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do your R&D in Austria

Thursday 12 May, 2011

ABA-Invest in Austria, the Office of Science & Technology (OST) at the Austrian Embassy, & Austrian consulate in Chicago hosted this event Start Your R&D Business in Austria featuring Markus Costabiei of tech 2 B incubator, Michael Moll of Entrance Entrepreneurship & Finance , and Alexander Krajete of Green Energy Think Tank. Here is the presentation AustrianR&D they made.  I’ll summarize what they said that’s not included in the presentation.

Hans Nagel of ABA opened by pointing out that German is the largest homogeneous language spoken in Europe by 100M people, of which Austria is included, while Vienna is so diverse that 25% of it’s population doesn’t speak German as their mother tongue.  Philipp Marxgut of OST indicated that Austria intends to increase it’s investment in R&D to 3.25% of GDP to become an innovation leader.

Michael Moll provided the details of funding sources in Austria, the government for grants & soft loans, & the Austrian Promotion Bank & Research Promotion Agency which offer grants & soft loans of up to €100K without any liabilities.

Alex Krajete was able to raise €400K to convert CO2 into natural gas.  He got the idea from Chemical Engineering News in 2007.  His concept mirrors the origins of life, starting with microbes, & organisms, etc.   He wrote a 10 page business plan which got him €100K in June, 2009.

Markus Costabiei discussed Austrian incubators & his in particular.  His program started in 2001 to support start-ups using a balanced scorecard model.  They’ve done 1000 projects which has resulted in 400 companies starting-up which have won 200 prizes.  Markus noted that while A.Krajete knew his technology well, he was lacking business knowledge, so they worked together to build this human capital to seek financial capital.  They now meet every 4 months to update & review the technology & business.

A couple of attendees were from Baxter Labs, which is big in Vienna.  Baxter acquired Immuno 15 years ago in Austria & it shifted the direction of the company.  They now have more than doubled the number of researchers from 500 to 1200 in Austria so that 80% of their R&D people are there.  Austria’s asset is it’s people & their talent, which leads to an excellent R&D environment.  The country offers premier living conditions which makes it easy to attract talent.  They also mentioned that any innovation involves risk, & that most scientists are lousy business people.

Q&A

  • The tech 2 B program gets 40 applications/year & ~9 are accepted, depending on budget availability.
  • Legal issues all come down to intellectual property, (IP), which is different from other kinds of law because entrepreneurship requires IP that is new.  You have to get the right patent, but finding capable lawyers can be difficult.  It took some time to find someone qualified in München.
  • Krajete originally thought his customers would be the power companies, but they were too focused on using their existing resources, so actual communities seem to be his clientele.  A major issue is enabling the long-term storage of energy.
  • A qualified project must do R&D in Austria.  Selection criteria should be discussed on a project-by-project basis.
  • Krajete’s business model depends on taxation & the pricing of energy per kilowatt hour.
  • The # of angel investors with € & experience is growing.
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