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IDEA. SPIN-OFF. CAPITAL. Fraunhofer Venture. 29.02.2012, STOA-Workshop: „Knowledge Transfer form Public Research Organisations“ Sebastian Surma. Applied research by the Fraunhofer-Societey. More than 80 research institutions, including 60 Fraunhofer institutes - PowerPoint PPT PresentationTRANSCRIPT
IDEA SPIN-OFF CAPITAL
Fraunhofer Venture29.02.2012, STOA-Workshop: „Knowledge Transfer form Public Research Organisations“
Sebastian Surma
Applied research by the Fraunhofer-Societey
More than 80 research institutions, including 60 Fraunhofer institutes
More than 18,000 employees, the majority educated in the natural sciences or engineering
An annual research volume of €1.8 billion, of which €1.5 billion is generated through contract research.
70 percent of this research revenue derives from contracts with industry and from publicly financed research projects.
30 percent is contributed by the German federal government and the Länder governments in the form of institutional financing.
International collaboration through representative offices in Europe, the US, Asia and the Middle East
Financial structure of the Fraunhofer-SocietyAnnual research volume in Million €.
Accelerating innovation by creating regional focuses:Reinforcing strengthsCreating beacons of research
UniversityBasic Research
IndustryR&D for
Products and Services
Fraunhofer
Applied Research
Teamwork
Research Area – Region – Fraunhofer
Fraunhofer innovation clusters
5
Fraunhofer Venture
Spin-offSpin-off
Spin-offs as the 3rd technology transfer to the market.
Profits from spin-offs (research contracts, licensing fees, dividends and exits).
Cooperative networks between Fraunhofer and spin-offs.
Promotion of entrepreneurial thinking within Fraunhofer.
Spin-offs as the 3rd technology transfer to the market.
Profits from spin-offs (research contracts, licensing fees, dividends and exits).
Cooperative networks between Fraunhofer and spin-offs.
Promotion of entrepreneurial thinking within Fraunhofer.
contract research for industry
IPR management
Positive - practical approaches & lessons learned
6
1. Investor network
2. Internal funding
3. Fraunhofer infrastructure
4. Customer contact
5. Brand name
6. Lean operations
7. Employment options
Positive - practical approaches & lessons learned
7
1. Investor network
2. Internal funding
3. Fraunhofer infrastructure
4. Customer contact
5. Brand name
6. Lean operations
7. Employment options
>>> We maintain a very tight network
to VC's, Business Angels and state run
investment offices (Bayernkapital,
TGFS, HTGF). <<<
Positive - practical approaches & lessons learned
8
1. Investor network
2. Internal funding
3. Fraunhofer infrastructure
4. Customer contact
5. Brand name
6. Lean operations
7. Employment options
>>> Our internal funding and
supporting programs helps scientists
to become founders and good
managers (FFE & FFM – Fraunhofer
Funds Entrepreneurship, Fraunhofer
Funds Management). <<<
Positive - practical approaches & lessons learned
9
1. Investor network
2. Internal funding
3. Fraunhofer infrastructure
4. Customer contact
5. Brand name
6. Lean operations
7. Employment options
>>> We make sure to give scientists
the option to prepare their ventures
as good as possible within the
research institute, before going out on
the market and starting up. <<<
Positive - practical approaches & lessons learned
10
1. Investor network
2. Internal funding
3. Fraunhofer infrastructure
4. Customer contact
5. Brand name
6. Lean operations
7. Employment options
>>> We motivate our scientists to
develop their to-be-commercialized
product/service in close cooperation
with prospective customers. By this
way, they keep themselves clear form
the phenomenon of "analysis
paralysis" and at the same time build
up relationships to a prized client
base. <<<
Positive - practical approaches & lessons learned
11
1. Investor network
2. Internal funding
3. Fraunhofer infrastructure
4. Customer contact
5. Brand name
6. Lean operations
7. Employment options
>>> Our "Fraunhofer" brand is a very
precious asset, not just in the
scientific world. Every spin-off that
has its roots in one of our Fraunhofer
institutes massively gains credibility
by being connected to our brand
name. <<<
Positive - practical approaches & lessons learned
12
1. Investor network
2. Internal funding
3. Fraunhofer infrastructure
4. Customer contact
5. Brand name
6. Lean operations
7. Employment options
>>> We keep a close connection to
our spin off's. They perceive us as
their research backbone. This way
they don't need to build up their own
research division and can keep an
uncompromised market focus. <<<
Positive - practical approaches & lessons learned
13
1. Investor network
2. Internal funding
3. Fraunhofer infrastructure
4. Customer contact
5. Brand name
6. Lean operations
7. Employment options
>>> We give our scientists the feeling
that there still is a security string that
keeps them from falling if disaster
strikes (part time work options, "come
back" options, …). <<<
Negative – what we learned that does not work
14
1. Incentive system
2. Junior managers
3. Founders team
4. Decision process
5. Investment fund
6. Portfolio size
Negative – what we learned that does not work
15
1. Incentive system
2. Junior managers
3. Founders team
4. Decision process
5. Investment fund
6. Portfolio size
>>> It is of decisive importance to
make sure that the research institute
we want to spin a company out of
understands what it gains by a new
venture. It shouldn't perceive a spin-
off just as a loss of good talent and
research revenue. <<<
Negative – what we learned that does not work
16
1. Incentive system
2. Junior managers
3. Founders team
4. Decision process
5. Investment fund
6. Portfolio size
>>> We tried to enhance (founder)
teams with junior management
experts, who were supposed to focus
on just a single spin-off project and
eventually become part of that team.
<<<
Negative – what we learned that does not work
17
1. Incentive system
2. Junior managers
3. Founders team
4. Decision process
5. Investment fund
6. Portfolio size
>>> If we do not have the right team
(quality-wise) at hand we should not
start a company. Likewise, we should
not start a company with a team that
is to big then necessary. <<<
Negative – what we learned that does not work
18
1. Incentive system
2. Junior managers
3. Founders team
4. Decision process
5. Investment fund
6. Portfolio size
>>> The longer it takes us to come to
a decision whether we want to
support a given spin-off project (and
become shareholder) or not , the more
likely it will be that the team and their
(prospective) investors will start
thinking about doing it without
Fraunhofer. <<<
Negative – what we learned that does not work
19
1. Incentive system
2. Junior managers
3. Founders team
4. Decision process
5. Investment fund
6. Portfolio size
>>> Sometimes we miss the option to
use our own investment fund in order
to act quickly and independently. <<<
Negative – what we learned that does not work
20
1. Incentive system
2. Junior managers
3. Founders team
4. Decision process
5. Investment fund
6. Portfolio size
>>> To manage the rather big
portfolio of companies that
Fraunhofer holds shares of (~90)
consumes a lot of our time. Hence, we
learned that it is important to put
more emphasis on our exit strategies.
<<<
21
Annual earnings from spin-offs
Earnings from spin-offsmill. Euro2006 - 2010
Source: Fraunhofer Venture, 2011
Source: Fraunhofer-Gesellschaft, Sigma Datenbank, 2006
1,6
3,6 3,4
6,4
25,326,5
20,2
18,1 18,6
F&E-Erträge
Lizenzeinnahmen
Exits
2006 2007 2008 2009 2010
23,2
18,9
19,3
14,4
14,9
exits
leasing licencing fees
contract research
22
Fraunhofer Spin-offs
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Fraunhofer Venture
Contact
Sebastian SurmaSpin-offs and Investments
Fraunhofer VentureHansastrasse 27cD - 80686 MunichTel. +49 89 1205 - 4519Fax +49 89 1205 - 77 - 4519
http://www.fraunhoferventure.de