The Korea Startup Forum held its AXIS 2026 conference on June 11 at C-Square in Seoul’s Gangnam district. Industry participants called on the government to act as an early market for AI startups.

Jae-won Kim (김재원), chairman of the Korea Startup Forum, said what startups lack now is not ideas or technology but markets and first customers. He said Korea needs a structure in which dozens or hundreds of companies can compete and grow in the public sector market, rather than concentrating resources on a small number of firms.

Kim cited government support methods as a reason the market is lacking despite Korea having an environment suited to becoming an AI powerhouse. He said Korea is a country that broadly has five layers of an AI powerhouse, including energy infrastructure, HBM-centred semiconductors, an independent foundation model, data centre capability and international trust. Still, he said, possessing technology and using technology are different, and the government needs to shift its role from supporter to customer.

Kim also said that in 2016, Korea was ranked No. 1 in the ICT Development Index selected by the International Telecommunication Union, but fell behind in the platform transition. He said what Korea lacks most is entrepreneurship, and it is missing an attitude and culture that seize opportunities in uncertainty and do not fear failure. He argued that for such a culture to take root, the state must open the market first. He said it is important for startups to have a chance to be tested in a real market even if the public sector uses products first and then stops decisively if they lack value.

Businesspeople attending the event voiced the same view. Ji-hyung Han (한지형), chief executive of Autonomous A2Z, said technology itself is industry but early demand comes only from the public sector, and shared his experience of starting mainly through government-ordered demonstration projects. He said autonomous driving is not an area a company can do alone, and that without the government’s role in easing laws, systems and regulations and creating a consultative body for stakeholders, the market itself will not open.

Gyu-ra Kang (강규라), head of external cooperation at BonAI, said the market needs to be large to create industrialisation, and that requires problems to be large. She said the reason the company chose defence and disaster domains is that those are areas where a market is formed only when the state intervenes.

The government and the National Assembly expressed agreement on the first-customer role. Seung-hwan Mok (목승환), director-general for Startup and Venture Innovation at the Ministry of SMEs and Startups, said the government will push ahead with a government-first demonstration and purchase project in which the government and public institutions become AI startups’ first customers and take responsibility through technology demonstrations and purchases.

Hae-min Lee (이해민), a lawmaker from the Rebuilding Korea Party on the National Assembly’s Science, ICT, Broadcasting and Communications Committee, said the government’s current role is to create demand. Lee said the government does not need to do what the private sector should do, and the private sector must not do what the government should do.

Still, compared with the Ministry of SMEs and Startups, the policy direction of the Ministry of Science and ICT, which holds a large AI budget, has so far been focused on supporting a small number of firms and specific areas. Jin-soo Lee (이진수), director-general for AI Policy Planning at the ministry, said no country has a full stack across five layers like Korea, spanning power and energy, semiconductors, cloud infrastructure and AI models. He said that as AI matures, business success is expected to come largely from the service side.