SMALL BUSINESSES

The resources for innovation are increased

FAPESP increases by 50% the financial limit of PIPE

Many new ideas marked the publicizing of the seventh edict of the Small Business  Innovation Research (PIPE) of  FAPESP, in the month of May. The most important was the increase by 50% in the financing limits, in comparison with the last six edicts. Now, during the first phase, a company may receive up to R$75,000 (before the limit was R$50,000) for the elaboration of the research of the technical viability of the project. In the second phase, when the project is effectively developed, the cap has increased to R$ 300,000 (against R$200,000 before), available over a period of two years.

Another change refers to the demand  of a Business Plan which should be drawn up by the company, showing the paths of economic viability of the results of the research. It will be a report with the details of the market to be hit by the product or system and the possible forms of commercialization. To elaborate this document, the companies can count upon the orientation of the Brazilian Service of Support to Micro and Small Businesses (Sebrae) of São Paulo, according to an agreement between that organ and FAPESP.

As from the seventh edict, there also came into play the possibility of the technician responsible –  also called the research coordinator –  asking for a scholarship from FAPESP, assuming that he does not belong to the workforce of the company nor is  he one of the partners.

The PIPE looks at research projects – with content of technological innovation – of businesses based in the state of São Paulo with, at the maximum, 100 of a workforce. The program received, up until the sixth edict, 330 registrations, until the end of May, 110 of which were approved for the first phase, being that 44 were also in the second phase.

Total resources
In the businesses with projects approved are representatives of 29 São Paulo cities. The Capital leads with 31 projects, followed by Campinas with 22, São José dos Campos with 19, and São Carlos with 9. Summing together the projects of the first and second phases, FAPESP invested R$ 8.6 million and US$2.4 million since the end of 1997. For this year, a total investment of US$10 million is programmed for PIPE.

The increase of the ceiling of the investments is one way to broaden the participation of the Foundation in the business world. “This decision aims to give more opportunity to more expensive projects. We don’t want to lose good front line technology projects which, normally, are those which require greater investment “, explains  professor Francisco Antônio Bezerra Coutinho, Assistant Coordinator in the area of exact sciences  at FAPESP. The financing is used by the company in the purchase of equipment, supplies and in third party services, including consulting.

“The increase of the allocation reflects the success of PIPE, which has turned more ambitious and more courageous. We want to attract more companies with potential to develop technology”, says José Fernando Perez, Scientific Director of the Foundation. “We are following what the largest development agency in the United States, the National Science Foundation (NSF), did just over a year ago, increasing by 100% the support of small businesses.” In that country, one approved project in the first stage receives a value up to US$ 100,000 and in the second, up to US$ 400,000. “If the NSF did this, it is because innovative technology in small businesses has, like here, to be stimulated”, says Perez.  “We want to contribute to better perception of the importance of the incorporation of technical know how into a product.”

One of the intentions of PIPE is just that, to enlarge the frontier of research beyond the academic world. The world trend is to concentrate the major part of scientific and technological investigations in business settings. “In this way, the subsidy that we provide through PIPE is totally acceptable, including from the point of view of the World Trade Organization”, analyzes Perez. The WTO, once in a while, creates some fuss about  subsidies given by various governments, claiming that this takes away the competitively of the market.

Another aspect of PIPE is to create space in companies for researchers in all areas. Although , it not demanded the presence of professionals  from academia to run a project, it is possible the involvement of retired researchers,  recent graduates or those on sabbatical leave, taking into consideration the minimum dedication of 20 hours per week for the execution of their duties.

Semestral budgets
The researcher responsible must look after the technical preparation of the application to the Foundation, to follow up all the execution of the work and to make the technical, partial and final reports of the project. As from the date of this edict, as well as the annual reports, the companies will have to present synthesized reports and semestral budgets of expenses. With this measure, the company will establish goals over a phase of six months coupled to the expenses which will be necessary during this period. The company will only receive the financing for the next phase if it demonstrates to have spent what was agreed on during the previous semester.

The seventh edict set a time limit for the entry of proposals as the 30th of June. The publication occurred in May in 2 newspapers in the state of São Paulo, covering daily newspapers of the city of São Paulo, the ABC  region (Industrial suburbs around São Paulo, Bauru, Campinas, São José dos Campos, São José do Rio Preto, Araraquara, Ribeirão Preto and São Carlos.

Within the future novelties of PIPE, as yet under study, is the possibility of the financing of phase 3, when the product enters onto the production line. “We are concerned in making the projects very successful. To this end, we are studying the creation, with other entities and organs of financing, of specific funds to implement the manufacturing of products developed within PIPE”, informs  Perez.

Evaluation of the project

“The fundamental thing for a project is that it  should contain a good idea and a correct presentation, demonstrating that the coordinator and the main researcher know how to carry out the work”, states professor Coutinho. This principle is what must guide an analysis before handing in a request to FAPESP. Nevertheless, the methodology of analysis of projects obeys the same parameters as the scholarships and the other diverse programs of the Foundation. The project is moving forward and, at the minimum, with two external advisors,  in the case of PIPE (see story on page 16) for the analysis of content and viability.

The assessors, in the evaluation of the project, pay particular attention to the following items:

• Objectives: well defined and compatible with the proposed time.
• Methodology: well written and adequate for the objectives proposed.
• Innovative technology: it will produce an innovation with a commercial or social impact.
• Previous competence and experience of the researcher and team: if it is sufficient to guarantee a high viability of the project.
• Capacity of the company to develop or negotiate the current innovation of the project.
• Justification of the budget presented.