Eunjin Kim (you can follow her on Twitter: @eunnkimm) has compiled an impressive map of the current start-up scene in Seoul. Not only is it a great example of how to use the FusionTables API available from Google, but it also allows us to get a wonderful sense of the geographical layout of Korea's innovation infrastructure.
Start-ups appear to be concentrated mostly in the heart of Gangnam, with another small cluster near Hongdae in Mapo-gu. This is somewhat interesting for several reasons. First, Gangnam has some of the most expensive real estate in all of Korea, as well as the highest cost of goods in the capital city. Much as how San Francisco is one of the most expensive markets in the United States, the high costs don't appear to be slowing the onslaught of start-ups coming into the neighborhood.
What is interesting though is what this tells us about the location Korean start-up CEOs choose for their companies. Gangnam is also the site of Samsung and NCSoft, some of the largest firms working in the software space in the entire country. Hongdae, the other innovation cluster, is a much younger environment that generally attracts college students with its extensive nightlife and eateries. The CEO's choices would seem to reflect a desire to be near talent rather than youth, and this may also indicate the kind of employees companies are looking to employ.
One should probably not take away too much from this split - both sites are accessible from the No. 2 line on the Seoul Metro and are about 25 minutes away from each other. Nonetheless, it is interesting to see similar dynamics work in Seoul as does Silicon Valley. Palo Alto/Mountain View and SF remain the hubs for new ventures in the Bay Area, despite much cheaper places like San Mateo. These days, there is a constant discussion of whether Palo Alto or San Francisco is a better place to start a company (PA for the work, or SF for the fun?)
Clicking through the different categories, one of the draws of Gangnam may be its enormous number of venture capitalists, the vast majority of which have located along the No. 2 subway line following Teheran-ro. It almost seems like this is the Sand Hill Road of Korea, given the heavy concentration of the industry along this one street (although to be fair, the road is lined with skyscrapers, so the actual per person concentration of VCs in the area is certainly lower than Sand Hill). Although we can't tell from the map, I would be interested in the time-series analysis here - did start-ups follow the money, or did the money follow the start-ups?
Given this concentration of financing, it is interesting to see that the co-working spaces are spread relatively uniformly throughout the city environment. I can't help but feel that this will be a problem for many of them, since it is the concentration of entrepreneurial talent in one location that is so important for a start-up ecosystem to develop. While the map may not have complete data, I imagine that the economics of co-working spaces have pushed them to find cheaper real estate outside of Gangnam. Ultimately, such a strategy is just not likely to succeed, even with good urban transportation, but I am willing to withhold judgment.
All of this is interesting to watch though. Thanks to Eunjin for compiling and making this available!
Posted on October 28, 2012