27/09/2007

Recently, the European SEED-REG project ("Development of specific regional policies through the analysis of early-stage financing opportunities for innovative start-ups and spin-offs") was completed. This was implemented within the framework of the Community initiative INTERREG IIIC East. The Central Macedonian Centre for Research and Technology Hellas (CERTH) took part in the project, the aim of which was to improve the effectiveness of regional policies and start-up financing tools for innovative business activities. Other participants were regional development services and centres to support innovative business from five other European regions (Brandenburg, Slovenia, Central Bohemia, Central Hungary and Southern Hungary).

The creation of competitive advantage based on innovation is seen as a vital prerequisite in achieving sustainable development. The development of innovative business activities is based, first and foremost, on making good use of knowledge produced by research and educational bodies. In order to translate research results into practical applications, there is a need for effective incentive and financial support mechanisms, especially in the crucial early stages of development.

Despite this vital need, however, early-stage financing tools are still limited and not very effective, particularly for the less-developed and new Member States of the EU, since they are still considered to be at low levels of high-risk business capital investment.

As part of the SEED-REG project, an analysis was carried out of the existing situation in each region involved, 21 good practices were collected and assessed at pan-European level in relation to the support of innovative businesses, and an early-stage financing model strategy was designed. This strategy served as the basis for the development of new, improved early-stage financing mechanisms, geared to the specific features of each region. Particular emphasis was placed on the feasibility study into the creation of regional seed capital funds and innovation financing mechanisms aimed at exploiting the commercial potential of research results and carrying out innovative business activities (spin-offs development).

The proposed mechanisms cover a range of financing needs at the early development stage, from registration of intellectual property rights to first sales. The models sketched out within the programme bring together public and private capital and envisage cooperation between the public and private sectors in order to put successful interventions into effect.

The project has had a positive impact in the participating regions. In three of these regions (Slovenia, Central Hungary and Southern Hungary) negotiations are already underway for the creation of "business angels" networks and regional seed capital funds within the framework of the European initiative JEREMIE, while all of them intend to further investigate the development of pre-seed support tools within the framework of related regional initiatives.

Source: Centre for Research and Technology Hellas - CΕRTH