China becomes startup hotbed, second only to the U.S. in unicorn population

Startups expanded exponentially over the past few years in China under generous state patronage, widening the gap with South Korea in new business dynamism.

According to the Bank of Korea (BOK), the number of start-ups per 10,000 population from January to September last year amounted to 32 in China, more than doubling 15 in Korea. The gap has been ever-stretching since 2013 when China first outpaced Korea in the number of new businesses per 10,000 people.

A total of 4.51 million corporations were newly established over the same period last year, almost 60 times more than 75,000 in Korea. The sustainability beyond the first year for Chinese startups was around 70 percent, compared with around 60 percent for Korean startups.

Capital investments to venture companies in China reached $40.8 billion, dwarfing $1.5 billion in Korea.

The number of so-called unicorn startups whose value exceeds $1 billion stood at 42, second behind the U.S. that has 99 of such entities.

The report also found that Chinese startups hired 6.3 people on average in 2016, more than 1.5 in Korea, 2.3 in the U.K., 1.7 in Germany and 1.3 in France. The Beijing’s entrepreneurial boom has been fueled by rapid e-commerce proliferation and government aid, according to the report.

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