Governments around the world spend huge amounts on research and innovation. The vast proportion of this takes the form of financial support for innovation projects and activities, through mechanisms such as grants, loans, investments, inducement prizes and service contracts.

We know that financing is crucial for anyone who wants to get a good idea off the ground, and drawing on our experience as an innovation funder, Nesta has recently produced a practice guide sharing insights and recommendations on how to use different forms of funding to support innovators more effectively. But it takes more than money to turn great ideas for new products, services or business models that meet economic and societal needs, into sustainable enterprises.

Innovators require other forms of support to develop the resilience, skills, capabilities and networks that will enable them to use this funding effectively. However, we still don’t know enough about what kind of support makes the most difference to innovators at which points, and the best way to design and deliver these types of services.

These are questions that Nesta has been exploring over the last year in partnership with ANI Portugal, through a taskforce for the TAFTIE network of European innovation agencies. This builds on Nesta’s earlier research on how innovation agencies work, which compared the approach, evolution, and impact of a range of government-funded or managed bodies around the world that aim to stimulate private sector innovation.

It also taps into a growing trend we have observed in recent years - a shift towards providing more bottom-up innovation support that starts with what the innovator needs, rather than what the provider has to offer. In June 2018, European Commissioner for Research, Science and Innovation, Carlos Moedas, acknowledged that the Commission’s current approach to innovation funding isn’t working as well as it could, and signalled a clear intention to be more led by what entrepreneurs are asking for:

In order to provide this kind of tailored support, innovation agencies need to have a good understanding of the services that will most usefully complement the financial assistance that they give to innovators, a clear mandate to provide these services, and the right skills and resources to deliver them. So, how far are agencies along this journey?

What we’ve learned so far

To find out more about the range of non-financial advisory and support services currently being offered by innovation agencies across Europe and beyond, we carried out a survey of the TAFTIE network’s member agencies in 2018, complemented by qualitative interviews and a set of three discussion workshops in Portugal, Luxembourg, and Slovenia. With data on 24 different agencies*, we now have a much better picture of the current state of play. Here are three of our key takeaways from the research:

• Innovation agencies are keen matchmakers. The most common types of services offered involve helping innovators get the information and build the connections that they need to develop their ideas. Almost all of our surveyed agencies provide information (for example about funding or investment opportunities), and offer matchmaking and brokerage services. The majority also provide coaching and mentoring services, and offer different forms of advisory support (for example, around proposal-writing, legal issues or business management). International matchmaking is also a theme, with more than half of the agencies in our survey offering some combination of support for international collaborative research and innovation, overseas missions, and trade and export activities.

• Effectively tailoring advisory and support services is a common priority, and a common challenge, for innovation agencies. For a selected group of agencies, non-financial support is a critical part of their offer. Services such as coaching, mentoring and other forms of advisory support are embedded across their programmes, and the ambition is to make these services as tailored as possible to the needs of innovators. Other agencies find it more challenging to operate in this way, often because the funding for these services comes from external rather than internal resources (such as European structural funds) and therefore cannot be used so responsively. Being flexible and adapting to innovators’ needs as they arise can also bump up against the need to fix programme budgets and available resources well in advance. Despite these difficulties, we observed a widespread desire across all agencies to develop services that are more ‘one-to one’, rather than ‘one-to-many’.

• There is a lack of good evidence on the value of non-financial support. Few of the agencies we surveyed were able to give a precise figure for the budget allocated to advisory and support services, and less than half formally evaluate their impact. However, there was a strong consensus from interviews and workshop discussions that these services are a valuable and necessary part of their overall offer to innovators, and that more effort should be put into evidencing this both qualitatively and quantitatively. Without this, there is a risk that support services might be cut or deprioritised.

Next steps

Our research has given us some great examples of practice across many different innovation agencies. We’ll be profiling these in follow up blogs, along with some comparative case studies from other agencies internationally. We’ll also be sharing further details of our analysis, and offering ideas on how innovation agencies can build services that are tailored to the needs of the innovators they serve, and learn from others who are already providing services in this way.

This work has raised other interesting questions for exploration. Moving forward, we want to develop our thinking on how innovation agencies can be more experimental in their approach to providing advisory and support services (drawing on the work of our colleagues at the Innovation Growth Lab). We’ve collected valuable data on the backgrounds and expertise of the people who work in innovation agencies, and would like to map this more clearly on to the future skills and capabilities that will be required to keep them at the cutting edge of innovation support provision. We also want to develop better ways of understanding and valuing the impact of the non-financial support that innovation agencies provide, to help them be more strategic in where they focus their attention and their resources in the future.

We’d love to hear from others who are thinking about these questions, and from innovation agencies with useful experiences to share. Please do get in touch by e-mail at: [email protected]

* The innovation agencies included in our study are: ANI (Portugal); Bpifrance (France); Business Finland; CDTI (Spain); ENEA (Italy); Enterprise Estonia; Enterprise Ireland; FFG (Austria); VLAIO (Belgium); Hamag-Bicro (Croatia); Innosuisse (Switzerland); Innovate UK; Innovation Fund Serbia; Innovation Norway; ISERD Israel; Luxinnovation (Luxembourg); MITA (Lithuania); NKFIH (Hungary); RVO (Netherlands); PtJ Juelich (Germany); SPIRIT Slovenia; TACR (Czech Republic); TTGV (Turkey); and Vinnova (Sweden)