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"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
"Innovation: the long quest for money"
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"Innovation: the long quest for money"

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  • Tekes – the Finnish Funding Agency for Technology and Innovation - is the main public funding organisation for research and development in Finland. Tekes funds industrial projects as well as projects in research organisations, and especially promotes innovative, risk-intensive projects. Tekes offers partners from abroad a gateway to the key technology players in Finland. National Institute of Science and Technology Policy (NISTEP) NISTEP was founded in 1988 as an affiliated research institute under the Science & Technology Agency. Its task is to conduct theoretical and empirical research on matters that would be the basis for developing Science & Technology policy. Besides this task of planning the government S&T policies by promoting S&T policy research with a comprehensive and long-term perspective, NISTEP also provides private companies with research results to assist them in formulating strategies for Research and Development. Foresight in the United States The Institute for the Future (IFTF) IFTF is an independent research firm, specialising in long-term forecasting, alternative futures scenarios and. impact of new products and next-generation technologies on society and business. The IFTF helps their clients plan their future by foretelling critical technological, demographic, and business trends. The research areas at IFTF are: Emerging Technologies; Strategic Planning; Health and Health Care. The International Energy Agency (IEA) acts as energy policy advisor to 26 member countries in their effort to ensure reliable, affordable and clean energy for their citizens. Founded during the oil crisis of 1973-74, the IEA’s initial role was to co-ordinate measures in times of oil supply emergencies. As energy markets have changed,so has the IEA. Its mandate has broadened to incorporate the “Three E’s” of balanced energy policy making: energy security, economic development and environmental protection. Current work focuses on climate change policies, market reform, energy technology collaboration and outreach to the rest of the world, especially major producers and consumers of energy like China, India, Russia and the OPEC countries. With a staff of around 150, mainly energy experts and statisticians from its 26 member countries, the IEA conducts a broad programme of energy research, data compilation, publications and public dissemination of the latest energy policy analysis and recommendations on good practices. Nordic Energy Research Program for Process Integratyion, NEFP The New Energy and Industrial Technology Development Organization (NEDO) was established by the Japanese government in 1980 to develop new oil-alternative energy technologies. Eight years later, in 1988, NEDO's activities were expanded to include industrial technology research and development, and in 1990, environmental technology research and development. Activities to promote new energy and energy conservation technology were subsequently added in 1993. Following its reorganization as an incorporated administrative agency in October 2003, NEDO is now also responsible for R&D project planning and formation, project management and post-project technology evaluation functions. Intelligent Manufacturing Systems IMS is an industry-led, international research and development (R&D) program established to develop the next generation of manufacturing and processing technologies. Companies and research institutions from Australia, Canada, the European Union and Norway, Japan, Korea, Switzerland, and the United States of America participate in this program. Other regions are encouraged to join. CRAFT Center for Research and Support for Training and its Technologies Ecole Polytechnique Federale de Lausanne IRC: The Informatics Research Center has three labs. The IRC has expertise available from many subject fields and conducts interdisciplinary informatics research in theoretical and application domains. The IRC organises its research activities in several labs and projects: Reading UK
  • Transcript

    • 1. Dominique Menu Head of the Representative Office in Ukraine From Science to Business October 2006 Innovation….. the long quest for money
    • 2. Innovation: from brainstorming to manufacturing
      • This diagram illustrates the different steps for an idea to coalesce into a prototype and then into a mass market product
      • As you can see, the key words for a financier here are RISK/REWARD. Which are the institutions or individuals ready to share this risk with you ?
    • 3. The virtuous cycle of private equity investment (source report to the Prime Minister of Finland (E U Presidency) Sept. 2006 )
      • The aim of this report is to analyze how to make Europe more competitive: banks and insurance companies get involved at a more mature stage. Why ?
    • 4. How do banks and insurance companies work ?
      • Where do they get their funds ?
      • Banks and insurance companies collect savings and cash of individuals and companies.
      • Our first duty is then to our depositors: we must make sure we can return their money at all times, as well as to earn a decent margin to cover our costs and to serve dividends to our shareholders.
      • How do we lend money ?
      • We assess the capacity of each and every borrower to service its debt to us, including in stress scenario.
      • Furthermore – and especially here in Ukraine, due to local regulations – we look to secure our position in taking “ security ” on the borrower’s assets.
      • In case of stress, we are therefore in a position – in principle - to execute our security and dispose of it in order to cover our potential loss.
      • Conclusion: traditional finance institutions do/should not engage in high risk / reward operations.
      • Regulatory authorities would also prevent us from doing so.
    • 5. Source of high risks money:
      • Which are today these sources ? we may regroup these in 3 major groups:
      • Business Angels : we are basically talking here about rich private individuals who are ready to invest much needed “ seed capital ” at a very early stage of development of a company, i.e. for new and speculative projects. Their role is extremely important, when we talk about raising money between USD 0.5 and 2 million.
      • Venture capital investors : these are usually private equity funds managed by professionals. They seek to identify and finance the rapid growth of high potential young firms that embrace innovative products, processes or technologies. This way, they generate substantial rewards from successfully overtaking existing business paradigms. Note that very often, traditional finance institutions do invest a small part of their funds into alternative investments such as these V.C. funds.
      • Last but not least, Governments : The first computers, the first commercial jet planes were built in the U.S.A. as funded by DoD contracts. The U.S.A and Europe have set up specific programs to promote new science and technology businesses. These are key tools in helping scientists to engage into new business ventures.
      • N.B. A business environment – laws, taxes, etc… – which encourages private and commercial investors to invest into risk taking ventures is an absolute prerequisite.
    • 6. Government first: U.S.A.
      • The U.S. example – the Small Business Innovation Research program
      • SBIR awards take the form of contracts for the development of technologies required by agencies of the US Government. They provide 100% of the funding needed plus a small profit element. The “norm” is USD 850 K for each project. Small business can win and run multiple projects in parallel. The SBIR analysis below is done for the UK Government in an attempt to copy and adapt it:
    • 7. Government first: U.S.A.
      • The U.S. example – the Small Business Innovation Research program
      • Established in 1982, it is the World’s largest seed capital program for science and technology business.
      • The law stipulates that 2.5% of all federal agencies’ external R&D research must be done through SBIR. Furthermore, the US has established a very large set of policies to favor small US businesses in government procurement.
    • 8. Government first: the European Union
      • The first program in Europe: COST – an international framework for European Co-operation in the field of Basic Scientific and Technical Research ( www.cost.esf.org )
      • Established in 1971, COST allows the co-ordination of nationally funded research by maximising European synergy and raising the level of scientific interaction at the scale of Europe. Its budget for the period of 2002-2006 was of 1.5 Billion Euro.
      • COST Actions cover basic and pre-competitive research. Ukraine as a Non-COST country took part in 15 actions.
      • From March 2006, Ukraine initiated consultation to discuss potential full membership.
    • 9. Government first: the European Union
      • The primary goal of EUREKA has always been to raise the productivity and competitiveness of European industry and national economies through its ‘bottom-up’ approach to technological innovation. Since its inception in 1985, substantial public and private funding has been mobilized to support the research and development carried out within the EUREKA framework.
      • Through its flexible and decentralized Network, EUREKA offers project partners rapid access to a wealth of knowledge, skills and expertise across Europe and facilitates access to national public and private funding schemes.
      • The internationally recognized EUREKA label adds value to a project and gives participants a competitive edge in their dealings with financial, technical and commercial partners.
      • Through a EUREKA project, partners develop new technologies for which they agree the Intellectual Property Rights and build partnerships to penetrate new markets.
      • Ukraine was granted full membership on 9 June 2006. Currently a total of 15 projects have been developed with Ukrainian participants for a total of 1.1 M. Euro.
      EUREKA – an international framework for European Co-operation in the field of Marketable Scientific and Technical Research ( www.eureka.be )
    • 10. Finland approach to fostering technology
    • 11. European approach to research support to SMEs: References sources: EU research programs ( internet )
    • 12. Some figures on how much money is raised:
      • The U.S. market is by far the biggest in the world (2005 estimates):
      • Business Angels investments: - USD 23.1 billion
      • Venture capital investments: - USD 22.7 billion
      • For other markets, we have only venture capital estimates for 2005 (source: Deloitte Global trend in venture capital 2006 survey):
      • Europe (EVCA): - USD 15.8 billion
      • United Kingdom: - USD 2.8 billion
      • Canada: - USD 1.5 billion
      • China : - USD 7 billion (2004 adjusted for PPP)
      • India: - USD 2.3 billion
      • Israel: - USD 1.3 billion
      • An extraordinary example: SKYPE funded by Mangrove Company (Luxemburg) bought by eBay for USD 2.5 billion.
      • N.B. Venture capital includes both investments in new technology companies, but as well traditional target companies seen as under-priced or inefficiently managed (MBO).
    • 13. Early stage development financing is not easy:
      • These figures illustrate the private equity return of the UK venture capital industry since its creation until 2004:
      • These statistics show clearly why private sector investors are so reluctant to invest at an early stage in science and technology businesses in the UK.
    • 14. Early stage financing in Central & Eastern Europe is …. tiny:
      • These statistics (data EVCA 2004) show clearly that so far private sector investors are not investing at an early stage in science and technology businesses in Central Europe.
      6,513 10,000 4,479 82,020 177,213 110,755 39,422 18,043 Total 2003 4,021 14,808 7,059 32,543 134,437 121,562 16,074 215,976 Total 2004 30,843 500 191,871 Buyout 25,204 59,494 20,684 Replacement capital 2,262 14,102 6,112 7,339 44,100 120,561 13,829 3,421 Expansion 1,759 706 947 501 2,245 Start-up Seed Slovenia Croatia Baltic States Slovakia Romania Poland Hungary Czech Republic Bulgaria Thousand Euros
    • 15. What do we do at BNP Paribas ?
      • BNP Paribas is one the world largest banks
      • 140.000 employees Worldwide (55.000 in France, Western Europe 40.000, USA 15.000) present on all 5 continents
      • AA rating (S&P Fitch) Aa2 (Moody’s)
      • 3 core businesses:
      • - Retail Banking France and International (IFRS)
      • Asset Management & Services (AMS)
      • Corporate & Investment Banking (CIB)
      • + BNP Paribas Capital, which regroups all activities related to investments in equity related transactions.
      • In Ukraine, since April 2006, BNP Paribas has bought a 51% interest in its new daughter bank:
    • 16. Dominique Menu Head of the Representative Office in Ukraine Thank you for your attention ! Any questions ? October 2006 My coordinates: dominique .menu@ bnpparibas .com Tel. +380 44 585 47 www.bnpparibas.com

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