Investing in Innovation Presentation to CAURA East 2013

1. Investing in Innovation Presentation to CAURA East 2013

2. ABOUT ACOA A federal government agency headquartered in Atlantic Canada. Goal is to improve the economy of Atlantic Canadian communities through the successful development of business and job opportunities. Offices across Atlantic Canada.

3. C Regional Presence ACOA ECBC

4. ACOA’s Support to Innovation Two principal programs: • Atlantic Innovation Fund: • Supports private sector projects between $1-3M and non commercial projects below $3M • Annual expenditures approx. $40-50 million • Business Development Program (Innovation Component): • Supports smaller projects (under $1M); • Annual expenditures approx. $35 million • ACOA programs aim to strengthen/encourage innovation by supporting activities like R&D, technology acquisition, commercialization, etc.

5. AIF Objectives • Increase activity in, and build capacity for, innovation and research and development (R&D) that lead to new technologies, products, processes or services • Increase R&D commercialization • Strengthen regional innovation capacity by supporting partnerships and alliances between private sector and universities/research institutions • Maximize benefits from the national R&D programs

6. AIF Commitments by Region

7. AIF Commitments by Sector

8. Examples Wabush Mines, Cliffs Natural Resources Manganese Separation Wabush Mines assessed and evaluated a manganese separation technology on a production prototype to determine whether the technology could be transferred to a full facility rollout. The company’s R&D was successful in reducing the manganese content of its iron ore deposits to acceptable levels, increasing the remaining life of the mine by approximately 20 years.

9. Examples LED Roadway Lighting Ltd. Amherst-based LED Roadway Lighting Ltd. is hoping to light up neighborhoods around the world with its new LED streetlight technology. The eco-efficient light market is quickly expanding, bringing with it big savings for municipalities and businesses.

10. Examples Ocean Nutrition Canada Ltd From Fish Oil to Functional Foods A growing recognition of the health benefits of fish oils and good old fashioned research has turned a once tiny business into the world’s leading supplier of marine-based dietary supplements and bulk nutraceutical ingredients. After company researchers discovered a breakthrough technology that transformed fish oil into a fine powder, ONC opened its first micro-encapsulation plant in 2001 and now sell products all over the world. ONC was purchased in 2012 by DSM for $540 M.

11. Examples MDS Coating Technologies Corporation Fighting off Erotion Helicopters and other aircrafts operating in conditions of sand, dirt and volcanic ash are continuously exposed to a silent form of attack – erosion of their engines by a harsh environment. MDS Coating Technologies Corporation in Summerside, PEI, have developed a number of special protective coatings which guard against erosion and corrosion of aircraft engines. These erosion resistant coatings are designed specifically for the protection of gas turbine engine compressors and can extend the engine life by up to 10 times, avoiding expensive repairs, reduced performance, increased fuel burn and unscheduled down time for the aircraft.

12. AIF Results to Date • Fostering private sector commitment in S&T: Close to 760 partnerships created; private sector participation continues to be significant; and the percentage of institutional projects with a private sector partner has increased (100% in more recent rounds). • Leveraging investments: Almost $850 million leveraged from private sector, universities, research institutes, and other government programs. • Magnet for talent: New scientists and researchers are being attracted to Atlantic Canada – 1250 HQPs. • Getting to Market: More than 250 technologies, products, processes and services developed through the AIF have been successfully commercialized, resulting in just under $250 million in incremental sales (AIF Rounds I-IV). • Strengthening the Knowledge Base: AIF investments align with national S&T priorities (e.g. Advantage Canada and Canada’s S&T Strategy) and regional priority sectors (e.g. Bio, Health, ICT, Energy, Oceans).

13. Testimonial

14. Testimonial

15. Ideal AIF Project • Good economic return and benefits • Innovative R&D • Strong Technical Expertise • Proven Management • Good Financial Structure (e.g. leveraging) • Strong Commercialization Potential • Meaningful Partnerships/Collaborators • Contracted within 4-6 months of approval • Draws on Expertise of Universities, Research Centres and Private Sector

16. Common AIF Pitfalls • Research too early stage (basic) • Commercialization strategy or path to commercialization not well defined • Unclear definition of end products and/or market relevance • Lack of supporting market research • Lack of understanding and/or details on competitive products and markets • Lack of experience in commercializing research results • Lack of confirmed financing • Lack of cash contribution/demonstration of commitment, “cash is king” • Percentage of AIF contribution requested too high, lack of leveraging • Lack of evidence of strong, meaningful partnerships “cash is king” • Lack of scientific and technical detail in a proposal

17. For More Information • For more information on ACOA and its innovation programming, please consult the Agency’s web site: www.acoa-apeca.gc.ca