Does Early Incubating Improve the Performance of Start-ups?: Evidence from TIPS in Korea
Recently, the government has been pursuing various policies to create new industries and jobs through the invigoration of start-ups. For the sustained growth of start-ups, it is necessary to look not only at the supply of risk capital but also at policies for venture capital firms that nurture and f...
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| Format: | Article |
| Language: | English |
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Korea Development Institute
2018-05-01
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| Series: | KDI Journal of Economic Policy |
| Subjects: | |
| Online Access: | https://doi.org/10.23895/kdijep.2018.40.2.75 |
| _version_ | 1818321873386078208 |
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| author | KOO, JA HYUN |
| author_facet | KOO, JA HYUN |
| author_sort | KOO, JA HYUN |
| collection | DOAJ |
| description | Recently, the government has been pursuing various policies to create new industries and jobs through the invigoration of start-ups. For the sustained growth of start-ups, it is necessary to look not only at the supply of risk capital but also at policies for venture capital firms that nurture and foster start-ups. The purpose of this study is to estimate the effects of the nurturing and fostering role of risk capital, such as mentorship on the performance of start-ups, and to do this we analyzed the effects, as a newly introduced form of venture capital, of mentoring by an accelerator and investor ties on the performance outcomes of start-ups. We find that mentoring and investor ties for start-up enterprises positively influence follow-up investment in start-ups. In addition, this study finds that with a younger CEO of a start-up, it is more likely that the performance of the start-up will improve. Meanwhile, when examining increases in employment as a measure of the business performance of start-ups, mentoring and investor ties are found to have a positive effect on the increase of employment at start-ups. These results suggest that there is a need to promote policies that strengthen the mentoring role of venture capital in Korea's equity finance policies and in the government's SME support policies. |
| first_indexed | 2024-12-13T10:47:49Z |
| format | Article |
| id | doaj.art-23849ba1831b4c9f8073df0966824ce2 |
| institution | Directory Open Access Journal |
| issn | 2586-2995 2586-4130 |
| language | English |
| last_indexed | 2024-12-13T10:47:49Z |
| publishDate | 2018-05-01 |
| publisher | Korea Development Institute |
| record_format | Article |
| series | KDI Journal of Economic Policy |
| spelling | doaj.art-23849ba1831b4c9f8073df0966824ce22022-12-21T23:50:01ZengKorea Development InstituteKDI Journal of Economic Policy2586-29952586-41302018-05-01402759610.23895/kdijep.2018.40.2.75Does Early Incubating Improve the Performance of Start-ups?: Evidence from TIPS in KoreaKOO, JA HYUN0Fellow, Korea Development Institute Recently, the government has been pursuing various policies to create new industries and jobs through the invigoration of start-ups. For the sustained growth of start-ups, it is necessary to look not only at the supply of risk capital but also at policies for venture capital firms that nurture and foster start-ups. The purpose of this study is to estimate the effects of the nurturing and fostering role of risk capital, such as mentorship on the performance of start-ups, and to do this we analyzed the effects, as a newly introduced form of venture capital, of mentoring by an accelerator and investor ties on the performance outcomes of start-ups. We find that mentoring and investor ties for start-up enterprises positively influence follow-up investment in start-ups. In addition, this study finds that with a younger CEO of a start-up, it is more likely that the performance of the start-up will improve. Meanwhile, when examining increases in employment as a measure of the business performance of start-ups, mentoring and investor ties are found to have a positive effect on the increase of employment at start-ups. These results suggest that there is a need to promote policies that strengthen the mentoring role of venture capital in Korea's equity finance policies and in the government's SME support policies.https://doi.org/10.23895/kdijep.2018.40.2.75AcceleratorVenture CapitalBusiness IncubatorStart-upTIPS (Tech Incubator Program for Start-ups) |
| spellingShingle | KOO, JA HYUN Does Early Incubating Improve the Performance of Start-ups?: Evidence from TIPS in Korea KDI Journal of Economic Policy Accelerator Venture Capital Business Incubator Start-up TIPS (Tech Incubator Program for Start-ups) |
| title | Does Early Incubating Improve the Performance of Start-ups?: Evidence from TIPS in Korea |
| title_full | Does Early Incubating Improve the Performance of Start-ups?: Evidence from TIPS in Korea |
| title_fullStr | Does Early Incubating Improve the Performance of Start-ups?: Evidence from TIPS in Korea |
| title_full_unstemmed | Does Early Incubating Improve the Performance of Start-ups?: Evidence from TIPS in Korea |
| title_short | Does Early Incubating Improve the Performance of Start-ups?: Evidence from TIPS in Korea |
| title_sort | does early incubating improve the performance of start ups evidence from tips in korea |
| topic | Accelerator Venture Capital Business Incubator Start-up TIPS (Tech Incubator Program for Start-ups) |
| url | https://doi.org/10.23895/kdijep.2018.40.2.75 |
| work_keys_str_mv | AT koojahyun doesearlyincubatingimprovetheperformanceofstartupsevidencefromtipsinkorea |