The number of venture firms in South Korea plummeted in the May-December period of last year as economic uncertainties sapped entrepreneurship, industry data showed Tuesday.

A total of 850 venture firms closed down in the eight-month period in 2011, compared with a gain of 2,351 startups during the earlier four months, according to the data by the Korea Exchange and the Korea Venture Business Association.

The number of venture firms grew a mere 6.1 percent on-year in 2011, compared with a 30.4 percent surge a year earlier. The figure had grown by double digits since 2005, the data showed.

The sharp slowdown came as Asia’s fourth-largest economy cooled in the second half of last year, dented by a global economic downturn stemming mainly from the eurozone debt crisis.

Experts said more attention should be paid to venture firms’ bleaker long-term outlook. The data showed that the proportion of those with technology patents also fell to 12.7 percent last year from 17.9 percent in 2009.

As industries scaled back their investment on jittery market conditions, venture firms had fewer chances to raise funds or get other kind of support from them, they added.

According to the main bourse, the number of South Korean venture firms registered with the tech-heavy secondary KOSDAQ market stood at 303, or 0.12 percent of around 26,000 in total. 

(Yonhap News)