Chasing Funds: Start-ups from a Global Value Chains Approach (original) (raw)

Development Bank, Law and Innovation Financing in a New Brazilian Economy

The Law and Development Review, 2000

This paper examines new ways of direct state intervention in Brazil's financial environment, which has a prevailing development bank (state-owned financial institution) – BNDES (National Economic and Social Development Bank). The main purpose of the article is to describe the new role and legal tools developed by BNDES to finance innovation and start up companies. The analysis shows that not only the financing of innovation has become paramount within the BNDES agenda, but also that this activity has been associated with a new rationale for intervention. Instead of taking the place of the financial market, BNDES tries to leverage the financial sector, mainly its venture capital sector. Particularly, it will examine four kinds of legal tools, which have been developed by BNDES since the beginning of the nineties to spur innovative companies. The legal tools are: (i) equity participations; (ii) credit contracts; (iii) indirect participation in private venture capital funds; and (i...

Institutions That Foster Innovative Entrepreneurship in Brazil: Mapping and Connections

Revista Prâksis, 2020

This paper contemplates the deepening of a research conducted by the Brazilian Micro and Small Business Support Service (SEBRAE) during the 26th Anprotec Conference held in Fortaleza, state of Ceará, in the year of 2016. The research included a method to map out the needs of the Brazilian Innovation Ecosystem and covered ten institutions such as Accelerators, represented by ABRAII (Brazilian Association of Innovation and Investment Accelerators), Co-working spaces-represented by the Impact Hub. a Development Bank, FINEP (Studies and Projects Funding Agency), Anjos do Brasil; Venture Capital Investment Funds-represented by ABVCAP (Brazilian Association of Private Equity & Venture Capital), Incubators-represented by SUPERA Incubator, SEBRAE (Brazilian Micro and Small Business Support Service), Businesses-represented by Samsung Brazil and Technology Innovation Nuclei, part of Universities, represented by FORTEC (National Forum of Managers of Innovation and Technology Transfer). For this mapping, a matrix that considers the business development stage model was used to identify key actions and gaps in innovative entrepreneurship fostering in Brazil, also taking five critical business development variables into consideration-technology, talent, finance, location, and evolution. The results point to recurrences and lack of support and contribute with proposals for the Brazilian innovation ecosystem. Keywords: Innovative entrepreneurship. Innovation ecosystem. Network of institutions. RESUMO Este artigo contempla o aprofundamento de uma pesquisa realizada pelo Serviço Brasileiro de Apoio às Micro e Pequenas Empresas (SEBRAE) durante a 26ª Conferência Anprotec, realizada em Fortaleza, Ceará, no ano de 2016. A pesquisa incluiu um método para mapear as necessidades do Ecossistema Brasileiro de Inovação e cobriu dez instituições tais como Aceleradoras, representadas pela ABRAII (Associação Brasileira de

Particularities in financing tools: A case study of an Agency for Science, Technology and Innovation of Rio de Janeiro State, Brazil

Revista de Administração, Sociedade e Inovação, 2020

This work aims to analyze the objectives and interactions of innovation financing tools from a point of view of a technology, research and innovation foundation. It brings as subject the case of the Technology, Research and Innovation Foundation of the State of Rio de Janeiro (FAPERJ), and its incorporation of a Technology Board. Working side by side with a Scientific Board, it faces the challenge of interact, finance, and boost innovation, whereas the Foundation carries more than 40 years of basic research funding (1980 until 2019) the financing of innovation activities was incorporated in 2002. With the R&D activities in Brazil centered on public University, Research Institutes and only a small presence in companies (only 5% of the innovative companies perform R&D), FAPERJ's faces the challenge of create financing tools that improves the interaction between these actors. The sample analyzed in this study relates the eligibility criteria used in the FAPERJ's Technological Development Support (ADT) with similar and inspiring program, the United States of America Small Business Innovation Research (SBIR). As result, we have found the lack of incentives for interaction between universities and business sector, showing that only a small part of the projects financed by FAPERJ can reach the commercialization.

INNOVATION POLICIES IN BRAZIL DURING THE 2000S: THE NEED FOR NEW PATHS

Over the last few years, the Brazilian government has been very active in implementing a broad range of new policies to foster innovation in the country. Despite these efforts, outcomes have been modest. The question is why? First, we argue that there are systemic conditions – factors related to competition and the institutional environment – that reduce the Brazilian economy’s capacity to innovate. Second, both the design and the implementation of Science, Technology and Innovation (ST&I) policies lack the necessary efficiency to transform scientific potential capacities into private innovation. Regardless, it can certainly be said that Brazil has a diversified set of innovation policies and programs, from tax incentives and low-cost lines of credit to grants for firms and researchers. Brazil has also adopted a number of regulatory measures, as well as a few demand-side innovation policies (DSIPs). Taking into account all federal and state government investments in addition to the public tax waiver and compulsory R&D, the government sector infused (and not invested) in the Brazilian ST&I system (directly and indirectly) more than R$ 52.2 billion (around US$ 28.2 bi) in 2015. It is important to mention that not all R&D investments from Petrobras are included in these figures, although the private compulsory investment controlled by the National Oil Agency (ANP) includes Petrobras’ contribution. Despite the efforts of the last decade, nothing has really changed in terms of the R&D structure and intensity of the Brazilian economy. In fact, business participation in R&D has decreased between 2000 and 2014. Business R&D intensity – which had been quite stable over the entire period – did increase slightly in 2014. However, this was due to the low growth of the Brazilian GDP and uncommon expenditures on external R&D by telecom service companies (possibly related to the FIFA World Cup and the Olympic Games). Therefore, in general, there seems to have been little or no change in private behavior with respect to R&D efforts. This stable pattern in BERD consolidates Brazil’s peripheral position regarding R&D intensity on the international stage. In the last 10 years and in terms of the total number of patents in the United States Patent Office (USPTO), the Brazilian situation is still unchanged. In other words, Brazil is still a peripheral country, even when compared to developing countries like India and particularly China. Taking into account total R&D investment, each patent granted to a Brazilian firm or individual by the USPTO in 2015 cost, on average, US$ 109 million, which is much more than the Chinese cost of US$ 43 million per patent in 2014 and the Indian cost of US$ 37 million per patent in 2011 (MCTIC and OECDstat, ppp). As a result, Brazilian productivity – although still higher than the Chinese productivity – is losing ground fast. In 2009, Chinese productivity was US$ 14.7 thousand per person engaged, and in 2014 it reached US$ 21.5 thousand, an increase of 32%. On the other hand, Brazilian productivity was US$ 26.5 thousand in 2010 and US$ 29 thousand in 2014, an increase of just 18%. Through the gathering and analysis of many papers, reports and gray literature from academics, policy analysts and technicians we were able to identify seven major actions to deal with this low input-output relation and to foster innovation in Brazil.

FINANCING INNOVATION IN BRAZIL: THE ROLE OF THE BRAZILIAN DEVELOPMENT BANK

International Journal of Innovation, 2019

This paper presents the role of the National Development Bank (BNDES), the main public development agency in Brazil, in financing technological innovation. The scarcity of financing for innovation has always been considered as a limiters to Brazilian technological development. And, given the characteristics of the innovative process, public funding plays a central role. Therefore, understanding the evolution of the role of the BNDES-one of the largest development banks in the world-in stimulating innovation is essential. Firstly, it presents a historical description of the Bank's activities, followed by a brief description of the measures to support innovation in Brazil over the last two decades. In the third section we discuss the evolution of BNDES as a financing agent for technological development, including the instruments offered by the institution and their reformulations over time. In the fourth section, the profile of innovation expenditures carried out by BNDES, according to their origin (instruments used) and destination (sectors and profile of companies supported), is evaluated. Finally, the fifth section presents the final considerations. The differential of this article is to detail, for the first time, the participation of this relevant Brazilian institution in financing innovation. The analysis has an institutional approach: it does not present an impact analysis, but it allows the reader to understand the changes in the instruments and in the priorities that the institution has assumed in the last decades. This analysis is essential to understand the logic and evolution of the country's largest development institution.

Climbing to the Top? Reorganising Global Value Chains and Building Innovation Capabilities in Brazil and India

SSRN Electronic Journal, 2000

This paper is concerned with global shifts in innovation power. It shows that Brazil and India are accumulating significant innovation capabilities. Most explanations concentrate on factors within these rising powers. This paper concentrates on explanatory factors which have their origin in the old powers (Europe and USA). In order to understand the build-up of innovation capabilities in the new powers it examines their linkages with the old powers, concentrating on the value chains which connect them. It shows how the organisational decomposition of the innovation process emanating from the old powers contributes directly and indirectly to the build-up of innovation capabilities in the new powers. It is clear that a new dynamic has been unleashed but it is not yet clear whether the old powers are contributing to their own demise or renewal. The empirical evidence comes from the Brazilian auto and the Indian software industry and the value chains which link them to the United States and Germany.