Callaghan Innovation’s business case came out a week before Christmas among a flurry of keep it under the radar government documents released about the same time.
(Ironically, the business case appeared a couple of hours after sticK commented that it hadn’t turned up…though I’m not claiming any credit!).
As a some people commented, it wasn’t much different from CI’s Statement of Intent delivered in late July.
But, delving among the entrails is the first new, rather than inherited, scheme put up by the Crown Agency.
A repayable grants programme. (As described in their own words on page nine of the document it is):
Repayable Grants Programme: provides grants to technology-focused incubators in order to create and nurture new businesses based on promising areas of technology. This new programme will ramp up to providing 24 grants annually of $450,000. These grants must be repaid once the new businesses begin generating revenues.
Now there’s not much flesh or other information around this RPG, but what it essentially is, is a repayable loan if and when a fledgling company starts making money.
Israel (among a number of exemplar countries) has had this model for a number of years, as mentioned in the fourth paragraph of a guest blog by Daniel Saunders in VCCafe.
From what I gather, the main advantage of such a repayable loan is it recognises that many technology focused ventures are risky; a punt.
That being the fact, if they succeed, the money’s paid back. If not, ‘deems da breaks’.
It is also relatively simple to administer – and much less influenced by a bureaucrat’s whim (apparently).
So, a bit of a thumbs up for Callaghan Innovation…some innovation of its own.
We’ll look forward to seeing how the RGP is going to work in actuality, as Callaghan Innovation works towards its stated ideal of being a small R and big D in New Zealand’s R&D (research and development) landscape.