Technology Transfer Financial Facility

Transcription

1 Technology Transfer Financial Facility Alessandro Fazio Geneva 28 June 2013

2 European TTO Circle Vision: to be an actor of the innovation chain in Europe and a reference for Research, Development, and Innovation policies + to be a laboratory for testing new initiatives and synergies in Knowledge Transfer Work Package 1 Facilitate the use and the dissemination of existing Know-how and Intellectual Property Work Package 2 Create a Technology Transfer Financial Facility Work Package 3 Foster a European Entrepreneurship ecosystem Work Package 4 Strengthen European Technology Transfer Offices

3 Technology Transfer Financial Facility Innovation Union Commitment 22 development of the knowledge market Objective Accelerate the commercialisation of public research results with a particular focus on early stage technologies

4 TT financing Handful of specialised funds not classical VC. VC not equipped to handle small transactions at the (pre-) seed financing stage: Compensation structures Short lifespan Lack of flexibility Business angels under-developed in many parts of the EU.

5 ChaTT lmerfun s d Innlink ovated ion to SeeCha Funs d lmer d, Uni Swe vers denity Entmen erprt Dev elop iseagen Irela cy; nd, dedi Irela cate ndd TT sche me natio nal instit INRIute A, for FraICT; ncededi cate d TT fund TTO and TT fund for Ca mbri dge Field Trips Chalmers Innovation Seed Fund, Sweden Enterprise Ireland, Ireland INRIA, France TT fund linked to Chalmers University Development agency; dedicated TT scheme national institute for ICT; dedicated TT fund Imperial Innovations plc, UK TTO and TT fund for Cambridge and Oxford Universities, University College London, and Imperial College; TT + VC finance High-Tech Gründerfonds, Germany Max-Plank-Gesellschaft, Fraunhofer Venture, Ascension, Germany National TT and early-stage fund TTOs and TT fund PROs spin-outs Scottish Enterprise, UK Scottish development agency; dedicated TT scheme Technology Transfer funds, various/ Israel including the Technological Incubators Programme of the Ministry of Industry & Trade and the TT scheme of the Weizmann Institute of Science TT funds linked to universities; nation-wide scheme University of Leuven, CD3, Belgium TT fund of Leuven University University of Manchester Intellectual Property (UMIP), UK TTO and fund of Manchester University University of Twente, Netherlands VTT and VTT Ventures, Finland TTO and fund Finish innovation agency and TT + VC fund

6 Key findings TT finance should cover both licensing and the creation of new companies through spin-outs. Funding for different phases of TT from PoC through to commercialisation Spin-out firm creation less frequent than licensing IP or contract research Private capital available after proof-of-concept, and not before company creation Finding co-investors in the final development of the technology is critical. Identifying projects or deal-flow is also critical Identification methods include networks of scouts with close knowledge of the capabilities and outputs of university research teams.

7 Key findings Independent assessment and selection is crucial to minimise the risk of bringing forward projects of little commercial value TT is a hands-on business that requires both close proximity to a technology's developers and deep understanding of the research fields concerned. Successful TT depends on proximity Different views depending on sector on where the gap is Clear demand for financing for additional tech transfer Avoid introducing distortions and crowding out

8 No Consensus on Centralised or decentralised Risk sharing pari passu or subordination Interest in the possible use of equity or equity-like instruments for a TT fund, but no common view on a specific form.

9 Principles Risk sharing (equity/quasi equity) From Proof-of-concept to Pre-seed Speed Perspective and continuity Pilot Co-investment

10 An EU facility for Tech Transfer TT support via dedicated EU financing facility equity, quasi-equity, loan finance or a combination Funding to single final beneficiaries for investment in proof-of-concept, demonstration and commercialisation activities. Risk-capital finance for technology transfer coming from Horizon 2020 Access to Risk Finance budget Made available through an entrusted entity of the European Commission and/or via financial intermediaries (i.e. investment funds, technology transfer vehicles or schemes, TTOs) investing in final beneficiaries. complemented by capacity-building measures to support the professionalisation of TT

11 TTFF In partnership with an external managing entity Commission contribution Commission contribution TTFF ME contribution Managed by external ME contribution Managing Entity

12 Structured in three compartments License POC POC+ Pre-Seed Sell

13 Two main approaches a centralised approach, with a dedicated fund and centrally organised governance and decision-making, with co-financing at project-level; a decentralised approach, involving a co-financing mechanism via TT intermediaries that match EU funding, and with investment decisions made by each intermediary concerned.

14 Centralised Set up of a new investment fund managed by an entrusted entity on behalf of the Commission. Investment decisions centralised part of Horizon 2020 financial instruments Matching financial contribution from entrusted entity Third party investment also possible Selection and appointment of a central management team responsible for due diligence of investment opportunities and management of portfolio EU contribution subordinated to that of other investors

15 Decentralised EU co-financing TT investments with established financial intermediaries TT funds, schemes and TTOs on a paripassu basis. Part of the H2020 financial instruments Entrusted entity manages scheme matches EC pari-passu Three-year pilot phase from 2014 to 2016 Finance to final beneficiaries through financial intermediaries TT funds linked to universities, national or regional TT operators and TTOs Financial intermediaries take investment decisions based on EC directions

16 Centralised Dedicated fund created to which EU contributes EU contribution matched by an equivalent contribution from entrusted entity and others. Fund manager responsible for due diligence of investments together with evaluation and investment committees Fund holds assets, manages them, and disinvests as required. Deal origination mainly from TTOs EU contribution probably subordinated to that of other investors High administrative costs Leverage obtained by requiring co-investment as activities get closer to the market New source of TT Finance established

17 Decentralised EC facility or window under the Horizon 2020 equity facility. Managing Entity provides matching funding Investment decisions made by TT funds or schemes operating as intermediaries subject to eligibility criteria specified by the EC. Investment could happen pari-passu or see the EC subordinated to the entrusted entity. Leverage being the main differentiating criteria Overall leverage effect at least 2 TT facility would co-invest with local intermediaries therefore increasing leverage even further. Scheme would be complementary to existing instruments to avoid distortions and crowding out

18 Centralised Scheme Key advantages Particular additionality at EU level by offering a channel for assessing investment opportunities that do not have access to national, regional or local TT finance, notably in the newer Member States. Visibility for the Commission in launching and managing a novel financial instrument facility supporting TT. Key drawbacks High running costs. Commission would have to create a large central structure. Would require a clearly defined single model of intervention, which may not be suitable for all projects. Commission would be a subordinated investor taking any first loss and only making a return after other investors have guaranteed their return.

19 Decentralised Scheme Key advantages Would be relatively quick to implement and in the light of experience easy to adjust, rescale. As indirect investor, Commission would not incur large running costs. Commission would not have to select a specific one-sizefits-all model Key drawbacks Does not offer a channel for assessing investment opportunities that do not have access to national, regional or local TT finance, notably in the newer Member States.

20 Timeline Ex-Ante evaluation being finalised Final decision on approach in the autumn Detailed negotiations before year end Kick off with H2020 early in 2014

21 European Commission 2013 Alessandro FAZIO