The document discusses various entrepreneurship incentives available in Turkey. It outlines financing options such as angel investors, venture capital, and programs run by organizations like KOSGEB, TUBITAK, and the Ministry of Industry and Trade. KOSGEB offers support through programs focused on SME projects, R&D, innovation, entrepreneurship, cooperation between SMEs, and more. TUBITAK supports industry R&D projects through programs such as TEYDEB 1501, 1503, 1507, and 1508. The European Union also provides funding opportunities through programs like EUREKA and the EU Framework Programmes.

1. Entrepreneurship
Incentives in Turkey
STPS 517 Innovation and SMEs
Instructor: Dr. Erdal AKDEVE
Burak OĞUZ
01.11.2010

2. Outline
 What is Entrepreneurship?
 Classical Financing Options
 Angel Investors
 Venture Capital Investors
 Financing Options in Turkey
 KOSGEB
 TUBITAK
 European Union Framework Programmes
 TTGV
 Ministry of Industry and Trade
 Ministry of Finance
 TPE
 Other Incentives

3. Entrepreneurship
 Schumpeter
 The entrepreneur did not bear risk: the capitalist did.
 Frank Knight (1921) and Peter Drucker (1970)
 Entrepreneurship is about taking risk. The behavior of the
entrepreneur reflects a kind of person willing to put his or
her career and financial security on the line and take risks
in the name of an idea, spending much time as well
as capital on an uncertain venture.

4. Entrepreneurship
 Risk, which is measurable statistically (such as the
probability of drawing a red color ball from a jar
containing 5 red balls and 5 white balls).
 Ambiguity, which is hard to measure statistically
(such as the probability of drawing a red ball from a
jar containing 5 red balls but with an unknown
number of white balls).
 True Uncertainty or Knightian Uncertainty, which is
impossible to estimate or predict statistically (such
as the probability of drawing a red ball from a jar
whose number of red balls is unknown as well as
the number of other colored balls).

5. Entrepreneurship
 The entrepreneur is widely regarded as an integral player in the
business culture of American life, and particularly as an engine
for job creation and economic growth.
 Robert Sobel published The Entrepreneurs: Explorations Within
the American Business Tradition in 1974.
 Zoltan Acs and David Audretsch have produced an edited
volume surveying Entrepreneurship as an academic field of
research, and more than a hundred scholars around the world
track entrepreneurial activity, policy and social influences as part
of the Global Entrepreneurship Monitor (GEM) and its associated
reports.

6. Angel Investors
 An angel investor or angel is an affluent
individual who provides capital for a business
start-up, usually in exchange for convertible
debt or ownership equity. A small but
increasing number of angel investors
organize themselves into angel groups or
angel networks to share research and pool
their investment capital.

7. Angel Investors
 In the U.S. average angel funding was
450.000 $ in 2007.
 Software (%27)
 Medical and healthcare (%19)
 Biotech (%12)
 Rest is equally divided into high-tech.

8. Venture Capital
 Venture capital (VC) is financial capital
provided to early-stage, high-potential,
growth Startup companies. The venture
capital fund makes money by owning equity
in the companies it invests in, which usually
have a novel technology or business model in
high technology industries, such as
biotechnology, IT, Software etc.

9. Venture Capital
 In addition to angel investing and other seed funding options,
venture capital is attractive for new companies with limited
operating history that are too small to raise capital in the public
markets and have not reached the point where they are able to
secure a bank loan or complete a debt offering. In exchange for
the high risk that venture capitalists assume by investing in
smaller and less mature companies, venture capitalists usually
get significant control over company decisions, in addition to a
significant portion of the company's ownership (and consequently
value).
 In 2009, Venture capital is also associated with job creation
accounting for 21% of US GDP

10. Venture Capital
There are typically six stages of financing offered in Venture Capital,
that roughly correspond to these stages of a company's
development.
 Seed Money: Low level financing needed to prove a new idea
(Often provided by "angel investors")
 Start-up: Early stage firms that need funding for expenses
associated with marketing and product development
 First-Round: Early sales and manufacturing funds
 Second-Round: Working capital for early stage companies that
are selling product, but not yet turning a profit
 Third-Round: Also called Mezzanine financing, this is expansion
money for a newly profitable company
 Fourth-Round: Also called bridge financing, 4th round is intended
to finance the "going public" process

11. KOSGEB
 KOSGEB is a subdivision of Ministry of Industry and
Trade.
 Main support mechanism for SMEs.
 Incentives are;
 SME Project Support Program
 Thematic Project Support Program
 Cooperation Support Program (İşbirliği - Güçbirliği)
 R&D, Innovation and Industrial Application Support Program
 Entrepreneurship Support Program
 General Support Program
 TEKMER Program
 Competitiveness and Innovation Framework Program

12. KOSGEB
SME Project Support Program
 Aim
 Support enterprises to solve their problems on
their own with creating new projects about their
problems.
 Establish project culture and consciousness to
SMEs.
 Increase project management capacities of
SMEs.

13. KOSGEB
SME Project Support Program
 Project Scope and Incentives are
 Program duration: 3 years
 Project duration: 6-24 months
 Max. Donation limit: 150.000 TL
 Support ratios: % 50 for 1st and 2nd regions -
%60 for 3rd and 4th regions
 Manufacting, management, organization,
marketing, export, HR, financial projects
about enterprise

14. KOSGEB
Thematic Project Support Program
 Aim;
 Support SMEs and Chambers to produce projects
to develop SMEs
 Fulfill the thematic sectoral and regional needs
pointed by macro strategy document
 To adapt SMEs to international legislations

15. KOSGEB
Thematic Project Support Program
 This program contains two types of
subprogram
 Invited thematic support program
 Chambers project support program
 In invited thematic support program, appliers,
all durations and max donations are specified
in invitation.
 In chambers project support program it is 24
months with 150.000 TL max donation limit.

16. KOSGEB
Cooperation Support Program
 Aim;
 Increase cooperation culture among SMEs
 To solve problems like marketing, competition
weakness, low capacity usage, finance in SMEs
 To increase competitiveness and capacity of
SMEs
 Resource utilization with scale of economics
 At least 5 SMEs with several partnership
models.

17. KOSGEB
Cooperation Support Program
 Supported topics are;
 Fast and cheap acquisition of logistic and raw materials
 New designs according to customer and market needs.
 Increasing international market share by increasing quality.
Create brands and shared marketing
 Shared labrotories to increase product and service quality
 Increasing quality, variety, efficiency with shared
production and services

18. KOSGEB
Cooperation Support Program
 Project Scope and Incentives
 Project scope: 6-24 months
 Max donation: 250.000 TL (no payback),
500.000(with payback)
 Support ratios: % 50 for 1st and 2nd regions -
%60 for 3rd and 4th regions

19. KOSGEB
R&D, Innovation and Industrial Production
Support Program
 Aim;
 To develop SMEs and entrepreneurs with scientific and
technologic ideas
 To increase R&D conciousness of SMEs
 To develop current R&D incentives
 To support innovative activities
 To industrialize project outputs of R&D and innovative
activities
 This program contains 2 subprograms.
 R&D and Innovation Program (12-24 months + 12 months)
 Industrial Production Support Program (18 months + 12
months)

20. KOSGEB
R&D, Innovation and Industrial Production
Support Program
R&D and Innovation Support
Program
Max Donation (TL) Support Ratio (%)
Workshop Support No Cost
Rent Support 12.000 75
Machinery Support(no payback) 100.000 75
Machinery Support(with payback) 200.000 75
Personnel Support 100.000 75
Startup Capital Support 20.000 100
Project
Development
Support
Consultancy 25.000
75
Education 5.000
IPR Support 25.000
Dissemination 5.000
International Fair,
Congress Support 15.000
Test, analysis and
certification 25.000

21. KOSGEB
R&D, Innovation and Industrial Production
Support Program
Industrial Application Support
Program
Max Donation (TL) Support Ratio (%)
Rent Support 18.000 75
Machinery Support(no payback) 150.000 75
Machinery Support(with payback) 200.000 75
Personnel Support 100.000 75

22. KOSGEB
Entrepreneurship Support Program
 Aim;
 To support entrepreneurship, to solve development and
unemployment issues
 To establish successful and sustainable enterprises
 To increase entrepreneurship culture
 To support entrepreneurs with local dynamics
 This program contains 3 subprograms.
 Applied entrepreneurship education
 New entrepreneurship support
 Business Improvement Center (İŞGEM) support

23. KOSGEB
Entrepreneurship Support Program
 Applied Entrepreneurship Education Program
 Contains 60 hours of education
 Education includes general and
specialized(women, adolescents, disadvanted
people) groups
 No fee for educations

24. KOSGEB
Entrepreneurship Support Program
 New Entrepreneurship Program
 This support is for people who successfully completes
applied entrepreneurship program
Type Max Limit (TL) Support Ratio
(%)(1st and
2nd / 3rd and
4th)
Enterprise establishment
support
No Payback 5.000 60 / 70
Machinery and hardware
support
No Payback 10.000 60 / 70
Enterprise expenses
support
No Payback 12.000 60 / 70
Constant investment
support
With Payback 70.000 60 / 70

25. KOSGEB
General Support Program
 Aim,
 To increase project development capacities of SMEs
 To support SMEs to produce with quality and efficiency
 To revise current KOSGEB incentives and make them
available for more SMEs
 To increase competitiveness of SMEs, encourage general
enterprise development activities
 To increase marketing and dissemination aactivities of
SMEs both national and international

26. KOSGEB
General Support Program
Incentives Support Upper Limit
(TL)
Support Ratio (%)
National Fair 30.000 50 / 60
International Business Travel 10.000
Dissemination 15.000
Matching 15.000
Personnel 20.000
Consultancy 15.000
Education 10.000
Energy Efficiency 30.000
Design 15.000
IPR 20.000
Certification 10.000
Test, Analysis, Calibration 20.000

27. KOSGEB - TEKMER
 TEKMERs work as technological
development supporting “Business Incubation
Center”.
 Now, there are 20 TEKMER in universities.
 Main goal is to support new technological
development oriented micro-companies and
support their competitiveness.
 Provides infrastructure support and
workshops.

28. KOSGEB - CIP
 With SMEs as its main target, CIP supports
innovation activities, provides better access to
finance and delivers business support services in
the regions.
 It encourages a better take-up and use of ICT and
helps to develop the information society.
 It also promotes the increased use of renewable
energies and energy efficiency.
 The CIP runs from 2007 to 2013 with an overall
budget of € 3621 million.

29. KOSGEB - CIP
 The CIP is divided into three operational
programmes.
 The Entrepreneurship and Innovation
Programme (2.14 billion €)
 The Information Communication
Technologies Policy Support Programme
(0.73 billion €)
 The Intelligent Energy Europe Programme
(0.73 billion €)

30. TUBITAK
 Organized by TEYDEB.
 From late 2004. Main goal is to rise rate of
R&D expenditures in GNP to 2.0%.
 So, focused on R&D projects.
 Compatible with EU strategic goal.
 Another goals is to rise the portion of private
sector in R&D expenditures to over 50.0%.

31. TUBITAK - TEYDEB
 1501 - Sanayi Ar-Ge Projeleri Destekleme
Programı
 1503 - Proje Pazarları Destekleme Programı
 1507 - KOBİ Ar-Ge Başlangıç DestekProgramı
 1508 - Teknoloji ve Yenilik Odaklı Girişimleri
Destekleme Programı (TEKNOGİRİŞİM)
 1509 - Uluslararası Sanayi Ar-Ge Projeleri
Destekleme Programı

32. Support Procedures
TUBITAK
 Organizations applies for support by filling “Project
Proposal From” (AGY100)
 A council including TUBITAK staff and related
academic staff evaluates project offer.
 After approval, organization should present council
report within every six month periods.
 Council evaluates the report project outputs for
every six month period in order to that check R&D
activities are carried out as in proposal.

33. TEYDEB 1501
 Started with a sign of a protocol between TUBITAK and
Undersecretariat of Foreign Trade in 2005.
 Expenditure shares; 75% TUBITAK, 25% UFT.
 Strategic goals; production of a new product, increase in quality,
reducing costs, development of new production techniques.
 Supports Industry Foundations with donations, and amount of
these donations is up to 60% of total R&D expenditures.
 This support includes all R&D phases from conception
development to production tests and prototypes.
 Support duration is three years.
 No donation limit.

34. TEYDEB 1503
 Brokerage Events.
 Main goals is to increase university – industry
cooperation.
 Meetings with representatives from
universities, research foundations, industry
umbrella foundations.
 Concrete project proposals.
 Donation limit is determined by Science
Council every year.

35. TEYDEB 1507
 Primary target of this programme is SMEs which
didn't apply TEYDEB for support before.
 Strategic goals; production of a new product,
increase in quality, reducing costs, development of
new production techniques.
 Amount of donations is 75% of total R&D
expenditures.
 This support includes all R&D phases from
conception development to production tests and
prototypes.
 Support duration is 18 months.
 Donation limit is 400.000 TLs.

36. TEYDEB 1508
 For entrepreneurs.
 Senior undergraduate students, graduate students,
alumni which has graduated five years ago at most.
 Goal is to support initiatives;
 Supported by technology and innovation oriented
business ideas.
 Have potential for employment and international
competition.
 After acceptance, entrepreneur starts a new
company.

37. TEYDEB 1508
 Amount of donations is 75% of total R&D
expenditures.
 This support includes all R&D phases from
conception development to production tests
and prototypes.
 Support duration is one year.
 Donation limit is 100.000 TLs.

38. TEYDEB 1509
 EUREKA
 CORNET
 TEYDEB is the coordinator of EU Framework
Programme projects.

39. EUREKA
 Established by 19 European countries including
Turkey at 1985.
 Today 38 country and EU is member of EUREKA.
 Goals of EUREKA;
 Support market oriented R&D activities in all high
technology areas.
 Improve competition power of Europe.
 Develop good quality products, methods and services.
 International cooperation of industry and universities.

40. EUREKA
 EUREKA coordinates companies and
research institutes in member countries for
establishing a synergy in order to develop
high technology products, process and
services.
 Application and evaluation processes are
carried out by TEYDEB.
 Generally TUBITAK resources are used for
support

41. CORNET
 Supported within Sixth FW Programme.
 Main goals is to improve knowledge transfer
between national and regional collective
research programmes and create new
collaborations
 Started with 24 institutions from 17 country at
2005.

42. CORNET
 Focused on “Collective Research”
 Not improving competition between SMEs
 Creating a cooperation platform in order to overcome a
common problem.
 Results should be usable for other companies in related
sector.
 SME groups can present proposals.
 Amount of donations is 75% of total R&D
expenditures.
 Support duration is two years.

43. TUBITAK - ARDEB
 1001 – Bilimsel ve Teknoloji Araştırma Projelerini Destekleme
Programı
 1002 – Hızlı Destek Programı
 1007 – Kamu Kurumları Araştırma ve Geliştirme Projelerini
Destekleme Programı
 1008 – Patent Başvurusu Teşvik ve Destekleme Programı
 1010 – Evrensel Araştırmacı (EVRENA) Programı
 1011 – Uluslararası Bilimsel Araştırma Projelerine Katılma
Programı
 1301 – Bilimsel ve Teknolojik İşbirliği Ağları ve Platformları
Kurma Girişimi Projeleri (İŞBAP) Destekleme Programı
 3501 – Ulusal Genç Araştırmacı Kariyer Geliştirme Programı

44. ARDEB 1007
 Main goal is to support projects which may
overcome problems of public institutions with
R&D projects.
 Universities, private foundations or public
R&D units can present their project
proposals.
 Maximum project duration is three years.
 Projects are evaluated by two different
councils; Public and Defense

45. ARDEB 1008
 Main goal is to increase number of national and
international patent requests, to encourage people
about patent requests, to aware people about
intellectual property rights.
 The Republic of Turkey citizens, and companies
which operate in Turkey can apply.
 Supports;
 3.000 TLs donation for national patent request.
 3.000 TLs donation for international/regional patent
request.
 100.000 TLs interest-free credit for international/regional
patent request.

46. ARDEB 1301
 Main goal is to support creation of cooperation
networks and platforms between national and
international institutions, foundations, units and
groups.
 Institutions from industry and business world,
universities, public institutions and foundations and
consortiums between these can apply.
 Support duration is three years.
 Donation limit is 250.000 TLs per year.

47. National Coordination Office
 Kobi Saha Ziyaretleri
 Sanayi Farkındalık Programı
 Türk Sanayisiyle Yürütülen Eşgüdümlü Çalışmalar
 Finansal Konuların Yönetiminde Destek
 AB Çerçeve Programları Proje Önerisi Özendirme
Ödülü Programı
 AB Çerçeve Programları Proje Geliştirme Amaçlı
Seyahat ve Toplantı Desteği Programı

48. EU Framework Programme
 7th Framework Programme (2007-2013); with 52.3
billion € budget.
 83% of budget is reserved for offered projects.
 17% of budget is reserved for administrative expenditures.
 Biggest civil research programme in the world.
 International competitiveness and scientific
perfection oriented.
 Every project should include at least three partners
from different regions.
 Applications are directly to EU Commission.
 Contribution to fund is proportional with GNP.
 But, return amount is proportional with researcher count.

49. EU Framework Programme
 Divided into four main programmes;
 Cooperation (32.3 billion €)
 Ideas (7.4 billion €)
 People (4.7 billion €)
 Capacities (4.2 billion €)

50. EU Framework Programme
Cooperation
 Main goal is to improve cooperation between industry and
research foundations.
 Areas;
 Health
 Food, Agriculture, Biotechnology
 ICT
 Nanotechnology
 Energy
 Environment
 Transportation
 Socio-economic and human sciences
 Space
 Security

51. EU Framework Programme
Procedure

52. TTGV
 R&D Project Supports
 Technology Development Projects Support
 Commercialization Projects Support
 Mutual Technology Development Projects Support
 Technological Entrepreneurship Supports
 Pre-incubation Support
 Risk Sharing Support
 Startup Capital Support

53. TTGV
Technology Development Projects Support
 Main goal is to support “Technological Product” and
“Technological Process Innovation” development.
 Intellectual property belongs to company.
 Support duration is up to two years.
 Support amount is up to one million USD. At most 50% of
project budget.
 After one year, interest-free repayment in four years.
 Up to 3% of project budget is paid to TTGV as “Service
Price”.

54. TTGV
Commercialization Projects Support
 Main goal is to support commercialization
projects of companies which successfully
complete prototype production process.
 Support duration is up to one year.
 Support amount is up to one million USD. At most
50% of project budget.
 After one year, interest-free repayment in four
years.
 Up to 3% of project budget is paid to TTGV as
“Service Price”.

55. TTGV
Mutual Technology Development Projects
Support
 Main goal is to support cooperation of industry and
software companies and improving practical use of
R&D innovations in industry with software solutions.
 Support duration is up to two years.
 Support amount is up to 2.5 million USD. At most 60% of
project budget.
 After one year, interest-free repayment in four years.
 Up to 2% of project budget is paid to TTGV as “Service
Price”.

56. TTGV
Pre-Incubation Support
 Same goal with TUBITAK 1508.
 Support duration is up to two years.
 Support amount is up to 50.000 USD.
 Also offers workshop supports.
 TTGV will demand repayment.
 50% of produced industrial property belongs to
TTGV.
 50% of project profit belong to TTGV.

57. TTGV
Startup Capital Support
 Same goal with TUBITAK 1508.
 Support duration is up to two years.
 Support amount is up to 200000 USD. At most
50% of project budget.
 TTGV will demand repayment.
 50% of produced industrial property belongs to
TTGV.
 50% of project profit belong to TTGV.

58. Ministry of Industry and Trade
 SAN-TEZ
 Main goal is to institutionalize university – industry
cooperation and commercialize scientific studies
carried out in universities.
 Projects including both domestic companies and
universities can be presented.
 Amount of donations is 75% of total R&D
expenditures.

59. Ministry of Industry and Trade
 TGSD
 Generally same with TUBITAK 1508.
 But, TGSD is prepaid and amount of donations is
up to 100% of R&D expenditures.
 Conducted in 2009 and 2010.
 Nearly 100 new ideas are supported each year
 Max donation limit is 100.000 TL.

60. Ministry of Industry and Trade
 Technology Development Areas
 Main goal is to encourage private sector about
university – industry cooperation by providing tax
advantages in determined areas near universities.
 Carried out with Ministry of Finance.
 R&D staff working in “Technology Development
Areas” is exempted from several taxes.
 Also companies deployed on “Technology
Development Areas” has several tax advantages.

61. Ministry of Industry and Trade
 Technoparks
 Is a space, physical or cybernetic, managed by a specialized
professional team that provides value-added services, whose
main aim is to increase thecompetitiveness of its region or
territory of influence by stimulating a culture of quality and
innovation among its associated businesses and knowledge-
based institutions, organizing the transfer of knowledge and
technology from its sources to companies and to the market
place, and by actively fostering the creation of new and
sustainable innovation-based companies through incubation
and spin-off processes. (IASP definition)
 Act 4691
 Services provided by Technoparks can be examined in three
titles;
 Consultancy
 Technical Services
 Social Services

62. Ministry of Finance
 Tax advantages according to Act 5746.
 Exempt from Income Tax.
 Exempt from Corporation Tax.
 Exempt from Stamp Tax.
 Several advantages on Social Security
Contribution.
 Only for R&D staff.

63. Turk Patent Institute
 Hazerfen Project
 Started in 2007.
 Main goal is to provide innovation culture to
SMEs.
 Hazerfen is an pilot application.
 Applied on Ostim OID.
 Free education and consultancy seminars.
 To create awareness about innovation
management and protection of intellectual
property.

64. Other Incentives
 IPARD – EU 7 FP based about animal husbandry in
rural areas
 Regional Development Agencies
 e.g. Mevlana RDA – Increasing capacity with
manufacturing, agro-industry, tourism and services projects
with modern and new approach.
 Total 15.000.000 TL funding
 20.000 TL – 400.000 TL funding for each project
 Max %50 support ratio
 Membership to E-Commerce Sites
 10.000 $ funding
 3 years

65. References
 Wikipedia
 http://en.wikipedia.org/wiki/Entrepreneurship
 http://en.wikipedia.org/wiki/Angel_Investors
 http://en.wikipedia.org/wiki/Venture_capital
 GEM - http://www.gemconsortium.org/
 KOSGEB Official Web Site
 TUBİTAK Official Web Site
 TTGV Official Web Site
 Ministry of Industry and Trade Official Web Site
 Ministry of Finance Official Web Site
 Hazerfen Project Official Web Site