Seoul Center for finanCe and innovationThe Effects of Matching Grants on Technology Startups: The Case of Korea’s TIPSPublic Disclosure AuthorizedPublic Disclosure AuthorizedPublic Disclosure AuthorizedPublic Disclosure Authorized © 2024 International Bank for Reconstruction and Development / The World Bank1818 H Street NWWashington DC 20433Telephone: 202-473-1000Internet: www.worldbank.orgThis work is a product of the staff of The World Bank with external contributions. The find-ings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of The World Bank, its Board of Executive Directors, or the governments they represent.The World Bank does not guarantee the accuracy, completeness, or currency of the data included in this work and does not assume responsibility for any errors, omissions, or discrepancies in the information, or liability with respect to the use of or failure to use the information, methods, processes, or conclusions set forth. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries.Nothing herein shall constitute or be construed or considered to be a limitation upon or waiver of the privileges and immunities of The World Bank, all of which are specifically reserved.Rights and PermissionsThe material in this work is subject to copyright. Because The World Bank encourages dissemination of its knowledge, this work may be reproduced, in whole or in part, for noncommercial purposes as long as full attribution to this work is given.Any queries on rights and licenses, including subsidiary rights, should be addressed to World Bank Publications, The World Bank Group, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522- 2625; e-mail: pubrights@worldbank.org. World Bank Group Finance, Competitiveness and Innovation Global PracticeThe Effects of Matching Grants on Technology Startups: The Case of Korea’s TIPSTIPS: Tech Incubator Program for StartupSeoul Center for finanCe and innovationjanuary 2024 AcknowledgmentsThe report is a collaboration between the World Bank Seoul Center for Finance and Innovation and the Korea Advanced Institute of Science and Technology (KAIST) Innovation Strategy and Policy Institute (ISPI). The research team was led by Anwar Aridi (Senior Private Sector Specialist, World Bank) and Wonjoon Kim (Professor, KAIST), which included Kibum Kim (Private Sector Specialist, World Bank), Kyeyoung Shin (Consultant, WB), Joo Sueb Lee (Senior Economist, WB), and Dae-hyun Kim, Taekyun Kim, and Hyunsung Park from KAIST.The note benefited from the guidance of the World Bank Management, Zafer Mustafaoglu (Practice Manager) and Jason Allford (Country Manager), and from feedback and comments provided by Xavier Cirera (Senior Economist) and Nelson Gray (Consultant). This knowledge note was made possible by a grant from the Korean Ministry of Economy and Fi-nance, provided through the Seoul Center for Finance and Innovation and the World Bank Group Korea Office. An earlier version of the data analysis was supported by the Basic Science Research Program through the National Research Foundation of Korea (NRF) funded by the Ministry of Edu-cation (2021R1A6A1A14045741).4The effecTs of MaTching granTs on Technology sTarTups: The case of Korea’s Tips ContentsAcknowledgments .........................................................................................................4Abbreviations and Acronyms ..........................................................................................6Executive Summary ........................................................................................................701. Introduction ............................................................................................................902. Development of Korea’s Entrepreneurial Ecosystem ...................................................1503. Overview of TIPS.....................................................................................................2004. Data and Methods ..................................................................................................2405. Results ..................................................................................................................3006. Conclusion and Policy Implications ..........................................................................39References ..................................................................................................................45Appendices .................................................................................................................50 A. Overall Process of the Tech Incubato