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BarCamp Hong Kong 2009 -- SERAP Funding for Start-ups

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BarCamp Hong Kong 2009 -- SERAP Funding for Start-ups

  1. 1. First-hand experiences with ITF SERAP programme Hong Kong Government Funding for Start-ups [email_address] @lissovski
  2. 2. Overview and Goals <ul><li>S mall E ntrepreneur R esearch A ssistance P rogramme </li></ul><ul><li>“ Technology upgrading in the industry, competitiveness of HK&quot; </li></ul><ul><li>Emphasis on the innovation, IP component </li></ul><ul><li>Pre-venture capital funding </li></ul><ul><li>Great for bootstrapped start-ups </li></ul><ul><li>Funds R&D only </li></ul><ul><ul><li>Equipment, tools, project staff salaries, other direct costs </li></ul></ul><ul><ul><li>Won’t pay for office space, marketing, trademarking, etc. </li></ul></ul><ul><li>Project duration up to 2 years </li></ul>
  3. 3. Eligibility <ul><li>Stand-alone HK incorporated company </li></ul><ul><li>Less than 100 employees </li></ul><ul><li>Normally at least two people </li></ul>
  4. 4. Funding <ul><li>Gov matches Co's contribution dollar-for-dollar </li></ul><ul><li>Up to HKD 4,000,000 </li></ul><ul><li>Co contributes cash or manpower </li></ul><ul><ul><li>Really means cash; cash pays for manpower </li></ul></ul><ul><li>Quarterly contributions and disbursements </li></ul><ul><li>Essentially unsecured interest-free loan </li></ul><ul><li>Repaid from proj-related revenue or follow-on investment </li></ul><ul><ul><li>5% of gross revenue </li></ul></ul><ul><ul><li>10% of follow-on investment </li></ul></ul><ul><ul><li>Until fully repaid </li></ul></ul>
  5. 5. Application Process – #1: Online Application <ul><li>“ Abstract” – 200 word elevator pitch </li></ul><ul><li>“ Other Information in Support of the Application” – extended pitch </li></ul><ul><li>5-slide “deck” </li></ul><ul><ul><li>Team, product / innovation, market, opportunity, competition </li></ul></ul><ul><li>Team CVs </li></ul><ul><li>Supporting materials </li></ul><ul><ul><li>Prototype screenshots, mock-ups, etc. </li></ul></ul>
  6. 6. Application Process – #2: Preliminary Meeting <ul><li>Meet with 2 ITC people for 1-2hrs </li></ul><ul><li>Must convince/intrigue them </li></ul><ul><li>Working prototype / proof of concept goes a long way </li></ul><ul><li>Revisions to the application suggested </li></ul>
  7. 7. Application Process – #3: Behind the Scenes <ul><li>ITC people from prelim meeting write a report </li></ul><ul><ul><li>You don’t see it </li></ul></ul><ul><li>2-3 subject matter experts selected from a pool </li></ul><ul><li>Application might be rejected at this stage </li></ul>
  8. 8. Application Process – #4: The Panel <ul><li>Meet about once a month </li></ul><ul><li>20-30 minutes per application </li></ul><ul><li>Intense Q&A with 2-4 panelists + chairman </li></ul><ul><ul><li>Market, opportunity, competition, innovation, go-to-market, etc. </li></ul></ul><ul><ul><li>Panelists far more informed than you might expect </li></ul></ul><ul><li>Yay/Nay decision same day </li></ul>
  9. 9. Yay. Next Steps <ul><li>Detailed project plan </li></ul><ul><ul><li>Quarterly milestones with concrete demonstrable progress </li></ul></ul><ul><ul><li>Itemized expenditures by quarter </li></ul></ul><ul><ul><li>Funding schedule </li></ul></ul><ul><li>Separate proj bank account </li></ul><ul><li>Funding agreement signed </li></ul><ul><li>Co’s first contribution, first Gov disbursement </li></ul><ul><li>Off to the races </li></ul>
  10. 10. During the Project <ul><li>ITC Case Officer assigned to the proj </li></ul><ul><li>Project Coordinator, Deputy Project Coordinator on the Co side </li></ul><ul><li>Typically quarterly milestones </li></ul><ul><ul><li>Progress reports online </li></ul></ul><ul><ul><li>In-person progress meeting </li></ul></ul><ul><ul><li>Scheduled contributions and disbursements </li></ul></ul><ul><li>Formal process for project changes </li></ul>
  11. 11. Project Completion <ul><li>Unused gov funds returned </li></ul><ul><li>+ gov’s portion of proj bank account interest </li></ul><ul><li>Proj bank account closed </li></ul><ul><li>Formal audit of the proj bank account </li></ul>
  12. 12. Observations <ul><li>Application process a significant effort </li></ul><ul><ul><li>By design </li></ul></ul><ul><li>Reasonable overhead during the proj </li></ul><ul><li>ITC people are genuinely there to help you succeed </li></ul><ul><li>Benevolent bureaucracy </li></ul><ul><ul><li>Process </li></ul></ul><ul><ul><li>Mission </li></ul></ul>
  13. 13. More info <ul><li>http://www.itf.gov.hk/eng/SERAP.asp </li></ul>

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