This document discusses sustainable financing options for cluster initiatives. It begins by outlining the typical financing structure in Europe, which includes baseline public support, membership fees, and EU project funding. It then examines a case study of an aviation cluster that lost public funding and had to transition to new sources. These included increasing membership fees, providing new fee-based services, and partnering with other organizations. The document also analyzes factors that influence financing like acquiring new members and clients, modifying fees, and developing various fee and non-fee services. Overall it promotes moving from sole public funding toward more diverse and sustainable sources like strategic projects and international initiatives driven by member demand.

1. Sustainable Financing
of Cluster Initiatives
Gerd Meier zu Köcker
Bernhard Grieb
ClusterAgentur BW
September 22, 2017

2. Financing of Cluster Initiatives
in Europe
01.10.2017© ClusterAgentur BW| 2
Source: ESCA data, April 2017

3. Baseline Support
• Mainly public co-
financing on regional
or national level
Membership-based
Financing
• Membership-fees
• Fee-based Services
EU-Projects
• COSME
• H2020
• INTERREG
• etc.
Financing Approach of Cluster
Initiatives
Usual Financing Structure of Cluster
Initiatives in Europe Today

4. Real Case
Sustainable Financing
Aviation Cluster BodenseeAIRea
 30 Members (25 companies, 5 academic partners)
 1,5 FTE
 2012-2014 Funded by ERDF (50 % funding)
 EFRE funding terminated in 2015
01.10.2017© ClusterAgentur BW| 4

5. Real Case
Sustainable Financing
Actions implemented by cluster
management
 Increase of membership fees
 Cost savings (outsourcing / insourcing)
 Attracting of new strategic partners through new services
(Regional Development Agency / Chamber)
01.10.2017© ClusterAgentur BW| 5

6. Change of Funding Sources
01.10.2017© ClusterAgentur BW| 6
50%
75%
50%
25%
2012-2014 ab 2015
Mitgliedsbeiträge EFRE WiFö/IHKMembers RDA / Chamber
Real Case
Sustainable Financing

7. Determinants of Financing
Cluster Initiatives
01.10.2017© ClusterAgentur BW| 7
Financial options
• Akquisition of
new
members
• Introduction
of new fee-
bases services
• Free services
to be turned
into fee-
based
services
• Increase or
modify
membership
fees
• Identification
of new clients
• Regional
• National
• European
Members Services
Membership
Fees
Clients
Funding
Programmes

8. Determinants of Financing Cluster
Initiatives
01.10.2017© ClusterAgentur BW| 8
Financial options
• Akquisition of
new
members
• Introduction
of new fee-
bases services
• Free services
to be turned
into fee-
based
services
• Increase or
modify
membership
fees
• Identification
of new clients
• Regional
• National
• European
Members Services
Membership
Fees
Clients
Funding
Programmes

9. New Members
 Advantages
– Increase critical mass
– Close gaps in value chain
– Gain „High Quality“ members
 Disadvantage
– More members, more demand
– High ratio members / FTE can lower Quality of
performance
01.10.2017© ClusterAgentur BW| 9

10. Determinants of Financing Cluster
Initiatives
01.10.2017© ClusterAgentur BW| 10
Financial options
• Akquisition of
new
members
• Introduction
of new fee-
bases services
• Free services
to be turned
into fee-
based
services
• Increase or
modify
membership
fees
• Identification
of new clients
• Regional
• National
• European
New Members Services
Membership
Fees
New Clients
New Funding
Programmes

11. Cluster Services
How they contribute to profit generation and
committments
01.10.2017© ClusterAgentur BW| 11
Services
Applied by
CM €- €0 €+   
Organisation of trade fair missions often X X X
Company Visits (by Members) usual
Face-to-face visits (CM visits individual
members)
often X X
VIP-Event Rare X X X
Seminar/Training usual X X
PR / Promotion of cluster usual X X X X
PR / Promotion for members rare X X
Connecting members usual X X
Project management rarel X X X
Publication usual X X
Studies intended for members rarely X X
Appreciated by
members
Financial
Contribution

12. 01.10.2017© ClusterAgentur BW| 12
Services
Applied by
CM €- €0 €+   
Networking usual x x x
Consultancy rare x x x
Matching suppliers with key buyers rare x x
PR Material usual x x
Competence Atlas / Mapping often x x x
Seminars / Training often x x
Organisation of trade fair missions often x x xxx xxx x
Cluster Services
How they contribute to profit generation and
committments
Appreciated by
members
Financial
Contribution

13. Services: Public Relation for SME
Example: HighTechComm
Cluster Nanotechnolgie
und Munich Biotech
 Cluster Managements support SME in PR
and communication manners. This includes
- Analyses (What exists? What is needed?)
- Communication / Marketing Strategy
development
- Dedicated PR activities / Website
development /maintenance

14. Services: Matching Supplier -
Buyers
Example: Samsung
Innovation Days
Silicon Saxony
 During Samsung Innovation Days members
of the Silicon Saxony Clusters get direct
access to Samsung Management and
buying agents.
 Members are selected and trained for face-
to-face meetings
 High success rate

15. What Members are Ready to
Pay for
01.10.2017 15
Source: Silicon Saxony, 2015/2016
Legal advice, certifications
Market and trend studies
Support in product development in new
areasSupport in access to public funding
IPR / Trademark issues
Support in product design development
Feasibility studies
Business plan development for start-ups
Support in product development in new
areas
General support for start-ups
Brainstorming / Open Innovation etc
Demand
Readiness to pay
Low High

16. Baseline Support
• Mainly public co-
financing on regional
or national level
• Value for Money
Membership-based
Financing
• Membership-fees
• Fee-based Services
Strategic Projects
• Public investments
instead of public
funding
• New services (of
strategic relevance )
• Complex cross-
sectoral initiatives
• Projects for regional
development
• Strategic projects
• International
projects (members’
demand driven)
Sustainable Financing of Cluster
Initiatives
Toward Sustainable Financing of
Cluster Initiatives

17. 17
ClusterAgentur Baden-Württemberg
Willi-Bleicher-Straße 19
70174 Stuttgart
01.10.2017© ClusterAgentur Baden-Württemberg
Dr. Gerd Meier zu Köcker
Director General
mzk@clusteragentur-bw.de