Majority of Platform Startups are Negative about the Platform Fair Competition Promotion Act

Startup Alliance has released the results of the ‘Perception Survey on the Impact of the Platform Fair Competition Promotion Act on the Startup Ecosystem’. The survey was conducted by the Korea Fair Trade Commission (KFTC) to directly understand the views of startups on the impact of the Platform Fair Competition Promotion Act on the startup ecosystem. The survey was conducted over a five-day period from 22 to 26 January among 106 representatives, founders and co-founders of domestic startups. on the startup ecosystem. The survey was conducted over a five-day period from 22 to 26 January among 106 representatives, founders and co-founders of domestic startups.

As a result of the survey, 52.8% of respondents said that the Platform Competition Promotion Act will have a negative impact on the startup ecosystem. Only 14.1% said the Act would have a positive impact on the startup ecosystem. Among platform startups, 54.4% of respondents expressed a negative perception of the Platform Fair Competition Promotion Act. The KFTC’s claim that the Platform Fair Competition Promotion Act will develop the industry ecosystem by protecting small and medium-sized platforms and startups from dominant platforms is significantly different from the actual perception of startups.

When asked how the Platform Fair Competition Promotion Act will specifically affect the startup ecosystem, 50.9% of respondents said, “If unprofitable startups are regulated because they have large transaction sizes or large numbers of users, the J-curve growth engine will decrease.
This was followed by “Global platform companies such as Google and Netflix will become more influential in Korea, while domestic platform companies will be regulated” (45.3%), “It is not clear which startups will be regulated due to the wide range of criteria to be applied, so startups should always be prepared for regulatory risks” (39.6%), and “It will be difficult for startups to exit or receive investment through platform companies” (32.1%).