[Yeongju = E-Daily Marketin Soyoung Park Reporter] Isan-myeon is located a considerable drive from the downtown area of Yeongju, North Gyeongsang Province. As you drive along the quiet village roads, an abandoned school situated on a spacious lot comes into view. A performance hall now stands on the playground, which was once bustling with students, and in what used to be classrooms, young people are gathered in small groups, busy drawing, preparing for plays, or practicing songs and dances. In one corner of the building, the neighborhood’s only café is preparing to open.

This is the “Sobaeksan Art Village,” created with sponsorship from local companies such as Goryeo Ready-Mix Concrete, which has supported the construction industry in the Yeongju and Bonghwa regions of North Gyeongsang Province for about 40 years. Selected as a site for the Ministry of the Interior and Safety’s “Youth Village Creation Project”—designed to stem the outflow of local youth and support young people from outside the region in settling here—it has already undergone one round of experimentation in regional revitalization.

Yeongju, once cited as a benchmark for urban regeneration by local governments nationwide, is now preparing to take the next leap forward. Moving beyond the local government’s role of creating spaces and improving infrastructure, there is a growing movement to foster a local venture ecosystem where private capital and entrepreneurs enter the region, stimulating economic activity and creating new businesses.

Yeongju is home to several startups founded by young locals, such as Cho Guk-won, CEO of Cloud Cultures, who operates the Sobaeksan Art Village. Notable examples include the village enterprise “Namsan Seonbi Village,” the performing arts group “Serotonin Art Troupe,” and the global fruit-specialized agricultural company “DS Foods.” There is also the wellness company “Sayu’s Garden,” whose founders have family roots in Yeongju.

Infrastructure Improvements Centered on Urban Regeneration Projects

As the Lee Jae-myung administration actively pursues regional revitalization policies, the Regional Growth Fund has begun full-scale operations this year. In the Daegu-Gyeongbuk region, which includes Yeongju, a master fund is set to be established with a minimum scale of 125 billion won, funded by a 75 billion won investment from the parent fund. The goal is to create a structure where capital circulates within the region by establishing sub-funds and project funds that invest in local companies.

Yeongju has been implementing a pioneering urban regeneration project since 2014. As the population declined due to a drop in rail ridership and the economic decline of the region, the city revitalized the old downtown area, which had been left with only an aging population. It improved the residential environment and remodeled aging facilities. Village enterprises based on local specialties—including △apples, △ginseng, △scholar culture, △railways, and △Hanwoo beef—were established and led by both seniors and young people.

Centered around the Yeongju Urban Regeneration Center, the city involved private-sector experts to connect the administration with residents and oversee the entire process. Kim Hee-hyun, Executive Director of the Yeongju Urban Regeneration Center, stated, “Urban regeneration projects serve as a catalyst; to achieve full revitalization, we must identify linked initiatives through inter-departmental collaboration.” He added, “We formed a consultative body to coordinate projects that had previously been handled sporadically by individual departments.”

Jungang Market once served as the heart of Yeongju’s old downtown commercial district. As recently as 10 years ago, it had deteriorated into a run-down market lined with vacant storefronts featuring broken windows and crumbling facades. Subsequently, through the Urban Regeneration Pioneer Project conducted from 2014 to 2017, the market’s exterior and common spaces were renovated. By introducing cultural programs such as youth workshops and busking, it was transformed into a market centered on crafts and the arts.

However, the atmosphere at Central Market on the eve of the weekend was quite different. Although it should have been bustling with tourists and residents doing their shopping, the interior of the market was quiet. Centered around the plaza, abandoned storefronts are scattered throughout the area. This is not limited to Central Market; there are quite a few similar cases in various parts of the region that have emerged as key facilities through urban regeneration projects. This is why critics point out that it is difficult to sustain regional revitalization through public-led space development alone.

Moving Beyond Space Development to Attracting Private Capital and Building a Startup Ecosystem

Yeongju has turned its attention to the private sector. By bringing together youth entrepreneurship, private investment, and local brands, the city is building a venture ecosystem where businesses grow within the region and capital flows back into the local economy.

A prime example is the youth startup space “STAXX.” Launched in September 2022, it is a space created through a partnership between Impact Square—a firm specializing in impact measurement and management—and SK Materials (now SK Specialty). At the time, Impact Square also established a social venture investment fund worth 5 billion won.

What sets STAXX apart from existing urban regeneration spaces is that it does not merely provide a place for young people to stay. It is building a structure that identifies and nurtures local companies before connecting them with investment opportunities.

Recently, “Onchuma,” a small hanok brand for pets that received consulting from Stacks, advanced to the second round of the first cohort of the Ministry of SMEs and Startups’ “Startup for All” program. Private investment firms and corporate capital are flowing into a space created through a public urban regeneration project, and within that environment, young people from Yeongju are directly transforming local resources into viable businesses.

The Yeongju case demonstrates how the core focus of regional revitalization policies is shifting from subsidies and space creation to the supply of investment capital and the establishment of a self-sustaining investment ecosystem. Heo Ji-hoon, a member of the North Gyeongsang Provincial Council who is originally from Yeongju and serves as a youth proportional representative for the People Power Party, said, “I believe it is the role of the political sphere to fill basic infrastructure gaps and create conditions that allow young people to choose whether to stay in the region or leave, thereby enabling them to remain here.”

Do Hyun-myung, CEO of Impact Square, emphasized, “While large cities can attract high-tech industries such as AI data centers and semiconductors, this is realistically difficult for small and medium-sized cities,” adding, “We must create competitive advantages—such as attracting startups and foreign talent—to stand a chance against large cities.”