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Offer technology transfer and innovation support

Cross-border innovation advisory services (vouchers, intermediaries) appear to work well in several regions

Table 3.9. Cross-border innovation advisory services: Benefits and barriers

Benefits and barriers

Examples

Benefits:

  • - wider pool of possible providers
  • - critical mass to provide more specialised services
  • - raises awareness of other innovation actors across the border
  • - chance for SMEs to collaborate with foreign public and private entities Barriers:
  • - differing financial support rules based or distribution requirements based on the nationality of beneficiaries
  • - advertising the programme and its delivery mechanisms
  • - cumbersome rules and regulations, particularly for SMEs
  • - stimulating private sector demand
  • - Innovation vouchers in the TTR-ELAt and Ireland-Northern Ireland (UK)
  • - Nordic Business Links in the Bothnian Arc
  • - FUSION in Ireland-Northern Ireland (UK)

Cross-border innovation advisory services build greater functional linkages across the border as well as enable firms to benefit from more specialised innovation support. Innovation advisory services assist companies (generally SMEs) by providing advice and counselling for knowledge transfer and absorption. Placing skilled graduates in SMEs is another form of innovation advisory. These kinds of services may be implemented on a cross-border basis to facilitate knowledge transfer across national borders in sectors where particular expertise can be found in other jurisdictions. Connecting the more innovation-mature SMEs with multinational enterprises and research and technology development centres across the border can help develop innovation-oriented public- private initiatives. Equally, co-operation between research, technology and development (RTD) centres can help address issues of critical mass and capitalise on complementarities in skills and infrastructure. Several advisory and knowledge transfer programmes operating between Ireland and Northern Ireland are in place, such as InterTradeIreleand’s FUSION programme (Box 3.9).

Box 3.9. FUSION: Linking firms and skilled graduates in Ireland and Northern

Ireland (United Kingdom)

Through FUSION, support packages are available for a business in one jurisdiction to partner with a third-level institution on the other side of the border with the specialist expertise needed and a high-calibre science, engineering or technology graduate. The graduate is employed and based in the firm for a 12- or 18-month period with mentoring from the academic partner and a consultant from InterTradeIreland. The funding packages are worth up to GBP 44 250/EUR 52 800 in the area of new product/service development or a 12-month project worth GBP 31 000/EUR 37 000 in the area of process improvement.

The rationale behind the programme was that the border meant that knowledge or technology transfer programmes ran only within the two jurisdictions respectively and that businesses and academics were unable to work with a cohort across the border, creating a barrier to knowledge spillovers. The programme was developed as one of InterTradeIreland’s first initiatives in 2000 and is currently in its fourth phase. The key actors involved in the FUSION programme are firms, HEIs and graduates. The programme is jointly run and funded by InterTradeIreland, Invest Northern Ireland and Enterprise Ireland for a total amount of approximately EUR 3 million per annum. On average, each company taking part in the FUSION programme benefits from over GBP 1 million worth of sales or efficiency savings in the three years following the project.

Source: InterTradeIreland (2013), “Background report to OECD study: Cross-border regional innovation policies, Ireland and Northern Ireland”, January.

One of the instruments often applied in a cross-border situation is the innovation voucher. These publicly financed vouchers can be used to buy innovation services from knowledge providers (public research institutions or other firms depending on the definition of the scheme). They are often targeted to SMEs so that they build a first relationship with a knowledge institution (like a local university or technology centre) so that in the future, the SME will seek such collaboration opportunities on its own to innovate (OECD, 2011). The TTR-ELAt uses these vouchers in the context of efforts to support their Top Technology Clusters. The hope is that some of these arrangements will result in a “graduation” to the GCS Cross-Border Cluster Stimulation Programme. The Ireland-Northern Ireland (UK) example illustrates a mainstreaming approach whereby the business development agencies on both sides of the border have aligned their programmes to create a “virtual common pot” (Box 3.10).

Box 3.10. Innovation vouchers: An instrument easy to apply on a cross-border basis

The TTR-ELAt cross-border innovation vouchers have been developed especially to promote co-operation among SMEs within the region. The reason for establishing this instrument was the acknowledgment that to address even relatively minor problems for SMEs (such as IPR protection, legal support), it is important to provide companies with some kind of incentive. The innovation vouchers (part of the Top Technology Cluster-TTC project) has been particularly important in the early stage of the development of cross-border SME consortia. The voucher grants free research/advice from a knowledge provider within the area up to an amount of EUR 5 000 per business case (non-repayable grant). Activities that are eligible for funding include industrial research and experimental development (e.g. feasibility studies, patent research, use of laboratories and state-of-the-art equipment, or prototyping and testing). A necessary condition for granting a voucher is the presence of at least two SMEs located in two different cross-border jurisdictions in the list of beneficiaries. The two or more SMEs can use the voucher not only to share R&D collaboration but also to co-operate with third institutions like large companies, universities and research centres. The domains for which the vouchers have typically been granted are: energy, life sciences and high-tech systems. Decisions on voucher applications are taken by an ad hoc group of TTC partners. In total, 35 vouchers have been made available, 13 of which were issued during the second half of 2012. Thus far, the grants have been used in similar shares by consortia led by German, Dutch and Belgian SMEs.

Ireland and Northern Ireland jointly manage a cross-border innovation vouchers scheme, through the business development agencies Enterprise Ireland and Invest Northern Ireland. The two administrations provide joint funding for a unique scheme, accessible in both areas (EUR 4.1 million annual budget). Each voucher is worth EUR 5 000 and can be used by the enterprises to employ a knowledge provider (such as a higher education institution) to overcome a technical problem. The firms and knowledge providers can be located either in Ireland or Northern Ireland. This joint cross-border publicly funded programme is therefore a “virtual” common pot.

Sources: Nauwelaers, C., K. Maguire and G. Ajmone Marsan (2013), “The case of Ireland-Northern Ireland (United Kingdom) - Regions and Innovation: Collaborating Across Borders”, OECD Regional Development Working Papers, No. 2013/20, OECD Publishing, Paris, http://dx.doi.org/10.1787/10.1787/5k3xv0llxhmr-en: Nauwelaers, C., K. Maguire and G. Ajmone Marsan (2013), “The case of the Top Technology Region/Eindhoven-Leuven-Aachen Triangle (TTR-ELAt) - Regions and Innovation: Collaborating Across Borders”, OECD Regional Development Working Papers, No. 2013/22, OECD Publishing, Paris, http://dx.doi.org/10.1787/10.1787/5k3xv0lg3hf5-en.

Advisory services to spin-off and knowledge intensive start-up firms reinforces a dynamic ecosystem

Table 3.10. Advisory services to spin-off and start-up firms: Benefits and barriers

Benefits and barriers

Examples

Benefits:

  • - broader network of advisers, partners and investors for entrepreneurs
  • - build on peer experiences from other countries
  • - greater specialisation of advisory services (e.g. by sector)

Barriers:

  • - lack of alignment of activities of similar organisations across the border
  • - difficulties in identifying coaches or entrepreneurs
  • - Start-Smart, Cross-Border Small Business Environment, Start-up Sauna in Helsinki-Tallinn
  • - TwinEnterpreneurs in Centrope

Instruments specifically targeting start-ups and spin-offs appear less widely used on a cross-border basis, one exception being in the Helsinki-Tallinn cross-border area (Box 3.11). Both cities are characterised by a dynamic ecosystem of young and

Box 3.11. Promoting start-ups: Examples from the Helsinki-Tallinn cross-border area

Start-Smart is a co-operative cross-border project financed by the Interreg IV A Programme 2007-13, Southern Finland-Estonia. The partners are: the Estonian Development Fund (lead partner), the Small Business Center of Aalto University in Finland, BDA Consulting OU, Enterprise Estonia, and AS Technopolis Ulemiste in Estonia. The aim is to support entrepreneurial attitudes in both countries and accelerate the emergence of innovative enterprises. Activities include: workshops and seminars in Estonia and Finland with international speakers; start-up demo pitching nights; a mapping of the Estonian and Finnish start-up ecosystem; a start-up database; one-to-one mentoring; one-to-one consultancy (for business plan development, business modelling or marketing) and awareness raising via social media channels.

The Cross-Border Small Business Environment project established a network between southern Finnish and Estonian business incubators, with the goal to develop business activities and competitiveness of the Finnish and Estonian companies participating in the project in three main activities:

  • • network development of Finnish (southern Finland) and Estonian business incubators
  • • the development of a training programme for the managers of business incubators and technology parks, which include a best practice exchange and implementation
  • • the provision of support and information services for Finnish and Estonian companies in developing their business activities and competitiveness.

The project has provided market surveys, consulting, training services and thematic seminars for southern Finnish and Estonian SMEs. Participants in the project gained new business partners and customers, as well as knowledge about the Finnish-Estonian business environment and cross-border business opportunities.

Startup Sauna, founded in 2010, is a non-profit organisation for start-ups and aspiring entrepreneurs in northern and Eastern Europe and the Russian Federation. Its aim is to implement a blooming start-up ecosystem and a pay-it-forward culture into the region in order to make it the best place to be a start-up. Startup Sauna is physically located on Aalto University’s campus in Espoo, Finland (Helsinki metropolitan area). Run by its own foundation, Startup Sauna is funded by Aalto University, Teknologiateollisuus, Sitra and Tekes, among others. In practice, Startup Sauna consists of three different operations:

  • 1. An internship programme for aspiring entrepreneurs to work at high-growth companies in Helsinki and Silicon Valley. More than 60 interns have been matched to date through the programme.
  • 2. An accelerator programme for early-stage start-ups from northern Europe and the Russian Federation, where the companies are coached by experienced serial entrepreneurs and investors in an intense one-month programme in Helsinki. Ninety companies have graduated from the programme since 2010, with more than USD 25 million of funding raised.
  • 3. The Slush conference, which brings together the early-stage start-up ecosystem in the region to meet top-tier venture capitalists and media from around the world.

Sources: Nauwelaers, C., K. Maguire and G. Ajmone Marsan (2013c), “The case of Helsinki-Tallinn (Finland-Estonia) - Regions and Innovation: Collaborating Across Borders”, OECD Regional Development Working Papers, No. 2013/19, OECD Publishing, Paris, http://dx.doi.org/10.1787/10.1787/5k3xv0lrt1r6-en.

promising start-ups, especially in the ICT sector. The successful e-service field and favourable tax regime on the Estonian side and the start-up friendly environment in the Helsinki area (especially in the gaming and cell phone applications industries) make start-up assets an area for common cross-border promotion. The FINEST Startup programme (also known as Start-Smart) is a joint programme to promote entrepreneurship in the Helsinki-Tallinn cross-border area, co-funded by the European Territorial Co-operation (Interreg) programme. The main objective of Start-Smart is to promote entrepreneurial activities and attitudes in Estonia and Finland and to support the birth of new internationally competitive innovative companies. In the framework of the programme, thematic and practical workshops, conferences and other types of events are organised with the aim to coach entrepreneurs to develop new ideas. Other examples of cross-border co-operation targeting start-ups are knowledge and practice exchanges between Helsinki and Tallinn with respect to business accelerators in the gaming industry (the Gamefounders and Startup Sauna programmes). In the Centrope cross-border area, the TwinEntrepreneurs initiative is a cross-border co-operative project launched by the Vienna Business Agency, the Young Entrepreneurs Association of Slovakia and National Agency for Development of Small and Medium Enterprises. The partners provide joint support (workshops, coaching, networking events) for start-ups and SMEs in the Vienna-Bratislava region. Encouragement and support for young firms to extend their activities across the border is another important goal.

 
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