1. 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

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

3. 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

4. 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

5. 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

6. 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

7. 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

8. 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

9. 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 + 2.25% Interest Rate

10. 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

11. MOEA SMEA 11 4. 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

12. 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

13. 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%

14. MOEA SMEA 14 2. Financial Support 20042005200620072008 No. of applied518589569609665 No. of approved279285319364313 Approved rate54%48%56%60%47%  SBIR Scheme

15. MOEA SMEA 15 3. Business Matching 20042005200620072008 No. of matching activities 4451514 Cases of conferred 2613938115,2764,060 Cases of Successful matching 7411191435397 Amount of Successful matching (NT$/thousand) 52,000159,00064,000273,000286,840

16. MOEA SMEA 16 4. Awards and Rewards 20042005200620072008 No. of candidates213200139121112 No. of prizewinner3650223130 Rate17%25%16%26%27%  SMEs Innovation & Research Award 20042005200620072008 No. of candidates4075425149 No. of prizewinner17 119 Rate43%23%26%18%22%  Rising Star Award

17. 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.

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