Innovation ecosystems in Europe: how boosting promising startups and SMEs

How Boosting Promising Startups and SMEs
Open Innovation Accelerator – Case Study
Difficulties Met in Russia
Филипп Жеффруа, Юлия Никулина
2015 г.

About Philippe GEFFROY
PhD In Technology Assessment / MSc in Innovation Management/ MSc in Industrial process and Manufacturing Engineering
Experienced in Technology assessment, Scouting , Business Innovation development and Innovation Policies since 1998
In Russia
 Work with Russian clusters about internal organization (CMO), international promotion and development. References: Troitsk
(photonics), Ulyanovsk (aeronautic), Novosibirsk (IT and biotechs), Тоmsk (IT), Krasnoyarsk (Space), Khanty-Mansiysk (APG) and
others.
 Provide diagnostic and hands-on support to technoparks staff organization and specialized coaching for promising startups in the
framework of the World Bank program to support Russian innovation system and Russian Venture Acceleration Network.
 Business Development support to foreign companies (Aerospace, advanced composite material, Automotive, Railways, biotechs,
etc)
 Outsourcing of research programs and technical due diligence for industrials and M&A Consulting firms
In Europe
 Work with main French, Belgium, British clusters and other on collaborative projects and business development,
 Research outsourcing, Technology due diligence for large companies and commercialization from science results in EU countries
and North Africa,
 Provide Startups hands-on support to reduce time to market, (pre-industrialization stage)
 Co-founder of an Open Innovation Accelerator (On Going)
PHG 2November 20 2015

OPEN INNOVATION MODEL
How it works ?
GEFFROY@LINKWEST.EU 3December 01 2015 ASI Moscow

Open Innovation Model
Process (Example : NutrurEnergy Consulting Firm)

November 11 2013
Open Innovation Potential Benefits, costs and barriers

Exemple BizLab AIRBUS

Some Useful Ingredients
 On the one hand ; the demand (Pull)
– SMES that want to overtake their R&D weaknesses
– Large enterprises with interests in disruptive technologies
– SMEs without R&D department
– Large enterprises with high-level of Marketing Staff
– …
 On the other hand ; the offer (Push)
– Startups that want to faster go to market
– Scientifics who want selling/licensing sciences results
– Large enterprises that want selling/licensing their proprietary
technologies
– Startups that want to fine tune their idea/proof of concept
– ….

WHICH PLACE FOR INTERMEDIARIES IN THIS NEW
APPROACH ?

Open Innovation Accelerator
New Challenges for Intermediaries
Two-sided innovation intermediary platforms
 The best innovation intermediaries are structured as an emerging form of broker that coordinates
the flow of innovation requests and solutions across distinct, distant and previously unknown
knowledge sources as well as provide managerial advise to internalize external sources of
knowledge.
 In conclusion, theoretically for the most advanced, innovation intermediaries are a powerful force for
putting innovation needs and solutions within the reach of every company and entrepreneurial
scientist.
 However, companies must ensure their collaboration with innovation intermediaries with an overall
innovation strategy. Companies’ internal organizations should make use of services and the growing
variety of intermediaries offering them.
 The companies that will profit from open innovation are those that adapt their innovation processes
and organizational structure in line with the new opportunities offered by innovation intermediaries.

New Challenges for Intermediaries - Example of private Incubator
 Siemens Technology- to-Business Centre (TTB) is a private incubator that provides
connectivity between entrepreneurs developing disruptive technologies in areas such as
clean energy.
 The benefits of this incubator for Siemens are:
– First it allows Siemens researchers in different business units to have a first- hand
licensing and insight of potential technologies and identify potential suppliers.
– Second, it facilitates investments in spin-in technologies that currently do not have an
established market but have the potential to have it in the near future.
 Up to now, this initiative has produced around 15 spin-in Siemens technologies.
 On the other hand, entrepreneurs receive: free allocation and support from internal project
development managers, links and advice from business and research units.

Kindly Reminder

OPEN INNOVATION ACCELERATOR INGREDIENTS FOR
A SUCCESSFUL SET-UP
- BEST PRACTICES-

CORE BUSINESS SECTORS, SEAD CONCEPT, LEAN STARTUP
MODEL, PRIVATE OPEN INNOVATION ACCELERATOR,
WORLDWIDE NETWORK

DEVELOP
 Corporate R&D
Network
 Portfolio Push
The Legitimacy
 Proven experience in Scouting and Technology Transfer consulting - Staff must combine many
years experience in open innovation engineering (scouting, brokering, TT, coaching), and
generating outstanding ROI for clients.
 Proven experience - Industry leaders such as Aerospace, Medical devices, Automotive,
Railways, and many others
 Proven technical expertise - Staff must have direct technical expertise e.g. material science,
photonics, nanotechnology, biotechnology, IT, etc.
 Proven network - Managed network of R&D Directors and Marketing Directors + extended
academia worldwide network
 Proven Process :
SCREEN
 PROs, BSIs Network
EVALUATE
 Project maturity
 Promoter Profile
 Proximity to Market
ACCELERATE
Faster solution
brought to
Market

The Comfort Zone

Core Competencies Nucleus : Example on some KETs

Well Known the key Markets (Overall Trends, Niche,)
 Transports (aerospace, automotive, railway)
 Energy (renewable, energy saving, etc.)
 Life and Health Sciences ( Medical devices, Medical Diagnosis, Personalized
medicine, ..)
 Security (optronic and signal treatment, photonics technologies)

Internal Process
Case 1 Scouting ; From the Client Needs (Pull approach).
Unique Selling Proposition.

Internal Process
The BDP Case 1 Scouting ; From the Client Needs (Pull approach).
INNOVATION
SCOUTING
 Public and private research, inventors, IP portfolio
 Initial selection (100->50) : pool of opportunities
 First evaluation of opportunity: area of application /markets,
target/economic, potential/regional or national/international priority
OPPORTUNITY
SELECTION
 Technological maturity : TRL Scale (Technology Readiness Level)
 Cost to market vs Time to market
 2nd selection (=50>5) for “project” step : more in depth evaluation
PROJECT
DEVELOPMENT
 Product development roadmap, market study, IP assessment
 Technology Trasnfer
 Business Model
 Funding strategy
BUSINESS
LAUNCH
 Partners & shareholders selection
 Team build-up
 Operation start
A 18 to 36 + Months Process
OIA Exit

Internal Process
The BDP Case 2 ; Open Innovation Model + Lean Startup
INNOVATION
SOURCING
 Public and private research, inventors, IP portfolio
 Initial selection (10) : pool of opportunities
 First evaluation of opportunity: area of application /markets,
target/economic, potential/regional or national/international priority
OPPORTUNITY
SELECTION
 Technological maturity : TRL Scale (Technology Readiness Level)
 2nd selection (8 TRL 5-6) for “project” step : more in depth evaluation
PROJECT
DEVELOPMENT
 Product development roadmap, market study, IP pending
 Business Model
 Funding strategy
BUSINESS
LAUNCH
 Startup creation
 Partners & shareholders selection
 Team build-up
 Operation start
OIA Exit
Target !!! a 18 Months Process to go market

Internal Process
The BDP Case 2 ; Lean Startup in a Nutshell
“The Lean Startup method teaches you how to drive a startup-how to steer, when
to turn, and when to persevere-and grow a business with maximum acceleration”
 Eliminate Uncertainty : Create order not chaos by providing tools to test a vision continuously
(PDCA)
 Work Smarter not Harder : Enlisting early adopters, adding employees to each further experiment
or iteration, and eventually starting to build a product.
 Develop a Minimum Viable Product (MVP) : The first step is figuring out the problem that needs
to be solved and then developing an MVP to begin the process of learning as quickly as possible (5W).
 Validate learning by production of high quality goods. When you focus on figuring the right
thing to build-the thing customers want and will pay for-you need not spend months waiting for a
product beta launch
An other and more realistic definition of startup could be : "a human institution designed to
create a new product or service under conditions of extreme uncertainty"

Internal Process
Competencies and Contributors summarized
INNOVATION
SOURCING
 Gold-digger
 Researcher, inventor
 Domain experts
 IP specialist
OPPORTUNITY
SELECTION
 Technology expert
 Labs for testing
 Market study expert
PROJECT
DEVELOPMENT
 Project manager / Business developer
 Pré-Industrial/Manufacturing expert
 Industrial / Manufacturing Expert
 Financial expert : funding, business plan
BUSINESS
LAUNCH  HR specialist for team build-up
 Go-to-market specialist

Key Point 1
Sourcing ; The Network
 Professional / business networking is about (e.g. TTOs, BSIs such as cluster,
technopark association, alumni in the companies, …):
 Focused on professional/business issues
 Structured around individuals representing their (private or public)
organization rather than themselves
 Oriented towards specific professional domains , with activities favoring
research, technical or business collaborations
 Services provides hands on support to SMEs and Start ups
 Community platform ) : researchers, corporations, partners, private equity
funds, entrepreneurs,…

Key Point 2
Skills in Technology Assessment
GEFFROY@LINKWEST.EU 24
December 01 2015 ASI Moscow
OPPORTUNITY
SELECTION  Technological maturity : TRL Scale (Technology Readiness Level)
The Innovation
Phase

Key Point 2
Skills in Technical Due Diligence
Objectives : Is there ;
- Any competitor(s) ? Many ?
- Many competitors but I have a competitive advantage ?
- No competitors ? I have a Doubt !!!
- Competitors but there is a niche.

Key Point 2
Example of Competitive Advantages on a radar figure

Key Point 3
Evaluate; Market research and Market Analysis
 Planning to enter a business venture without performing Market Research and Market Analysis,
is like going to an unknown destination without a map: hazardous !
 Many difficult decisions are to be made along the « bring innovation to market » road: market
research first, then market analysis will narrow the number of alternatives, like targeting
segments with too small potential, or projecting to offer a product that will be in low demand
 The assessment of the overall potential of a innovation is very much determined by the correct
interpretation of market data (but of course not only) : false reasoning, or a wrong or
incomplete quantitative model,…can lead to totally non-desirable decisions or choices.
 Finally, as the « owner » of a project has commonly a tendancy to over-estimate market potential
(and be very persuasive about it!), it is a key input in the overall assessment of a startup, that
will balance excessive optimism
Both there are recurring processes in order to achieve accurate quantitative and qualitative knowledge of the business

Key Point 4
Evaluate Promoter’s Profile and Staff if necessary at early stage (coach)
 The type of support start-up businesses require may vary by the sector, the sophistication
of the entrepreneur (cultural back ground, what he really wants to do or not.), the back
ground of the region (is there a culture of enterprise or has employment traditionally been
based on working for the regions large companies?) and the economic climate.
 The aim of any organisation created to support business start-ups is not only to guide the
entrepreneur through the process of starting a business but also to help the individual to
make an objective view as to the viability of the idea and the business model.
 A particular attention must be paid with projects originatingfromresearch.
 It is important to have a business-orientedteamto take over and leadthe gamefromthe start:
coaches, mentors or advisors can be most effective if the startup and its team are fully dedicated to
the business.

Key Point 6
A method for Acceleration
Objectives are
Technical risk mitigation and reduce time to market
Method
Roadmap with BRL level scale Radar
Model of Pitch

Key Point 6
A method for Acceleration / Focus on the Radar
Our Objectives
Technical risk mitigation and reduce time to market
Method BRL
Roadmap with BRL level scale Radar
Model of Pitch

CASE STUDY
Sourcing Estimation Acceleration (SEA) Program in
Tunisia on Behalf of the EU Commission. March –
September 2015

Overall process
Results obtained

Among the Results
Startup Bionic+
5

LESSONS LEARNED IN RUSSIA
From innovation policy dreams to the harsh reality
of economy

In Short
Over the past twenty years+ all ingredients of an efficient innovation system were
established
BUT
In 2014 it is not possible to state that the effectiveness of public spending is
satisfactory
The World Bank August 2014 Moscow Conference

 Incredible academic talents
 Long lasting scientific policy
 International relationships in key sectors
 Money (complex to access, but existing)
 Hard infrastructure all over the country with visible “hot spots”
such as Saint-Petersburg
 Continuous push on the innovation policy
A Large Variety of Well-Know Assets

 A number of private initiatives emerge
 Large firms start considering Russian innovations
 Impact of foreign investors
 Globalisation of more and more technology-based firms
 Sectors such as internet and mobile applications
New Emerging Assets

Emerging Opportunities
Gate Keepers
Nuggets of gold with surprising opportunities
An abundance of low prospect startups, many
supported by governments and donors

Gate Keepers in Russia
Some public programs have
insight on their global
competitiveness
Some private programs
already have a track record
RVC
Skolkovo Foundation
Launch Gurus
For 3 years the GVAccelerator proved its effectiveness by launching
186 startups with a success rate over 35%.
The graduates of the GVAccelerator attracted more than $ 25 million
of venture and private investments, created more than 710 jobs and
reached capitalization of over $130 million.

HOWEVER !

2012 Revenues

Researchers
 Deceiving mobilization of the scientific communities with failure of commercialization of
science (compared to potential)
 Difficulties in "forcing" scientists to respond properly and in time to business needs.
Policy
 Political choices rarely focused on “real business demands” + an over-concentration on foreign
practices
 A governmental policy focused on the RoI and not on economic impact (outputs versus
outcomes)
 No, or limited budgets allowing to prepare technologies to a level that is understandable and
attractive to firms (very often, technology offers are still at a TRL 3 or 4).
Key Findings - 1

Intermediaries
 Lack of understanding of how to assess the market value of technologies.
 Difficulties assessing the work that needs to be carried out before a technology is presented to
potential customers.
 Problems in recruiting technology commercialization staff who have enough commercial skills
and the proper networks in firms.
 Lack of skills in carrying out techno-market intelligence (what are the real needs of firms).
 Absence of understanding on how to address the innovation supply chains.
 Lack of administrative flexibility/agility to meet demands from firms.
 No, or limited capacities to assess needs of international players (lack of networks and lack of
competencies).
Key Finding - 2

 Heavily investing in Human Capital for innovation, commercialization of science
and entrepreneurship
 Helping Regions understanding and creating “Innovative Administrations”
 Stimulating the demand side versus the supply side
 Fine tune the balance between best practices and Russian creativity, in other
words ; work harder and invent a model adapted to Russia
The “soft side” of innovation

СПАСИБО ЗА ВНИМАНИЕ!!!
Контакты:
Юлия Никулина,
nikulina@linkwest.eu
+7 905 506 2211

Innovation ecosystems in Europe: how boosting promising startups and SMEs

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