account to the company account.
- Apply for a D-8 visa at immigration. The length of visa issuance depends on the FDI amount and business performance.
(Source: Gangnam Global Business Center, Korea Exchange Bank)