These are useful benchmarks when looking at patient information systems. Capability Maturity Model The Capability Maturity Model (CMM)( 4) was defined originally for software development by Carnegie mellon University
The GOE's first objective was to undertake a global survey on ehealth to determine a series of benchmarks at national,
The aim was to provide governments with data that could be used as benchmarks for their own development as well as a way to compare their own progress with that of other Member States.
Access to Finance for SMES The Commission wants to make venture capital funds accessible to SMES providing them with more expertise
which provide venture capital for SME financing. The facility covers investment into venture capital funds which have an early stage focus (GIF1)
and funds with a focus on SMES with high growth potential in their expansion stage (GIF2).
This can be done via the means of loans/guarantees, equity, venture capital, Business Angel Matching funds and investments in Technology Transfer Funds under the umbrella of a Holding Fund.
The report aims to provide an objective international performance evaluation based on quantitative indicators and benchmarks,
. The ICT Development Index (IDI) 2. 1 Introduction to the IDI1 The ICT Development Index (IDI) is a composite index combining 11 indicators into one benchmark measure that serves to monitor
either side of an important benchmark, as only the CIS and The americas regional averages exceed the world average of 4. 77,
In response to the demand for global benchmarks on ICT prices, ITU has been collecting ICT price data following a harmonized methodology since 2008.
In seven African countries (20 per cent of those included in the price benchmark), fixed-broadband plans cost more than 100 per cent of GNI p. c. Chart 4. 10.
Half of the African countries included in the price benchmark have a GNI p. c. below USD 1 000,
For example, entry-level fixed-broadband prices cost less than USD 20 in 65 countries worldwide (39 per cent of the total included in the price benchmark),
of the African countries included in the price benchmark, mobile-broadband prices were more than USD 10 cheaper per month than fixed-broadband prices.
The Regulatory Tracker is an aggregate benchmark of each country's legal and regulatory frameworks using as a reference internationally recognized regulatory best practices.
and benchmark countries'ICT developments, monitor the evolution of the information society and identify digital divides.
It created a vice president of digital ventures, hiring Adam Brotman to fill the post. His first move was to offer free Wi-fi in Starbucks stores,
The promotion of venture capital investments will bring along more successful products and companies from the ideas;
credit, leasing and venture capital programmes, as well as the introduction of guarantee products. Investment in the future National research and development and innovation strategy 2013-2020 The National S3 Strategy defines the territorial-technological-sectoral projection of the"Investment in the future, National Research & development and Innovation Strategy 2013-2020"(hereinafter,
and enable the companies engaged in research and development to obtain, among other things, seed or venture capital investments.
, by means of the accessible services of business incubators funded by the state in a structure compliant with the market, supported venture capital constructions and guarantee funds,
the ratio of business and public R&d spending improves. 32 Most of the domestic venture capital investments between 2010 and 2013 were given by the start-ups
or the so-called later-stage venture capital transactions Seed capital investments represented a negligible share, which can be problematic in the long run in terms of the sustainability of the development of the private
and venture capital markets. 82 The pilot projects above will have an impact on the problems of the domestic RDI system
and grow their venture. The global study Good Incubation (2014) 12 explores how social venture incubation has grown as a set of techniques to help founders develop ventures that are investable propositions,
including a focus on incubators with a specific focus on supporting digital social innovators. Incubators typically support innovators in exchange for equity, at pre-seed or seed stage.
The work by Nesta in the UK, on the tech for good incubator Bethnal Green Ventures,
Bethnal Green Ventures in the UK, who support early-stage technology start-ups tackling a social or environmental problem with £15,
Wayra Unltd The Accelerator Healthbox London Clearlyso Angels Bethnal Green Ventures Tor Open Garden Guifi. net Confine Smart Santander DSI AREAS
AND EMPLOYMENT Arduino Avaaz Avoin Ministeriö Bethnal Green Ventures Citysdk Clearlyso Angels Communia Commons 4 Europe Confine Crisisnet Desis Network Everyaware Fablab
Right Group Open Knowledge Foundation Github Free software foundation Wayra Unltd Bethnal Green Ventures Tor Guifi. net
adapted from Sestini, F (Digital) Innovation Venture capital Big data and cloud computing COMPETITION, ECONOMIC ENTERESTS Innovation and innovation policy are not new to the European union.
Results from 2012, shows that more than 400 ventures were started among its members. One of the most obvious measures is to crackdown on tax abuses by technology companies.
Seed funding is aimed mainly at start-ups and ventures. There are other elements such as prizes, competitions, events,
For instance, the Nesta report Good incubation 72 charts the rise of social venture incubation, with a focus on
and their projects The Triple Helix outlines how social tech ventures, and investors, should focus on three types of value Social Value, User Value and Financial Value when developing and scaling their project (s) 76
The potential social change the venture intends to create i e positive impact health, resilience and sustainability society.
There has to be a market for the venture to be sustainable and the venture has to be active in it.
The generation of sustainable income is understood as financial value, which comes as the result of realising user or social value.
and the DSI accelerator programme run by Bethnal Green Ventures have demonstrated potential in how models developed to support early-stage businesses can be adapted to support
and service delivery performance is compared regularly with target performance and good practice benchmarks. The dependency of the legacy system on service performance is known,
in particular through venture capital. Venture capital markets are, however, not sufficiently developed in Europe as they encounter significant difficulties in raising capital abroad
and in operating across borders because of a multiplicity of national regulatory regimes and tax barriers.
On 7 december 2011, the Commission adopted an action plan on access to finance for SMES. 191 The action plan includes measures to facilitate the cross-border provision of venture capital services in view of the existing multitude of national regulatory regimes
or enable them to benchmark the products they intend to buy against the best in class on the market.
Another important factor was the growing availability of private venture capital, which has helped to finance new firms
Invesdor, Venture Bonsai and Vauraus Suomi are active mostly on Finnish equity-based crowdfunding markets.
n Jäsenlehti 2013: 10 3. 11) Collins L, Pierrakis Y, The Venture Crowd. Crowdfunding Equity Investment into Business, 2012.12) Surowiecki J.,The wisdom of crowds:
In addition there are stronger opportunities to experiment with potentially risky technologies outside the company's boundaries using venture capital support and finances.
growth of venture capital markets This trend makes it possible for promising ideas and technologies to be developed further outside universities
which act as venture capital to spur innovation, entrepreneurship and economic growth. According to the Thomson One database there were 26 university funds established between 1973 and 2010 24.
(23) Croce A.,Grilli L.,Murtinu S.,Venture capital Enters Academia: An Analysis of University-Managed Funds, Journal of Technology Transfer, 2013.24) Thomson One database.
I shall take the Harvard Office of Technological Development (OTD) as a benchmark. OTD is an organisation specialising in technology transfer,
Usually venture capital providers or large companies that are clearly profit and yield-orientated businesses manage investor-driven labs S2.
Found Fair Ventures Found Fair Ventures is an incubator and company builder founded by the investor Burckhardt Bonello in 2010 in Berlin-Mitte.
Found Fair Ventures supports start-ups and start-up teams through different channels: Start-ups and teams with a product or prototype can submit their business plan (concept,
Finally, venture partners are established companies that are either part of the expert network or function as partners for one of the internal start-ups.
Start-ups additionally receive consultancy from Found Fair Venture's mentors. Conclusion Despite their great variety, all lab types discussed in this article share five key characteristics 24.
-With an investment from Google Ventures and the world's famous venture capitalist Kleiner Perkins, the valuation of the company amounts to USD 1. 12 billion.
including new ventures, products, services and processes. Turkama and Schaffers elaborate in their article on the evolution of large-scale public-private research and innovation initiatives;
since they can share resources without mobilising so much 23 venture capital; and share access to a broader base of ideas, especially for large companies.
financial support institutions for new technology-based firms (public and private venture capital firms, angel networks, seed capital funds, etc..
the provision of public venture capital a traditional task for the industrial sphere. Similarly, universities, in addition to their teaching
and even funding to encourage entrepreneurial ventures, thus enacting some of the traditional role of industry.
These were designed to catalyse innovation to become a value driver value defined as a new generation of entrepreneurial Europeans, new ventures, new products,
Barriers to US venture investment in UK Internet and digital businesses, Nesta Report, June 2013 Some of the questions raised in the debate were as follows:
These strive, in the long term, to create trust from venture capital and other investors (6). In 2009, only one year after its setup,
EIT ICT Labs Entrepreneurial Talent and Venture Development Model Business Ideation Talent Identication STRATEGIC COACHING ACCESS TO FINANCE TECH TRANSFER Innovation Radar INNOVATION RADAR
KIC Innoenergy houses the ventures for a limited period of time during which it provides coaching and helps with marketing and business development.
industrial, venture capital and other networks. They are driven business towards financial self-sustainability so that when in the longterm, the EIT funding stops,
They created business ventures but also democratic civil society institutions. This entrepreneurial talent should be integrated within the most advanced KICS to bring fresh blood, a different sort of thinking and a‘hungry'immigrant mentality that remains the critical driver of Silicon valley's success (13.
Barriers to US venture investment in UK Internet and digital businesses, Nesta Report, June 2013.8) EIT Call for KICS (2009).(9) Taleb, N.,(2010), The Black swan:
such as industrial demand and venture capital, and to open up the ecosystem for developer communities based on free access to developed technologies and know-how.
albeit intangible, can provide valuable insights for searching a national benchmark as well as for future risk control.
but also left legacies for people to remember and for other countries to benchmark. Although the two innovative governments successfully implemented their respective stimulus measures
) The Experimental Nature of New Venture Creation: Capitalising on Open Innovation 2. 0, Innovation, Technology, and Knowledge management. Berlin:
Grantees who successfully graduate from the programme with a marketable application will receive support for access to finance (accelerator, business angel and venture capital investment) and access to international markets.
To facilitate and accelerate the development of the early-stage pre-seed ventures, by enabling young Europeans to technically skill-up and validate their innovative idea,
(and customers) before the venture even goes to market (and in some cases, before the product even goes into production!),
SMES that are engaged successfully in venture activities, external participation or effective in licensing intellectual property tend to be the exception (van de Vrande et al.,
Collaborations with the Open source Community and Innovation Performance of Software Entrepreneurial Ventures, Journal of Small Business Management, 50 (2), pp. 340-364.61.
These stories about applying open innovation in small firms successfully can barely be compared with the open innovation ventures of large manufacturing companies, such as Xerox, P&g, Philips, Lego, and IBM.
we focus on how fostering a good relationship between the new venture and the company that developed the technology is instrumental in producing a commercially successful venture.
The second example illustrates the opposite case: A small engineering company licensed its technology to a large company to develop a new product for the large company.
therefore also not surprising that it took Toine Janssen only a week before he decided to pursue the venture.
Many venture capital-backed high-tech ventures have been established to explore business opportunities that can be exploited based on a new applications of technologies.
It is interesting to note that small ventures such as Isobionics need not have required all the technology in-house.
Combining people with strong ideas and reputation with green technology projects is an interesting recipe for successful new ventures.
Because Outlast was the engineering partner in this venture, its technical competencies were crucial in developing the microcapsules.
they should be able to extract more value from the venture. The most important take-away is that value cannot be extracted from the collaboration to the detriment of the partners.
Adapting the arrangements to collaborate comfortably for all partners is necessary in most collaborative ventures.
Small (high-tech) companies, usually financed by venture capital funds, represent another interesting wellspring of external knowledge for large companies.
large companies have a strong incentive to become a preferred partner of these high-tech ventures.
which allows them to attract the ventures with the best technology. Open innovation also implies that large companies have to monetize their unused technology38.
selling it, spinning off a venture, or even divesting a new venture that is ready to sell its first products.
Several large companies succeeded in increasing the productivity of its knowledge base 78 by searching for different external paths to the market.
Some companies have a corporate venturing department, which among other activities spins off internal ventures.
The first, Isobionics, illustrates how an external entrepreneur can establish a successful venture by licensing technology from a large firm.
Classic venture capital funds (VCF) were somewhat reluctant to finance Isobionics at the time it was established,
because the venture needed considerable investments which were too big a risk for VCFS 80 in an early investment stage42.
The start-up was financed combining investments from VCFS, a regional venture capital investor in which DSM participated, bank loans,
and are eager to work with the venture. Finally, Toine also had to license the technology from DSM.
Isobionics illustrates how a promising venture can be established by licensing unused technology of a large company.
and/or monetize unused technology by licensing the technology or spinning off internal ventures. Consequently, new opportunities exist for small companies,
The venture manager, therefore, must be experienced in finding the innovation champions in the company and contact the decision makers directly to keep the project on top of the pile.
Business model innovations are high-risk ventures because a firm must search for new technologies and develop new products.
This, in turn, may endanger the open innovation venture. Licensing deals can also be negotiated in a way that allows both partners to profit maximally from the technology.
which emphasizes the role of experimenting in new venture management. Finally, the cases point to the need to integrate different management disciplines to understand open innovation in SMES.
Technology Ventures, Defense mechanisms and Corporate Relationships, Administrative Science Quarterly, 53: 295 332.36 See National Research Council (2004:
and pharma ventures. 43 Two inspiring articles to understand how complementary assets play a role in the value appropriation of innovations are Teece, D. J. 1986).
venture capital is abundant nowadays and the acceleration of the product life cycle has turned intellectual property (IP) into an increasingly perishable asset.
such as creating and spinning out new ventures, and the licensing of intellectual property to external parties (Chesbrough, 2003).
) several large high-tech companies spin off new ventures 8 because the business idea does not fit into the existing business model.
which turned into new ventures exceeded that of their parent company, Xerox, by a factor of two.
but the use of venture capital, outsourcing of R&d and the licensing of other firms'IP are also becoming more common nowadays.
for instance through minority holdings or corporate venture capital investments (Chesbrough, 2002; Dushnitsky and Lenox, 2005a; Ernst et al.
) Prior studies have shown already that corporate venture capital investments have a positive effect on the innovative performance of firms (Dushnitsky and Lenox, 2005b;
the increasing technological complexity to produce new products, the short product life cycles, the mobility of engineers and the rise of the venture capital industry have forced these firms to open up their innovation processes.
which SME companies establish new ventures as a part of their open innovation strategy is likely to depend on firm size.
Outsourcing of R&d and the spinning out of new ventures requires a structured and well organized innovation 15 process.
if firms had spun ever out new ventures, or licensed-out their own intellectual property in the period 2003-2005.
and investors (e g. banks, venture capital firms). 20 Finally, we looked at the degree firms participate by equity investments in new or existing companies,
In contrast, the results show that venturing is more popular among services firms compared to manufacturing firms service SMES spin out new ventures more often.
outsourcing of R&d, setting up new ventures, participation in new or existing firms, involvement of external partners in the innovation process, involvement of users in the innovation process, involvement of non
In this case, the new venture commercializes products that do not fit the corporate brand or strategy.
Making Sense of Corporate Venture capital. Harvard Business Review, March 2002,4-11 Chesbrough, H.,2003. Open Innovation:
When do firms undertake R&d by investing in new ventures? Strategic Management Journal 26,947-965.
When do incumbents learn from entrepreneurial ventures? Corporate venture capital and investing firm innovation rates. Research Policy 34,615-639.
EIRMA, 2003. Innovation through Spinning In and Out. Working group Report WG60, Eirma: Paris. EIRMA, 2004.
Corporate Venture capital as a Strategy for External Innovation: An Exploratory Empirical Study. R&d Management 25,233-242.
Entry and Exit when Markets Under and Over Shoot H200808 2-7-2008 Entrepreneurial Career Capital, Innovation and New Venture Export Orientation H200807 24-6-2008
A Statistical analysis of the Retail Industry H200723 21-12-2007 Overoptimism Among Entrepreneurs in New Ventures:
-Driven New Ventures in Economic growth: A Cross-country Analysis H200720 21-12-2007 Entrepreneurial exit in real and imagined markets H200719 21-12-2007 Modelling latent and actual entrepreneurship H200718
Ventures'Export Orientation: Outcome And Source Of Knowledge Spillovers H200712 29-10-2007 SME Choice of Direct and Indirect Export Modes:
EU Economy H200626 19-12-2006 Export Orientation among New Ventures and Economic growth H200625 18-12-2006 Institutionele voorwaarden voor zelfstandig ondernemerschap
These stories about applying open innovation in small firms successfully can barely be compared with the open innovation ventures of large manufacturing companies, such as Xerox, P&g, Philips, Lego, and IBM.
we focus on how fostering a good relationship between the new venture and the company that developed the technology is instrumental in producing a commercially successful venture.
The second example illustrates the opposite case: A small engineering company licensed its technology to a large company to develop a new product for the large company.
therefore also not surprising that it took Toine Janssen only a week before he decided to pursue the venture.
Many venture capital-backed high-tech ventures have been established to explore business opportunities that can be exploited based on a new applications of technologies.
It is interesting to note that small ventures such as Isobionics need not have required all the technology in-house.
Combining people with strong ideas and reputation with green technology projects is an interesting recipe for successful new ventures.
Because Outlast was the engineering partner in this venture, its technical competencies were crucial in developing the microcapsules.
they should be able to extract more value from the venture. The most important take-away is that value cannot be extracted from the collaboration to the detriment of the partners.
Adapting the arrangements to collaborate comfortably for all partners is necessary in most collaborative ventures.
Small (high-tech) companies, usually financed by venture capital funds, represent another interesting wellspring of external knowledge for large companies.
large companies have a strong incentive to become a preferred partner of these high-tech ventures.
which allows them to attract the ventures with the best technology. Open innovation also implies that large companies have to monetize their unused technology38.
selling it, spinning off a venture, or even divesting a new venture that is ready to sell its first products.
Several large companies succeeded in increasing the productivity of its knowledge base 78 by searching for different external paths to the market.
Some companies have a corporate venturing department, which among other activities spins off internal ventures.
The first, Isobionics, illustrates how an external entrepreneur can establish a successful venture by licensing technology from a large firm.
Classic venture capital funds (VCF) were somewhat reluctant to finance Isobionics at the time it was established,
because the venture needed considerable investments which were too big a risk for VCFS 80 in an early investment stage42.
The start-up was financed combining investments from VCFS, a regional venture capital investor in which DSM participated, bank loans,
and are eager to work with the venture. Finally, Toine also had to license the technology from DSM.
Isobionics illustrates how a promising venture can be established by licensing unused technology of a large company.
and/or monetize unused technology by licensing the technology or spinning off internal ventures. Consequently, new opportunities exist for small companies,
The venture manager, therefore, must be experienced in finding the innovation champions in the company and contact the decision makers directly to keep the project on top of the pile.
Business model innovations are high-risk ventures because a firm must search for new technologies and develop new products.
This, in turn, may endanger the open innovation venture. Licensing deals can also be negotiated in a way that allows both partners to profit maximally from the technology.
which emphasizes the role of experimenting in new venture management. Finally, the cases point to the need to integrate different management disciplines to understand open innovation in SMES.
Technology Ventures, Defense mechanisms and Corporate Relationships, Administrative Science Quarterly, 53: 295 332.36 See National Research Council (2004:
and pharma ventures. 43 Two inspiring articles to understand how complementary assets play a role in the value appropriation of innovations are Teece, D. J. 1986).
policies to back venture finance...68 5. 4 Japan: Diversification and clustering of SMES for future growth...
In Canada, combined SME support through R&d programmes and venture capital increased the number of high-growth companies considerably.
Improving access to venture capital (VC) may be a priority policy objective when supporting high-growth SMES.
aiming at establishing a European venture capital market. Section 4. 2. 2.)Internationalisation: Companies seeking to grow quickly need large international markets.
Canada provides insights about the combination of government-funded research and venture capital; Israel is of particular interest due to its current innovative and economic performance.
Since the high tech bubble burst there has been a drastic drop in capital financing, especially for venture capital (VC.
The Commission's main role could be to drive the further expansion and improvement of the Single Market, e g. for venture capital,
From a European perspective, this means e g. to realise a single market for venture capital. 10:
Data from various secondary sources is used here not only for exhibiting numbers of high-growth enterprises but also for other indicators such as venture capital provision.
One with OECD economist Jonathan Potter, one with US venture capital and innovation policy advisor Burton Lee,
High-growth finance includes primarily the availability of venture capital through business angels, specialised private companies, other corporations or public funds,
Venture capital should correlate with companies'growth stages. As regards real estate, innovative start-ups may benefit from business incubators as well as science and technology centres.
Dept, venture capital Real estate: science & technology parks Incentives Individual benefits Income: direct, e g. taxation, bankruptcy regulation;
These include wave ventures, new product in new category ventures, new product in existing category ventures and idea transfer/transplant ventures. 29 The wave strategy reflects the dynamic forces that can come out of early-stage companies.
Companies like Microsoft Genetech, Google and Facebook not only grew rapidly but also stimu-28 For recent studies on the issue of determinants of firm growth see Moreno/Casillas (2008);
See also Minniti (2008), p. 787, suggesting that in developed countries labour market reforms may be particularly conducive to support the growth of high-performance ventures. 34 Quotation from INNO-Grips Newsletter October 2010
business angel finance, venture finance, IPOS Dominant service Basic (standard) advice for firm creation, business planning, small business operation Experience-based
advice for venture finance; strategic planning, internationalisation; organisational growth Resource distribution principle Ensure equal access for everyone (resource spread) Select promising recipients (resource focus) Regulatory Emphasis Life cycle focus Remove bottlenecks to new
%the European commission (30%)and financial institutions (8. 8%),is a specialist provider of SME risk finance across Europe and a major player in the European venture capital market.
In 2009, the EIF combated the fall out of the financial crisis for venture funds in their fundraising efforts.
EIF can usually invest 10 to 25%of the total equity of the intermediary venture capital fund or up to 50%in specific cases;
EIF can invest 7. 5 to 15%of the total equity of the intermediary venture capital fund or, exceptionally, up to 50%.
The programme seeks to bridge the gap between start-up and larger international venture capital funding. Accelerace's services are sponsored for free
and whether the company may be a venture case. Timing is essential, says Accelerace senior management consultant Rebecca Scheel the applying companies need to be at the right development stage
after three months it may turn out that the company is not a venture case. After the programme it will be clear
Policies for high-growth innovative SMES v1. 6 34 omy together with Finland's most important R&d&i funding agency Tekes and Veraventure, a venture capital investment company
serving as the hub for public early-stage venture capital investments. VIGO is a type of incubator that focuses on young enterprises with high growth potential.
In January 2011 it organised the first Enterprise Finland Venture Forum, connecting 37 national and international financiers with 25 Finnish growth companies. 75 At the beginning of 2008 the innovation department of the Ministry of Employment and the Economy established a division for growth ventures.
The rationale behind creating this division was that the needs of growth companies may substantially differ from others,
which requires a special growth ventures policy 76.72 See http://www. vigo. fi. 73 See Murray/Hyytinen/Maula (2009),
For example, the label of The swiss CTI Start-up coaching programme has become an important determinant in attracting venture capital, angels'investment and other financing partners
Companies with considerable growth perspectives may be looking for venture capital i e. professional equity co-invested with the entrepreneur to fund an early-stage (seed and start-up) or expansion venture. 92 Venture capital is a subset of private equity.
Other sources of finance include leasing, factoring, hire-purchasing and trade credits. Finally, companies may use public subsidies in the form of direct grants, reduced interest rates for bank loans or deficit guarantees.
Discussions and analyses about high growth of companies often focus on venture capital. There are empirical indications that a well-functioning venture capital market is conducive to growth not only of single companies but also of national economies:
Venture capital injects economic dynamism: An increase in VC investments of 1 of GDP is associated statistically with an increase in real GDP growth of 0. 30 pp.
Early-stage investments have an even bigger impact of 0. 96 pp. The direction of causality is not always easy to establish.
often reliable data are not even available at the country level. 96 92 Definition of the European Venture capital Association,
%and Italy (12%).97 The economic and financial crisis has had starkly deteriorating effects on the venture capital market.
it is still difficult for high-growth oriented companies seeking venture capital to find adequate funding.
EVCA (2011) The level of development of venture capital markets and thus the difficulties to obtain VC are very different among European countries see Exhibit 4-3. The UK is the single largest VC market in Europe;
or expansion phase under the Competitiveness and Innovation framework Programme (CIP) for the years 2007 to 2013.105 Single market for venture capital investment:
At present, there is no integrated European venture capital market-the regulatory situation varies widely from country to country(..
The EU is seeking to unify the venture capital market(..To achieve this, it is promoting cross-border venture capital investments. 106 However,
while there is a consensus among Member States on promoting mutual recognition of national frameworks, no significant measures have been taken yet that would make fundraising
and Venture capital Association (EVCA) suggests to adapt and refine the existing structures of public support for venture capital
in order to increase its competitiveness, attract private investment and also to lead to a phased reduction of its dependence on public money. 109 The EVCA suggests a Venture capital Action Plan 2010-2020 for the EU,
following the EU's Risk capital Action Plan of 1998. According to the EVCA, the European VC market is fragmented highly
including the support of business ventures through dedicated funds fuelled by domestic and overseas sources as well as by investing in a fund of funds.
The government also plans to encourage venture capital investment from overseas funds, oil money, and other sources.
the Canadian experience suggests that a government focus on high-tech SMES combined with adequate levels of venture capital financing holds the greatest potential for creating gazelles and that these firms show unusual resiliency.
The Canadian experience (see section 5. 3) of linking governmental R&d funding with venture capital investment suggests to focus high-growth policies on technology-based industries
This may for example mean to focus policies on improving access to venture capital instead of access to micro credits. 142 How are policies for innovative high-growth SMES distinct from general SME policy?
and thus their competitiveness and the policies have supported the growth of the venture business. However, some of the traditional SME policies have been criticised for inefficiency and ineffectiveness.
the venture businessmen's special lecture programmes on entrepreneurship at universities; the youth start-up education programme;
Inno-biz and measures to strengthen venture capital investment The Korean government intensively fosters the programme inno-biz (acronym for innovative business.
innovative firms, ventures and firms with outstanding managerial innovations. The programme does not explicitly aspire to high growth
but at least the venture category implicitly carries the high growth objective. A company may belong to two or three categories at the same time.
Ventures, according to the SMBA definition, are firms in which venture capital is invested, which invest in R&d and
which commercialise new technology. 147 SMBA continues to promote the venture sector as a new growth engine.
The government is supporting business ventures, through the support of a one trillion won private fund, by investing in a Fund of Funds in 2009 as well as through a two trillion won fund with inducement of further funds
from the fiscal administration, the Korea Development Bank and foreign and private funds by 2012.
The government also plans to encourage venture capital investment from overseas funds oil money, and other sources.
147 See http://eng. smba. go. kr/pub/poli/poli040108. jsp#cer01 for the SMBA's venture certification criteria.
%In addition, the government plans to facilitate venture investment by institutional investors, the post office, insurance firms, universities,
Since the Korea Venture Fund has confirmed other investors, small investments of less than one billion won are allowed at any time.
In April 2009, the government created a venture ecological system that integrates the capabilities of newborn venture companies and of the leading venture companies in the market.
the government intends to create a ten billion won fund and support joint R&d and overseas marketing for ventures.
This programme is designed to promote the survival and growth of newly established venture companies. SMES are, for example, provided with land, consulting services,
In 2002 the Korean government recognised Donghwa Entec formally as a venture and an Inno-Biz in terms of government support schemes,
They comprise an increase of SME's R&d activities, an expansion of venture business, and various impacts on different areas of SME performance.
Expanded venture business All related indicators confirm the high growth in the venture business from 1998 to 2008,
For example, the number of certified ventures increased from 2, 042 firms in 1998 to 15,401 firms in 2008,
and there are now five graduate schools specialising in the venture business. However, figures for 2009 may indicate a decline caused by the worldwide economic crisis.
Development of the venture business in Korea 1998-2008 Indicator 1998 2008 Creation of venture firms Number of certified venture firms 2, 042 15,401 Thereof:
established by professor or researcher 582 1, 555 Number of graduate schools for venture business 0 5 Venture capital (in 100 mio.
KRW) New venture investments 7, 870 12,041 Newly established venture funds 4, 929 11,954 Foreign venture funds 30 702 Source:
Related services include for example law firms specialising in intellectual property and new ventures, human resources headhunting, consulting and market research,
policies to back venture finance Summary The Canadian experience suggests strongly that a concentrated focus by governments on high-tech based SMES combined with adequate levels of venture capital (VC) financing holds by far the greatest potential
Recently, the US venture capital sector has been lobbying hard to change the access rules to SBIR funding for SMES controlled by venture capital firms.
Background and objectives of VC funding and government assistance Canada Current situation in venture funding The Canadian experience suggests strongly that a concentrated focus by governments on high-tech based SMES combined with adequate levels of VC
when a combination of venture capital 150 See Cooper (2009). Policies for high-growth innovative SMES v1. 6 69 and IRAP assistance is available,
firms at the development stage with high burn rates have had to cut back activities. Even with these cutbacks, many of these firms have only one year or less left of funds available to them from earlier financing rounds,
According to the Canadian Angel Investment Network their members are currently investing over CAD 3 billion in Canadian businesses each year. 155 Venture capital:
USA Venture capital: The US experience is similar to that of Canada, in terms of the collapse of financing since the bubble burst in 2000 where VC dropped from a peak of 100 billion USD to just 18 billion USD in 2009.
there were state government sponsored VC funds in 22 states with 2. 3 billion USD in venture funds
However, a study by Cooper of 2, 240 firms which had received venture capital (CAD 18 billion dollars) between 1995 and 2005 showed much higher levels of gazelles creation at 12%in the 1, 500 technology based firms,
The Effects of Government-Sponsored Venture capital: International Evidence. 162 See Government involvement in the venture capital industry International comparisons,
http://www. cvca. ca/files/Downloads/Government involvement in the vc industry intl comparisons may 2010. pdf. 163 See Hellmann 2005 study. Policies for high-growth innovative SMES v1. 6 73 ticular interest in the richest program.
The Effects of Government-Sponsored Venture capital: International Evidence. CVCA, Canadian Venture capital Association (2009: Why Venture capital is Essential to the Canadian Economy-The Impact of Venture capital on the Canadian Economy.
Available at: http://www. cvca. ca/files/Downloads/CVCA VC IMPACT STUDY JAN 2009 FINAL ENGLISH. pdf 2010 October. CVCA (2010) and Kirk Falconer (2010) Thompson-Reuters. See http://www. cvca. ca/files/News/CVCA Q4 2010 VC PRESS RELEASE FINAL FEB 16 2011. pdf and http://www. canadavc. com/files
/public/Reseau%20capital 02-11 %20english. pdf Cooper, Denys (2009: High Growth and Survival of Government Funded SMES with Venture capital in Canada.
APEC SME Innovation conference 2009, Seoul. Duruflé, G, Government involvement in the venture capital industry International comparisons. http://www. cvca. ca/files/Downloads/Government involvement in the vc industry intl comparisons may 20 10. pdf. Gompers/Lerner (2004:
The Venture capital Cycle, Chapter 13, http://www. google. ca/#hl=en&biw=958&bih=444&q=lerner+impact+sbir&aq=f&aqi=&aql=&oq=&gs rfai=&fp
=23e 9afdc1c4696ce, Hellmann, Ilyaszade and Lee, 2010 An Evaluation of the Venture capital Program in British columbia, http://strategy. sauder. ubc. ca/hellmann/pdfs/Hellmann%20schure%202010
%20venture%20capital%20report. p df. Hellmann, Egan, and Brander, A Comparison of Exit Values across Canadian provinces and US States October 2005.
Ten Years'Lessons from the Canadian Labour-Sponsored Venture capital Corporations. NAS 2009: Awards-U s. Small Business Administration Tech-Net Database;
http://www. nasvf. org/pdfs/VCFUNDSREPORT. pdf). Venture Impact: The Economic Importance of Venture capital Backed Companies to the U s. Economy, 2008, June at http://www. asiaing. com/venture-impact-the-economic-importance-of-venture-capital-backedcompanies-to-the-u-s-ec
. html Wessner, Charles W. ed.)(2009: An Assessment of the Small Business Innovation Research Program at the Department of defense.
and then in the later commercialisation stages they prefer bank loans over equity finance, venture capital,
and acts as a venture capital fund in the early stages. An incubator company receives a development grant of up to 500,000 US dollar for a period of two years.
and other public authorities to promote joint Israeli-EU R&d ventures within the EU's R&d Framework Programme.
ventures are created not and obviously the keenly sought high growth ventures are realised not either. 173 Justification dilemma:
The crucial argument against direct and selective promotion of high-growth SMES is: Why promote those SMES that are successful anyway?
-growth innovative SMES v1. 6 90 Enhanced access to finance Enhancing the European venture capital market The European venture capital market is fragmented highly
and lacking intermediaries (see section 4. 2. 2). Opportunities for companies with high growth aspirations to find venture investors are thus suboptimal.
and venture capital Case studies conducted for this report indicate that governmental policies may support access to finance for high growth SMES indirectly.
see also EVCA (2010), p. 13.181 The EC launched a consultation on a new European regime for venture capital in June 2011.182 Statement from Allan Martel, member of the advisory board for this Policy Brief.
Measures aimed at providing funding for high-growth new ventures may find little opportunity to fund growth
Furthermore, governments should also not aspire to eliminate new venture failures. 192 3. Policies for general SMES
e g. for venture capital. 8. Enhance coaching opportunities: Qualified coaching may help grow SMES and cross the chasm between pilot markets and mass markets.
EVCA, European Private Equity and Venture capital Association (2011: Creating lasting value: Yearbook 2011. Harms, Rainer;
Venture growth new findings from a multilevel perspective Guest Editors'Introduction to the focus issue on growth.
Venture capital adds economic spice. Author: Thomas Meyer. Economics and politics research briefing. 14 september. Ministry of Employment and the Economy (2011:
Enterprise Finland Venture Forum: https://www. efvf2011. b2bmatchmaking. com/p index. php, last accessed May 2011.
Burton Lee, Innovarium Ventures, 17 august 2010. Rebecca Scheel, Accelerace programme, Business Advisor, 5 january 2011. Policies for high-growth innovative SMES v1. 6 104 Annex 1:
and Entrepreneurship 3 International Journal of Entrepreneurship and Innovation Management 4 International Small Business Journal 5 Journal of Developmental Entrepreneurship 6 Venture capital 7 International
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