4 th ESTER Meeting Tel-Aviv 12 -14 January

4 th ESTER Meeting Tel-Aviv, 12 -14 January 2005 Astrid Severin Innovation Policy Unit

Overview • Business Angel Networks in Europe • PAXIS transfer of experience • Gate 2 GRowth Investor. Net • ERDF funding scheme in Ireland • Future set-up

The equity gap

Business Angel Networks (BANs) • Business Angels - private individuals investing part of their personal assets in a start-up and sharing personal business management experience with the entrepreneur • The concept first developed in the US-in Silicon Valley, California • European networks first appeared in the UK, the Netherlands, Finland, Belgium, Germany, France and Italy • Australia is also home to intense informal venture capital activity (www. businessangels. com. au)

BAN set-up • Business Angel Networks (BAN) - organisations aiming to facilitate the matching of entrepreneurs with business angels (neutral, no evaluation of business plans or angels) • Most EU BANs legally set-up as private firms, non-profit organisations or possibly foundations in collaboration with banks, incubators, Chambers of Commerce or Regional Development Agencies • ERDF eligible regions have possibility of leveraging EU funds to co-finance BANs (LINC Scotland has been receiving ERDF subsidies from this channel)

Evolution of BANS 1999 -2004

Evolution of BANs • No of BANs has strongly evolved • In 2003, EBAN identified 196 networks and by mid-2004, 282 European networks – Germany from 1 to 40, Spain from 0 to 11, UK from 49 to 101 – Israel from 0 to 2 – Czech Republic 2, Hungary 1, Poland 1, Malta 1, Slovenia 1, Russia 4…

PAXIS Business Angel Networks • HIGHEST - Networking between incubators and Business Angels • KREO - Creation of BANs in Karlsruhe and Lyon (2001 -2002) • PANEL - Munich Business Angels • SPRING - Creation of Business Angel Forum Region Stuttgart e. V. and initiation of a Business Angel Network Madrid • START - Business Angel Network Management (Veneto)

UK - The environment – 1998 The University Challenge Fund (£ 60. 0 m for new projects and seed capital for new spinouts) – 2000 Higher Education Reach Out (£ 83. 0 m over three years to encourage academic spin-outs) – 2001 Public Sector Research Exploitation (£ 25. 0 m to fund commercialisation of new technologies) – 2002 Higher Education Innovation Fund (£ 77 m over three years to encourage academic spinouts)

The Oxfordshire Investment Opportunity Network (OION) • Established in 1994 as part of Oxford Innovation • Linking early stage, high growth potential companies with investors • Technology- and Oxford-based, monthly mtgs • 120 + Active Investors: Individuals (syndicates), VCTs (Seed Capital), VCs (3 i, MTI), Corporate investors (GSK, Unilever)

Transferring best practices – OION model presented and discussed during SPRING / KREO workshop on early stage financing – Business Angel Forum Region Stuttgart established – Both models basis for BAN Madrid area (project started in July 2004) – Cambridge BAN tools presented and transferred to in Stuttgart (2004)

PAXIS – Transfer of excellence • Transfer examples – Concept for creation of Business Angel Networks – Co-incubation of start-ups in biotechnology incubators – Euro-Office initiative supporting the internationalisation of SMEs – Combination and transfer of successful technology platform models (biotechnology, genomics, diagnostics)

Gate 2 Growth • Networks and services for entrepreneurs (Business Matching), investors (Investor. Net), technology incubator managers (Incubator. Forum), industrial liaison and IPR managers (Pro. Ton Europe) and academia (Academic Network) • www. gate 2 growth. com

Investor. Net • Enhancing the capacity of European early -stage venture capital operators to invest in innovative companies – Acceleration of EU cross-border contact and communication – Provision of central points for accumulation of knowledge – Cross-border networks of support organisations and ‘project generators’ (universities, science parks, incubators)

Investor. Net • Lessons learnt – Round table meetings enable personal contact within specific sectors but across borders – Investors are still find hard to find high quality investment opportunities – Investors main concern is exit possibility – Very difficult to identify potential investor members from new members states as technology focussed VC industry is underdeveloped

Investor. Net Round Table Meetings 2005 • • ICT and Design March 2005 London Medical Devices April 14 th-15 th 2005 Berlin Energy Technology June 2005 Scotland Nutrition and Food technology July 2005 Italy/Belgium • Biotechnology September, 2005 Copenhagen • E-Content, E-Commerce and Media October, 2005 tbd

Financing and the ERDF • The Irish Research Technology and Innovation (RTI) Competitive Grants Scheme • National Development Plan 2000 -2006 (Operational Programme for the Productive Sector) • Scheme supports commercially focussed, industry-led projects in product and process development • Co-funded by the ERDF; Managed by Enterprise Ireland

Objective of RTI in Ireland • Helping companies to reach and exceed European and international norms for R&D investment • Increase – – No of companies performing effective R&D No of companies doing R&D for the first time Investment in R&D in Ireland Quality and quantity of the R&D linkages between companies and third level institutions and companies

Using the RTI Grant • Process and product development projects for companies with expenditure up to 95, 200 Euro • Expenditure exclusive and essential to project (salaries, overheads, material for prototype tooling, travel, external consultancy incl. design) - 2 years

Assessment of applications • Technical feasibility and innovative quality • Accuracy of project planning and costing • Technical capacity and track record of company in R&D • Capacity to commercialise output of RTI results • Increase R&D capacity as result of project • Formal collaboration taking place (with other comapneis, R&D institutions, etc) More information: www. enterpriseireland. com/rti

Future set-up Gate 2 Growth Networking Innovation actors 1. 2. 1. 4 PAXIS Coordination Collection Analysis Exploitation of results 2 Mio Euro EUROPEAN INNOVATION PORTAL Innovation &clusters 1. 2. 1. 3

For more information • www. cordis. lu/paxis • www. gate 2 growth. com • www. eban. org • www. enterprise-ireland. com/rti alex. talacchi@cec. eu. int astrid. severin@cec. eu. int