Dupont Innovation Debate November 17th 2014

December 1, 2014

We were privileged on Nov 17th to co-organize a debate around sources of innovation and whether corporates would be driving them…or not!

 

“Will multi-nationals drive innovation? Or do we need to look elsewhere?”

 

Considering the complexity of the topic and the number of stakeholders involved in the innovation ecosystem, we did not expect complete answers, however, leading representatives from the ecosystem joined us at the offices of DuPont in Geneva to share their opinions on the subject and to help shape our opinions. Our panel was joined by over 60 participants, representing large corporations (48%), investors (13%) and entrepreneurs (39%).

To secure an understanding of the audience’s perspectives, we conducted a pre-event survey about:

1.      the role of the government in stimulating innovation;

2.      the engagement of large corporations towards start-up companies; and

3.      the performance of Swiss Start-Ups.

 

The survey suggested that:

  • while the audience saw the role of government as being best if limited, whether for applied research or ‘go-to-market’ activities, the levying of capital gain taxes to finance research was felt to be a good measure by almost 50% of the respondents;

  • while the audience (> 70%) felt that the Swiss innovation scene is healthy, over 35 % felt that start-ups in CH are just not good enough; and

  • while the audience (>65%) believed that corporates are the pioneers of innovation, >75% felt that governments should incentivize them to support start-ups.

With these perspectives in mind, the debate commenced...we had the privilege of some leading speakers representing corporate interests, the start-up scene and the political world:

 

Corporate Strategic Investor (KLM):                                    Ignace Caryn

DuPont N&H Global Technology Director:                          Nicolas Cudre-Mauroux

Swiss Politician and Innovation Champion:                         Fathi Derder

Serial Entrepreneur:                                                             Jack Barbut, CEO Novimmune

 

Major takeaways from the debate were:

  • Corporates vary in their preference as to whether they have a direct/internal collaboration with start-ups or whether they establish their collaboration/venturing activity via a separate and independent unit.

  • All corporates emphasize the need for a strategic fit with a start-up in addition to the prospect of a financial advantage, although they vary in the extent of their pro-activity, their appetite for portfolio approaches and their appetite for particular technology innovation life cycles.

  • Overall, it was felt that there is a clear role for Governments to get involved in the process - in particular, in de-risking prospective start-ups and allowing the corporates/investors to get involved at an earlier stage.

  • Perceptions shared by the speakers included: although Switzerland has a higher salary cost of >40%, it stays competitive through a high availability of experts, flexible labour laws etc; there is a clear issue in managing innovation as too many projects are being funded yet the most promising ones are still not sufficiently funded; and failure is not readily accepted, with ‘poor’ projects not being terminated early enough.

  • It was felt that the US is clearly better than Europe at later stage funding but that, while Switzerland is not yet recognized as a start-up nation, ‘Swiss Start-Up nation’, initiated by Fathi Derder, goes a long way to addressing this gap, by promoting a culture of Entrepreneurialism and promoting ‘sweat capital’ in Switzerland.

  • Other points discussed included comparing “Bottom Up” innovation (ie non-government R&D strategy) with “Top Down” (e.g. the response to Ebola) and the mission of universities being adapted to include the creation of companies.

As expected, the topic is both broad and complex but the interactions, insights gathered and enthusiasm generated during and after the debate indicated that the topic is well worth further investigation.

The speakers were able to assess the impact of their opinions on the audience…after the debate:

  • even more people (90% cf 65%) were convinced that corporates are the pioneers of innovation;

  • even more participants believed that Swiss start-ups just aren’t good enough (45% compared to 35% beforehand); and

  • most strikingly, > 95% believed that government should take at least some role in taking technologies to market, cf 68% in advance.

The initial mission was accomplished but this is definitely a subject to be continued…

 

Posted by Alexandre Grutman & Colin Turner

 

 

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