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Today, we will introduce Pre-TIPS, a highly beneficial funding program for early-stage startups.

Pre-TIPS is designed to discover and support early-stage startups located outside the Seoul metropolitan area.

This program provides up to 100 million KRW in commercialization funding to early-stage startups (within 3 years of establishment) that have secured at least 10 million KRW in private investment.

Pre-TIPS aims to select over 60% of its cohort from regional startups outside Seoul, fostering local startup ecosystems and uncovering exceptional technology talent.

To facilitate a smooth transition from Pre-TIPS to the main TIPS program, participating companies receive bonus points when applying for TIPS. Additionally, the investment secured during Pre-TIPS can be counted toward the minimum investment requirement from operators required for TIPS. Let's delve deeper into Pre-TIPS.

Funding Details and Scale

• Commercialization funding of up to 100 million KRW (government grant)

• Budget of approximately 4.3 billion KRW (supporting around 43 new companies based on 2023 figures)

Eligibility

• Startups within 3 years of establishment that have secured at least 10 million KRW in private investment (60% of the total selection is allocated to companies outside the Seoul metropolitan area)

• Early-stage startups as defined by the Support for Small and Medium Enterprise Startups Act, within 3 years of their official business commencement date as of the public announcement, satisfying all of the following requirements:

  • At least 2 full-time employees including the representative *Based on the four major social insurance workplace registration list as of the announcement date (must be maintained until agreement execution)

  • At least 10 million KRW in total investment secured from eligible investors within 1 year of the announcement date

Ineligibility

• Individuals or companies currently restricted due to national or local tax delinquencies

• Individuals or companies currently restricted due to debt default by financial institutions

• Cases where the startup's qualifications do not meet the application criteria, or the project proposal does not align with the business objective or announcement details

• Individuals or companies currently suspended from business operations as of the application date

• Individuals or companies engaged in industries excluded from startup support under Article 4 of the Enforcement Decree of the Support for Small and Medium Enterprise Startups Act

• Individuals or companies selected for and currently executing the Ministry of Startups and SMEs (MSS) 'TIPS R&D' or 'Startup Commercialization Support Program'* - Investors whose registration has been revoked by the MSS as of the application date - Other entities deemed ineligible for participation by the Minister of Startups and SMEs

Eligible Investor Types

The private investment must come from qualified sources. Please note that investments from entities not listed below do not qualify for Pre-TIPS.

① Startup Accelerators (Registered with the Ministry of Startups and SMEs)
② Early-stage Venture Capital Firms (including LLCs)
③ Corporate Venture Capital (including SMEs, venture firms, mid-sized enterprises, and conglomerates)
④ Global Investment & Incubation Organizations
⑤ Others (Technology Holdings, specialized technology startup companies, etc.)
⑥ Angel Investment Associations

Required Documents

• Business plan, proof of capital payment, shareholder registry, investment verification letter, integrity pledge, certified copy of corporate registration, business registration certificate, four major social insurance workplace registration list, documents for bonus points, etc.

Application Timeline (Based on 2023)

• 1st Round: February - March

• 2nd Round: June

• 3rd Round: September

Selection Process and Evaluation Method

• ① Application Submission (Investor/Startup) → ② Eligibility Review (Managing/Operating Agencies) → ③ Document Evaluation (Operating Agency) → ④ Presentation Evaluation (Operating Agency) → ⑤ On-site Due Diligence (Operating Agency) → ⑥ Final Selection (Managing Agency)

• (Managing Agency) Korea Institute of Startup and Entrepreneurship Development (KISED); (Operating Agencies) Korea Angel Investment Association, Korea Institute of Science and Technology (KIST), Korean Venture Capital Association (KVCA)

Today, we explored Pre-TIPS. Much like Seed TIPS, Pre-TIPS is an excellent preparatory program prior to applying for the full TIPS program. This initiative provides critical support for personnel and material costs, helping startups establish a solid foundation to scale. As the 2024 announcement approaches, preparing your application early will significantly enhance your chances of selection.

We will return with more informative content in our next post.
Thank you.