Government to Select 10,000 for '2nd Everyone's Startup': Tiered Support Ranging from 2 Million Won in Activity Funds up to 1 Billion Won
Jointly Announced by Ministries at August 13 Emergency Economic Headquarters Meeting; Applications Open on August 20, with Over 70% Non-Metropolitan and 80% Pre-Founder Selection; Funding and Commercialization Policies for the Second Week of August Summarized, Including New Special Guarantees for Credit-Vulnerable Small Businesses

The government is launching the '2nd Everyone's Startup Project,' which will select 10,000 startup challengers and provide each with 2 million won in startup activity funds and initial mentoring. The Ministry of SMEs and Startups (MSS) jointly announced the promotion plan during the Emergency Economic Headquarters and Economic Ministers' meeting held on August 13, 2026, presided over by Deputy Prime Minister and Minister of Finance and Economy Koo Yun-cheol. Applications will open on August 20, followed by the announcement of successful applicants in early October and initial mentoring running through November. During the same week, the MSS confirmed plans to introduce special guarantees for credit-vulnerable small businesses and held a major debate on regulatory innovation, rolling out a series of startup and small business policies. Below is a summary of the core content and application strategies for the funding and commercialization support policies announced in the second week of August.

2 Million Won for 10,000 Startup Challengers… Up to 1 Billion Won Through Auditions

The framework of the 2nd Everyone's Startup Project focuses on 'expanding the selection scale' and 'tiered upward support.' The government doubled the number of selected participants from 5,000 in the first project last March to 10,000 in this second phase, consisting of 8,000 in general and technology fields and 2,000 in the local field. All selected challengers will receive 1-on-1 initial mentoring, 2 million won per person in startup activity funds, and support for using artificial intelligence (AI) solutions. Notably, the startup activity funds can be used for online payment gateway (PG) services upon submitting separate supporting documents, and subscription costs for overseas AI solutions such as ChatGPT are also eligible (based on the MSS announcement on August 13, 2026).

Support increases through higher tiers via an audition format. Among the challengers who complete initial mentoring, 2,200 will advance to regional auditions, comprising 1,000 in general and technology fields and 1,200 in the local field. They will receive up to 20 million won per person in initial commercialization funds, coupled with cutting-edge graphics processing unit (GPU) support from the Ministry of Science and ICT, as well as customized export training and trade statistics utilization programs from the Korea Customs Service. Opportunities for regulatory inspections, mentoring from senior entrepreneurs and tech experts, and participation in guarantee and investment investor relations (IR) sessions will also be provided. A total of 400 challengers—200 each from general/tech and local fields—will advance to the final national contest. Depending on contest scores and other factors, participants can receive up to 1 billion won combined in prize money and investment, followed by subsequent commercialization and overseas expansion support.

The selection principles are also clear. Staying true to the project's objective, the government decided to allocate over 80% of total selectees to pre-founders and over 70% to non-metropolitan founders, aiming to spread a startup ecosystem heavily concentrated in the capital region out to local areas. For reference, the 1st project last March received approximately 63,000 applications—the highest ever for a government startup and idea contest—with 68% of applicants aged 39 or younger and 53.4% located outside the capital region (based on MSS announcement data from August 2026).

Re-founding Threshold Expanded from '3 to 7 Years'… Enhanced Screening Fairness via AI Plagiarism Checks

The most prominent operational change in this second plan is the expansion of application eligibility. Previously, only pre-founders and those who started a business within the past 3 years were eligible to apply, but the pool has now been widened to include re-founders within 7 years of business commencement. This brings back into the fold entrepreneurs attempting a second challenge a considerable time after experiencing a closure. Challengers who were eliminated in the 1st project can also receive bonus points in the selection process if they complete re-challenge mentoring and reapply with improved ideas.

The evaluation system has been substantially overhauled. Joint evaluations by three mentors and the operation of evaluation committees for each incubation center have been made mandatory, alongside the introduction of AI generation rate checks and plagiarism verification using external data such as thesis papers and contests. Evaluators are now required to review the video submissions of applicants, and a lower limit has been set requiring evaluation comments provided to applicants to be at least 200 characters long. Application form sections are subdivided from 3 items up to 6 items, including items evaluating preparedness and re-challenge status. Incubation centers will increase from 119 in the first phase to approximately 170 in the second phase, involving some 60 large and mid-sized enterprises, accelerators (ACs) and venture capital (VC) firms, 20 public institutions, and 80 universities and private organizations.

Another notable aspect is the capitalization of participation history. The government plans to issue a 'Challenge Career Certificate' officially recognizing participation in Everyone's Startup as official career experience, expanding its utility so that certificate holders can receive bonus points or preferential interest rates when participating in other startup support programs, loans, or research and development (R&D) projects. This means that even if challengers do not reach the final stage of the audition, participation itself can act as an advantage in subsequent policy funding and support program applications.

Specialized Leagues Established for Social Ventures, Global, Universities, and Youth

The 2nd project newly introduces specialized leagues that broaden startup fields and target participants. The 'Social Innovation Social Venture League' was newly established to discover startups resolving social issues such as local community care gaps, employment, energy, productivity for small and medium-sized enterprises (SMEs) and small business owners, and waste. It will support the final 10 selected companies with up to 150 million won each in commercialization funds. The 'Global League' for entrepreneurs aspiring to expand overseas will select a total of 80 individuals—40 in the United States, 20 in Singapore, and 20 in India—providing up to 30 million won in commercialization funds, local settlement programs, and global mentoring.

In addition, a 'University League' involving startup clubs from startup-centered universities nationwide and a 'Youth League' involving 280 youth teams will be operated. Startup communities will be established in four regions including Seoul, Daejeon, Busan, and Gwangju, and nationwide 'Challenge IR' sessions linked with TIPS (Tech Incubator Program for Startup) operators are planned to be held more than 300 times. Platform security will also be overhauled entirely. Information included in application programming interfaces (API) will be minimized, abnormal access detection and blocking and encryption will be strengthened, and personal information retention and disposal standards as well as startup idea management systems will be reorganized.

Credit-Vulnerable Small Business Special Guarantees Established… Financial Safety Net Reinforced

Alongside startup support, reinforcement of the small business financial safety net took place the same week. According to the MSS, Second Vice Minister Lee Byung-kwon visited the Korea Credit Guarantee Foundation on August 11 to inspect the operational status of the regional credit guarantee system. At the meeting, the Foundation announced plans to strengthen counseling and guarantee support for small businesses experiencing management difficulties, rapidly clear non-performing loans (NPLs), and expand financial support by establishing special guarantees for credit-vulnerable small businesses (based on the MSS announcement on August 11, 2026). Vice Minister Lee stated that the government will back the timely supply of necessary financing tailored to the demands of local small businesses.

This is an extension of the small business recovery and restart support momentum unveiled in late July. Based on data from approximately 3 million small business owners utilizing loans, the MSS is proactively monitoring signs of management crisis. When crisis signals are detected, it guides small businesses to customized support programs before distress deepens, and seamlessly links policies of related agencies such as the Hope Return Package, debt adjustment, and micro-loans (based on the MSS policy meeting on July 29, 2026). Furthermore, from mid-August through October, 'On-the-Road Comprehensive Consulting Sessions for Small Businesses' will be held sequentially across 15 provincial local governments, providing 1-on-1 customized counseling covering financial support, management diagnosis, business closure procedures, debt adjustment, and employment or re-founding.

Policy Background: Second-Half 'Growth Ladder' Stance and Regulatory Innovation Drive

These announcements are read as implementation measures following the joint work report for the second half of 2026 conducted by the MSS, the Ministry of Employment and Labor, and the Fair Trade Commission on August 4. At that time, the MSS presented the establishment of an 'SME Growth Ladder' stretching from startups to global expansion and re-challenges as a policy goal for the second half of the year. It previewed a large-scale packaged support system providing up to 40 billion won per company over 5 years by selecting climate tech, manufacturing AI, pharmaceutical biotech, new security industries, and K-consumer goods as national new growth sectors. The report also included plans to foster 3,000 promising regional enterprises as national representative leapfrog companies and additionally designate six startup cities (based on the second-half work report by the MSS on August 4, 2026).

First-half indicators support this expansionary stance. Venture fund formation in the first quarter of this year reached 4.4 trillion won, a 30.7% increase compared to the same period last year and an all-time high, while venture investments rose 24.1% to 3.3 trillion won. SME exports for the first half recorded an all-time high of 64 billion dollars (based on MSS first-half work report data for August 2026). Adding to this, the 'SME, Venture, and Startup Regulatory Innovation Grand Debate' was held at the Korea Federation of SMEs in Seoul on August 12, continuing discussions on site-specific regulatory improvements. This move aligns with second-half regulatory reform tasks, such as introducing a regulatory impact assessment system to pre-review the impact of newly established regulations on startups.

Application Strategy: Checkpoints by Category

For aspiring founders, the 2nd Everyone's Startup application starting August 20 is the top priority for consideration. With over 80% of total selections allocated to aspiring founders, the entry barrier is low, and even in the event of elimination, assets such as a Challenge Career Certificate and re-challenge bonus points remain. Since application forms have been subdivided from 3 items to up to 6 items and AI generation and plagiarism checks have been introduced, it has become crucial to substantiate preparedness with concrete evidence and write in one's own voice.

For prospective re-founders with business closure experience, the relaxation of qualification requirements is decisive. With applications now open to re-founders within 7 years of business commencement, opportunities have opened up for second-challenge entrepreneurs who were previously excluded due to the 3-year threshold. If located outside the capital region, the advantage of the 70% or higher regional quota is added. It is also worth noting that applicants with local-based business items have a structure in the local field (2,000 selectees, 1,200 advancing to regional auditions) that is relatively advantageous in terms of the audition advancement ratio compared to general and technology fields.

Teams with social problem-solving items can separately target the newly established Social Venture League (10 companies, up to 150 million won), while teams preparing for overseas expansion can target the Global League (80 individuals, up to 30 million won). Meanwhile, existing small businesses facing financial difficulties should keep an eye on the Korea Credit Guarantee Foundation's announcement regarding the establishment of special guarantees for credit-vulnerable small businesses, and efficiently utilize the On-the-Road Comprehensive Consulting Sessions starting in mid-August to receive financial support, debt adjustment, and restart programs all at once through a single consultation. Detailed notices and application methods can be found on the K-Startup website and the homepages of small business-related organizations.