[Baek Jongmin's Deep Check] One Year of the Lee Jaemyung Administration: Expanding Pathways for Startups at Government-Funded Research Institutes

Legal and Institutional Barriers to Entrepreneurship Lowered
Growing Expectations for Startups by Government-Funded Research Institute Researchers

"Are you saying that researchers will be able to own shares in their startup companies?"


"Researchers will also be allowed to take a leave of absence or hold concurrent positions."


"So, most of the hurdles that researchers at government-funded research institutes faced when starting businesses have disappeared."

This is a recent conversation among senior officials from the government and government-funded research institutes. The response from the field is that longstanding bottlenecks in the commercialization of science and technology are finally being resolved.

In the science and technology research and development (R&D) policy of the Lee Jaemyung administration, which marks its first anniversary, support for deep-tech startups at government-funded research institutes is regarded as a representative example of government policy being implemented on the ground. The revision of the Technology Transfer Act, discussions on special exemptions to the Conflict of Interest Prevention Act, support from the Ministry of Science and ICT, and the entrepreneurship track designed by the National Research Council of Science & Technology (NST) commercialization task force are all coming together to enable researchers to actually launch startups. The move is intended to ensure that research outcomes are not limited to papers and patents, but are connected to companies and job creation.

Until now, starting a business was possible for researchers at government-funded institutes, but it was a risky choice. Laboratories possessed technology. There were papers and patents. However, there were many obstacles to launching a company based solely on technology. Researchers on the ground were unsure whether they could hold equity in the startup, whether they could take a leave of absence and return, whether they could concurrently serve as executives or employees of the startup, or under what conditions they could acquire technology owned by their institute.

Researchers were also anxious about whether they could return if they left their stable labs to start a business following government policy and then failed. There were concerns that holding shares in the startup could be interpreted as a conflict of interest. Even when trying to found companies based on technology from public research institutes, each institution had different rules and interpretations.

Participants of the Deep Tech Startup Planning Camp for Government-Funded Research Institutes held last January are taking a commemorative photo.

With the government marking its first year in office, the fact that the "hurdles" faced by researchers at government-funded institutes in starting businesses are rapidly disappearing is a significant change. On April 23, the National Assembly passed a partial amendment to the Technology Transfer Act.

The key point of this amendment is the restructuring of the holding company and subsidiary structure for public research institutes. The requirement for public research institute holding companies to own more than 50% of issued shares will be relaxed to more than 30%. The equity requirement for establishing or incorporating subsidiaries of holding companies will be lowered from at least 20% to at least 10%. The provision that limited the technologies owned by holding companies to green or advanced technologies will also be deleted.

However, not all barriers have disappeared simply with the revision of the Technology Transfer Act. Researchers at government-funded institutes are both researchers and public officials affiliated with public institutions. For this reason, the Conflict of Interest Prevention Act has been a barrier to starting businesses. Holding equity in a startup or engaging in external activities could be interpreted as a matter of private interest.

Assemblyman Cho Incheol of the Democratic Party of Korea sponsored five comprehensive amendment bills to address this, introducing special exemption provisions for the Conflict of Interest Prevention Act in the laws governing government-funded research institutes in the science and technology sector and the four major science and technology institutes. According to Assemblyman Cho's office, the number of startups launched by researchers at government-funded research institutes decreased from 62 cases in 2020 to 25 cases in 2024 after the Conflict of Interest Prevention Act came into effect, which was stated as the reason for proposing the bills.

Lee Eunyoung, Director of Research Achievement Innovation at the Ministry of Science and ICT, said, "In line with discussions in the National Assembly, we will actively support efforts to reduce uncertainties related to conflicts of interest that researchers at government-funded institutes face in the startup process, so that research-based entrepreneurship can lead to industry development and job creation."

Even if the laws that previously blocked entrepreneurship change, the path to starting a business remains long. Deep-tech startups, which are based on advanced technologies, follow a different timeline compared to typical service-based startups. It requires a long period for prototype development, regulatory approval, clinical trials, technology transfer negotiations, and fundraising. These are especially challenging areas for researchers who have built their careers in laboratories.

The case of the NST commercialization task force, which is responsible for government-funded research institutes under the Ministry of Science and ICT, shows what researchers need to successfully launch startups in practice.

The task force collected the entrepreneurial demands and institutional challenges faced by researchers at government-funded institutes and designed a dedicated track tailored to the business structures of each ministry and specialized agency. Since it is difficult for individual institutes to fill institutional gaps by separately approaching the Ministry of SMEs and Startups, the Ministry of Science and ICT, and the Korean Intellectual Property Office, the NST took on the role of a comprehensive technology transfer office (TLO) and established a cross-ministerial cooperation structure.

The results were clear. Among the 10 teams that advanced to the finals of last year's "Challenge! K-Startup" researcher league, six were researchers from government-funded research institutes who had participated in the NST startup planning program.

The task force's role extends to "planned entrepreneurship," involving the selection of business items, diagnosis of development stages, product design, and the allocation of CEO and CTO roles. "Convergent entrepreneurship," which combines researchers and technologies from different government-funded institutes, is also possible. A notable example is "BLOOM," an early bladder cancer diagnosis kit using urine, developed by researchers from the Korea Institute of Science and Technology (KIST) and the Korea Institute of Machinery and Materials.

Now that the government has prepared the framework, it is time for researchers to take on the challenge on this foundation. If researcher-founded startups grow into global deep-tech companies, their achievements will feed back into the national R&D ecosystem. The Korean R&D ecosystem looks forward to the contributions of researchers who will lead the quantum leap.

This content was produced with the assistance of AI translation services.