15 Daegu companies selected as Ministry of SMEs and Startups and 11 companies selected as strong global SMEs
Daegu and Daegu Technopark (Daegu TP) announced that a total of 26 companies outside of the Seoul Capital Area have been selected for the Ministry of SMEs and Startups’ “Local Star Company Project” and “Strong Global SME Project” to foster promising small- and medium-sized enterprises (SMEs) and that 21 of them (81 percent) are companies that have been designated by Daegu as “Star Companies.”
The “Local Star Company Project” is a nationwide project launched by the Ministry of SMEs and Startups, which benchmarked Daegu’s project for fostering star companies, in 2018. The ministry aims to support 1,000 outstanding SMEs with high growth potential and capacity to grow with talented local youth, and select 200 of them to grow into strong global SMEs.
The “Strong Global SMEs Project” is the Ministry of SMEs and Startups’ project to foster promising SMEs into leading exporters with at least USD 10 million in export turnover. Since 2011, the ministry has been identifying 200 Korean companies to provide intensive support for overseas marketing and other areas and foster them into the World Class 300 companies.
※ Ministry of SMEs and Startups’ Growth Ladder Policy: Local Star Companies → Strong Global SMEs → World Class 300
This year, in particular, 22 companies located in Daegu applied for the Local Star Company Project; 17, for the Strong Global SME Project, despite economic difficulties due to COVID-19. After the evaluation process (paper evaluation, on-site evaluation, and presentation), a total of 15 companies were selected for the Local Star Company Project, and 11 were chosen to participate in the Strong Global SME Project.
The 15 companies selected as Local Star Companies have an average revenue of KRW 16.5 billion and employ an average of 44 people. The compound annual growth rate (CAGR) of the companies over three years is 12.7 percent; and the CAGR of the employment rate is 9.1 percent.
The 11 firms chosen for the Strong Global SME Project have an average revenue of KRW 31.6 billion; export turnover of KRW 13.1 billion; and 102 employees. The CAGR over three years is 6.8 percent; the CAGR of exports is 20.8 percent; and the CAGR of employment is 1.7 percent.
MicroNX, which has been selected as a Strong Global SME, was designated as a Pre-Star Company by Daegu in 2017. Through the city’s customized support, the company became a Local Star Company in 2019, recording 25.7 percent growth in exports and 18.8 percent growth in revenue compared to 2018. The proportion of the company’s exports was over 60 percent compared to sales as well. With such outstanding technology and export performance, MicroNX was chosen to be a 2020 Strong Global SME.
There are five Star Companies that have advanced to become Strong Global SMEs since the launch of the Local Star Company Project in 2018: SLC (cosmetics), Young Poong (K-food), Nakyung (window blinds), Shinpung Textile (high-performance fiber), and MicroNX (dental devices). Going forward, the number of companies that will scale-up is expected to increase.
The newly selected Strong Global SMEs in 2020 will receive a wide range of support from both the central government and the Daegu Metropolitan City, including growth strategy consulting, R&D planning and support, customized business and project support, and capacity strengthening training, which will help them grow into global enterprises.
Lee Seung-ho, Daegu’s Vice Mayor for Economic Affairs remarked, “We will provide systemic support for companies that have been selected as Local Star Companies and Strong Global SMEs, so that they can vitalize the local economy in these difficult economic circumstances and grow into strong companies that will spearhead innovation and growth.”
The certificate presentation ceremony for the companies that have been selected as Strong Global SMEs this year will be held at the Daegu-Gyeongbuk Regional SMEs and Startups Office on June 16; and the ceremony for the companies that have been selected as Daegu’s Local Star Companies will be held in early July.