The five-year survival rate of domestic startups is 30

The five-year survival rate of domestic startups is 30-35%. In other words, 6 to 7 out of 10 places close soon. Many start-ups disappear without producing clear results after exhausting initial subsidies for start-ups. As such, the domestic start-up ecosystem is growing rapidly, but many entrepreneurs are still having difficulty connecting ideas to "money businesses."

In response, Shin Yong-hui, CEO of Platform Works, who consults on entrepreneurs and corporate commercialization strategies, said, "It's a sweet fantasy that you only need one idea," and diagnosed, "Most of these founders create something that the market doesn't need." CEO Shin is a platform expert who has led the development of new businesses and services in Cyworld, CJ ENM, TVing, and Lotte Members. He recently published "Why Your Ideas Don't Make Money," which contains 20 years of new business know-how.

◆ Go through three steps to verify profitability

As a way to build a profitable business model, CEO Shin suggested △defining problems before ideas △advanced customer verification by repeating customer verification △using artificial intelligence (AI) as a verification tool.

First, CEO Shin pointed out that many prospective entrepreneurs are doing wrong from the start. "Customers are cool to those who seek their wallets, but they are fans to those who solve problems," he said. In other words, only businesses that scratch customers' itchy spots can be on the path to success, not just to make more profits or to start a business out of dissatisfaction with the current job.

Next, CEO Shin stressed that the problem should be verified through customer interviews and beta tests to see if it works in the actual market. The important thing in this process is to narrow the scope of the customer and verify it. A representative success story is the timetable app 'Everytime'. It has grown into a service currently used by more than 4 million college students, but it started with solving the inconvenience of Seoul National University students writing a timetable. Carrot Market also initially tested the service for Pangyo office workers. CEO Shin explained, "We need to check customer reactions, reflect feedback, and upgrade services in a small but dense market."

Another method is to quantify, compare, and analyze problems using Generative AI. CEO Shin said, "You can quickly check your business feasibility with a simple prompt," and ordered to actively utilize RICE (Reach, Impact, Confidence, and Effort) analysis. It is a method of prioritizing projects by evaluating the scope of reach, influence, confidence, and input efforts. CEO Shin said, "Now, we can do a lot of market research, competitor analysis, and even simple app development with just a few prompts. AI can be a great co-founder who verifies the founder's ideas."

Finally, to office workers who dream of starting a business, CEO Shin advises, "The workplace is the best business school." CEO Shin said, "We should not look at the inefficiency and dissatisfaction experienced by the company as stress, but as the best field data that can be used by learning AI." "There are large and small bottlenecks hidden in the work process involving numerous stakeholders," he said. "Finding a way to solve the inconvenience itself can be a new business item."