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

MOEA SMEA 3 I.Objectives  Current Market Challenges to SMEs 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 and confidence Winter is over, Spring is yet to come Micro - challenges Macro - challenges

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

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

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

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

MOEA SMEA 8 Small Business Innovative Research (SBIR) Scheme Phase I Preliminary Research Phase I Preliminary Research To evaluate scientific technical feasibility as industrial impact of an innovative idea Max:6 months R&D Alliance: 9 months 50% of project budget Max: NTD 1 M. R&D Alliance: NTD 5 M. Phase II R&D Phase II R&D To implement R&D upon related technology and product based on an innovative and precise technical target which has completed feasibility evaluation Max:2 years (3 years for Biotech R&D) 50% of project budget Max: NTD 10 M. R&D Alliance: NTD 50 M. Phase II+ Value- added applications Phase II+ Value- added applications To commercialize R&D results upon related test production, design and market survey Max:1 year (1.5 years for Biotech R&D) 50% of project budget Max: NTD 5 M. R&D Alliance: NTD 25 M. 2. Financial Support

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

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

MOEA SMEA Awards and Rewards Commercialization to Markets  Rising Star Award R&D to Commercialization  SMEs Innovation Research Award Ideas to R&D  Business Start- up Award Innovation Stage Commercialization Stage

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

MOEA SMEA 13 III. Policy Results 1. Business Incubation (2001~2008) Business Incubation Employment created 83,435 Listed on TWSE Market and OTC 53 Listed on TWSE Market and OTC 53 Total SMEs incubated 3,634 Total Investment NT$146,844 M Average Survival Rate 87.53%

MOEA SMEA Financial Support No. of applied No. of approved Approved rate54%48%56%60%47%  SBIR Scheme

MOEA SMEA Business Matching No. of matching activities Cases of conferred ,2764,060 Cases of Successful matching Amount of Successful matching (NT$/thousand) 52,000159,00064,000273,000286,840

MOEA SMEA Awards and Rewards No. of candidates No. of prizewinner Rate17%25%16%26%27%  SMEs Innovation & Research Award No. of candidates No. of prizewinner Rate43%23%26%18%22%  Rising Star Award

MOEA SMEA 17 IV. Conclusion 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.

MOEA SMEA 18 Thank you for your attention