KITA Open Innovation Program – Cases of Excellence

Background of the KITA Open Innovation Program

Many major companies around the world have chosen open innovation cooperative agreements with startups as essential corporate strategies for purposes such as:

  • Acquiring promising technologies
  • Establishing new business models
  • Acquiring staff talents
  • Collecting market information

This trend also continues in small and medium enterprises, which have sought to improve the competitiveness of its value chain in the face of limited growth. Therefore they have focused on establishing open innovation teams, investment teams, and tech scouter positions.

This renewed interest in open innovation comes from the fact that the Fourth Industrial Revolution functions essentially as a GPT, or a seedbed that produces derived technologies in turn. Furthermore, the current stage of the technology life cycle is at its maturity. In addition, this phenomenon can be seen in AI technology, which was once considered as an expensive toy but now has assumed the function of a personal secretary in daily life.

In 2016, 52.4% of Forbes 500 companies have cooperated with startups. Some forms of cooperation include:

  • Technological advising
  • Business support
  • Co-working spaces
  • Accelerators/Incubators
  • Open Contests

The top 100 companies on the Forbes 500 have twice as much cooperation with startups (68%) as the lower 100 on the Forbes 500 (32%). In addition, 97 companies selected by the European Union (EU) as startup-friendly companies have separate and independent teams tasked with open innovation.

“The best way for companies to survive is through Open Innovation. Companies need to transform into something new. It is this idea of continuous transformation that makes you an innovation company,” said the Director at Global Startup Acceleration of KITA, Phil Jae Park.

Introducing the KITA Open Innovation Program

The KITA Global Scale-Up Program aims to develop unique and distinguished examples of successful open innovation through three projects: Fortune 500 Connect, Startup Test Bed, and NextRise.

Fortune 500 Connect

Open Innovation Fortune 500This project matches startups with open innovation teams or corporate venture capital (CVCs) of multinational companies. Therefore, open innovation with multinational companies represents ideal methods for acquiring investment or developing international outreach for startups.

A total of 206 startups were matched with 21 companies, including BASF, Lego, Chanel, and BMW in the previous year. This produced 16 successful cases of investment, technology sales, supply contacts, an accelerator program and more.

Investment

Beiersdorf AG, a German company famous for its Nivea product line, invested in 25% of shares for the beauty platform startup LYCL.

Technology Sales

BASF and Korean AI beauty device company WayWearable signed a contract for the introduction of technology. Therefore this allowed for the transfer of the technology of the Korean startup to the German company.

Supply Contact

An anonymous Korean cosmetics startup signed an NDA with Chanel for the supply of packages to the company. In addition, another anonymous Korean cosmetics startup signed a supply contract NDA with Daimler AG of Germany.

Accelerator Program

PANDA, a natural cosmetics startup was selected into Beiersdorf AG’s accelerator program for mentoring and cooperative programs.

Fortune 500Furthermore, established Korean companies that are interested in cooperating with startups have been matched with startups. This was done through the KITA business matching program. For example, Dongwon Industries are cooperating with Korean autonomous driving robot startup Twinny. They will focus on robot usage in logistics areas. In addition, Dongwon Home Food will cooperate with open-kitchen startup Open the Table. Sample tests have been completed and purchase plans have been announced.

KITA’s plan for 2020

KITA is the largest supporter of open innovation in Korea and an organization with experience in multiple projects in 2019. Therefore, they have brought an increase in international companies that have sought out potential cooperation programs. Their focus for 2020 will be on matching large to medium-sized established enterprises both local and international with Korean startups. So far in the first half of 2020, KITA has done business matching discussions with 9 large companies. Some of these companies include: L’Oreal, Bayer, and 30 medium-sized EU companies.

COEX Startup Test Bed

COEX Test BedKITA is the first private project that supports startups by establishing their proof of concept (PoC). Furthermore, they offer startups their first gateway to successful sales. They do this by offering the multipurpose facility of COEX as a testing site for the Fourth Industrial Revolution technologies. COEX Startup Test Bed offers internal R&D technology validation, references/delivery, demonstration, and feedback. The application period was in July of 2019 and 198 companies applied. Only 10 companies were selected for the COEX Startup Test Bed project.

KITA launched the COEX testbed project in 2019. They helped 4 main business operators in COEX discover new solutions that could innovate their existing services while providing startups with the opportunity to conduct proof-of-concept in the real world.

Internal Technology Validation

SoCar, a car-sharing company, tested its vehicle location search technology using 44 cars on the COEX outdoor parking lot.

Delivery and Reference

Interbrid, a company that specializes in new advertisement technologies, plans to demonstrate its technologies for three months prior to the delivery in indoor spaces within COEX. In addition, AI startup DOGONG plans to deliver its robots that replace night-time security personnel after a three-month testing period.

Demonstration and Feedback

Twinny, a startup that specializes in indoor autonomous driving robots plans to test and acquire feedback on its products on sloped areas within COEX.

KITA  and Socar Launch the First Private Testbed Project

KITA signed an MOU with Korea’s largest car-sharing platform Socar. Socar will join the COEX testbed project which is aimed at supporting startups with testing out their technology and solutions in real-life environments. Dong Ki Lee, the executive managing director at KITA and Jong Phil Won, the Chief Technology Officer at Socar agreed to their mutual commitment to cooperating on the startup testbed project.

KITA Socar MOUSocar’s Vehicle Identification System

Socar has developed a new vehicle ID system to resolve the problems that many users had experienced when trying to find their rented cars in crowded parking lots. Since Socar is a startup, they found it difficult to secure a proper place to test out the viability of their new technology in a real-world environment. Therefore the signing of the MOU with KITA is perfect for Socar as it will allow them to conduct the much needed PoC verification in one of the most popular COEX parking spaces. Socar will demonstrate its vehicle identification system in the rooftop parking lot of COEX for 3 months. The parking space has more than 600 individual lots.

Socar’s new vehicle identification system will make it easier and error-free for customers to identify and return their rented cars. Furthermore, it is expected to considerably improve the efficiency of business operations.

2020 Plan for the COEX Test Bed Project

The COEX Test Bed project will build upon the achievements of the previous year. They plan to do this by acquiring overseas testbed sites and working with private shopping malls for testbed sites. Therefore they will actively acquire institutions and landmarks overseas to support the PoC of Korean startups that seek to enter the market in that country. In addition, they are currently developing potential testbed sites in Spain, Luxembourg, Indonesia, and Dubai. Furthermore, they will seek cooperation with private shopping malls and major Korean retailers that are looking for digital transformations through retail 4.0.

NextRise: Korea’s Largest Innovation and Growth Fair

NextRise 2020NextRise is Korea’s largest startup fair. A joint investment between KITA and Korea Development Bank launched NextRise Seoul. They brought in angel investors, accelerators, VCs, multinationals, and many more from the tech startup ecosystem. Therefore, NextRise has quickly become a major international event with 21 major companies of Korea and 100 international experts/investors in attendance. The startup fair brought in 8,000 visitors in total. Furthermore, the event brought in 100 experts from 45 organizations and companies from 15 countries, 493 startups, and produced 332 1 to 1 meeting sessions.

NextRise 2020 Seoul

NextRise 2020 will be the 2nd edition of NextRise Seoul. It will take place in June of 2020. The startup event will bring in innovators, creators, and the startup community builders altogether from across the globe to create real business opportunities. Therefore, It is the most extensive and inclusive startup conference in Korea. They will bring in over 100 overseas investors and C-level representatives from large enterprises and 21 multinational corporations in Korea. In addition, there will be 1 to 1 business meeting opportunities with large global enterprises. In addition to speech opportunities in the country sessions.

Overseas VCs and large enterprises will get an opportunity to source innovative technology startups. Furthermore, they will have opportunities for business meetings and networking with all major startup ecosystem builders in Korea. These include over 150 Korean startups, top 10 Korean conglomerates, Korean startup unicorns, Korean VC firms, and Korean media. The event will have Open Innovation sessions, Keynote speeches, lectures, and seminars throughout the day.

NextRise 2020The event will take place at COEX from June 23rd to the 24th at the ASEM Ballroom and Hall D/Auditorium.


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John

John is the Editor-in-Chief at Seoulz. He has covered the startup, tech & blockchain scene for media platforms Startup Radar and Seoul Space having written over 600 articles on Korea's blockchain and startup ecosystem. John has worked closely with The Ministry of SMEs and Startups as well as the Korea Foundation for the Advancement of Science and Creativity. Email him at john@seoulz.com

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