MOEA SMEA APEC 2009 SME Innovation Seminar Innovation

MOEA SMEA APEC 2009 SME Innovation Seminar Innovation in SME Financing and Marketing Session II: Establishing a Market – based Economic Environment Su, Wen-Ling Director Small and Medium Enterprise Administration, MOEA Chinese Taipei August 25~28, 2009 Seoul, Korea

MOEA SMEA Contents I. Objectives II. Policies to Commercialized SMEs’ Innovation III. Policies Result IV. Conclusion 2

MOEA SMEA I. Objectives u Current Market Challenges to SMEs Micro - challenges • Lack of marketability for innovation results • Lack of channels to explore the new products • Lack of market information for the innovation • Worldwide downturn & shrinking • Shrinking demand confidence • Winter is over, Spring is yet to come Macro - challenges 3

MOEA SMEA u Objectives of Commercialized Innovation Enhancing SME’s ability of commercialization Providing fund support for SMEs innovation Encouraging SMEs to R&D continually Building a business matching mechanism Raising acceptance of SME’s new products 4

MOEA SMEA II. Policy to Commercialize SMEs’ Innovation Framework on Commercializing Innovation Ideas Innovation Value Creation Market Business Matching Business Incubation Financial Support Awards & Rewards Policy Schemes for SMEs’ Innovation 5

MOEA SMEA 1. Business Incubation Services provided by Business Incubators Technological Support Business Support Space & Facilities Information Support Access to Universities’ and R%D Institutes’ Services 6

MOEA SMEA Incubating Process for SMEs R&D MARKET Value Created Testing INNOVATION • Lab Equipment • Product Acceptance Review Design & Development • Patent Application IDEAS Specification • Technology Transfer • Recruiting & Training • Consultation • Government Support Feasibility Study • Marketing Intelligence • Patent Search Innovation Process 7

MOEA SMEA 2. Financial Support Small Business Innovative Research (SBIR) Scheme Phase I Preliminary Research Phase II R&D Phase II+ Valueadded applications To evaluate scientific technical feasibility as industrial impact of an innovative idea 50% of project budget Max: NTD 1 M. R&D Alliance: NTD 5 M. Max: 6 months R&D Alliance: 9 months To implement R&D upon related technology and product based on an innovative and precise technical target which has completed feasibility evaluation 50% of project budget Max: NTD 10 M. R&D Alliance: NTD 50 M. Max: 2 years (3 years for Biotech R&D) To commercialize R&D results upon related test production, design and market survey 50% of project budget Max: NTD 5 M. R&D Alliance: NTD 25 M. Max: 1 year (1. 5 years for Biotech R&D) 8

MOEA SMEA Industry R&D Loans Scheme Purpose to encourage SMEs enhancing R&D capability for promoting SME’s competition ability and increasing the value of products Loan Amount Maximum 80% of project budget and not more than NT$65 M Period of Loan Not longer than 7 years Applicable Industry 1. 2. 3. 4. Interest Rate Period of project Not higher than 2 year deposit rate + 2. 25% 2~3 years Internet and Multi-media Service Manufacturing Professional, Scientific and Technology Service Culture & Creation 9

MOEA SMEA 3. Business Matching Boosting acceptance of new products Demand Side 1. VC & Angel 2. Marketing agents 3. SMEs who seek key techniques Business Matching Developing new business opportunities Accelerating innovation Commercialization Presentation New Techniques/Products Exhibition New Techniques/Products Business Negotiation One-to-one Discussi & Negotiate New Product Exhibition Technomart Strengthening online marketing ability Supply Side 1. SMEs who own new techniques 2. SMEs who own new products Web Demonstration 10

MOEA SMEA 4. Awards and Rewards n o i t a z i l a ci ets r e m ark m e o g M C a o t t S ar t S n g io n o i n t t s o i a R v &D lizati o u R rd n a w i I c A r n e o i m t a m v o o C nn ward I s E D A M & h S R c r u sea o t s Re t r a Idea St n s o s i e t a z i usin ard l B a i u c w r e m up A m o age C St 11

MOEA Idea to R&D Business Start-up Award ØCandidates: SMEs established less than 3 years ØNumber rewarded: Select 3 from each of following 4 groups : • micro-enterprise, • service industry, • technology industry, • traditional industry ØRewards: • 1 st NT$150, 000 • 2 nd NT$100, 000 • 3 rd NT$50, 000 SMEA R&D to Commercialization to Markets SMEs Innovation & Research Award Rising Star Award ØSubjects of rewarded: Product items ØCandidates: SMEs with R&D expenses accounts for more than 2% of total sales ØNumber rewarded: 30 items per year ØRewards: NT$300, 000 for each prizewinner ØCandidates: SMEs with exports accounts for more than 20% of total sales ØNumber rewarded: Not more than 15 SMEs per year ØRewards: Open commendation 12

MOEA SMEA III. Policy Results 1. Business Incubation(2001~2008) Total SMEs incubated 3, 634 Total Investment NT$146, 844 M Employment created 83, 435 Business Incubation Listed on TWSE Market and OTC 53 Average Survival Rate 87. 53% 13

MOEA SMEA 2. Financial Support Ø SBIR Scheme 2004 2005 2006 2007 2008 No. of applied 518 589 569 609 665 No. of approved 279 285 319 364 313 Approved rate 54% 48% 56% 60% 47% 14

MOEA SMEA 3. Business Matching 2004 No. of matching activities 2005 2006 2007 2008 4 4 5 15 14 Cases of conferred 261 393 811 5, 276 4, 060 Cases of Successful matching 74 111 91 435 397 52, 000 159, 000 64, 000 273, 000 286, 840 Amount of Successful matching (NT$/thousand) 15

MOEA SMEA 4. Awards and Rewards Ø SMEs Innovation & Research Award 2004 2005 2006 2007 2008 No. of candidates 213 200 139 121 112 No. of prizewinner 36 50 22 31 30 17% 25% 16% 27% 2004 2005 2006 2007 2008 No. of candidates 40 75 42 51 49 No. of prizewinner 17 17 11 9 11 43% 26% 18% 22%16 Rate Ø Rising Star Award Rate

MOEA IV. Conclusion SMEA Innovation policies should provide channels for SMEs to have access to the supports of financing, R&D, marketing and commercialization, as well as should promote technological and human skills upgrading. We all have done much. Which is the best practice? It depends on the development stage, macro-economic environment, and the real demand of SMEs. 17

MOEA SMEA Thank you for your attention http: //www. moeasmea. gov. tw 18