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High Growth Initiatives in Denmark

High Growth Initiatives in Denmark. Thomas Blomgren-Hansen. A few figures on Danish HGIEs. Only 1 % of start-ups 2003 were high growth companies in 2008 Number of high growth start-ups has fallen fra 300+ before the crisis to app . 200

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High Growth Initiatives in Denmark

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  1. High Growth Initiatives in Denmark Thomas Blomgren-Hansen

  2. A fewfigures on Danish HGIEs Presentation title – Insert by clicking Insert>Header & Footer • Only 1 % of start-ups 2003 werehighgrowthcompanies in 2008 • Number of highgrowth start-ups has fallen fra 300+ before the crisis to app. 200 • Only 8 Danish companiesestablishedwithin the past 30 years have passedeither 1000 employees or top 100 turnover

  3. Danish initiatives with specific growth focus Presentation title – Insert by clicking Insert>Header & Footer • Gazelle programme (ended 2010) • Advice and funding for young growth companies. • MIT inspired. Hand pick companies, make them grow to 250+ employees • Accellerace (started 2008) • Advice and funding for small innovative companies • Train and learn entrepreneurship • Growth fund • Seed and venture capital for growth companies • Innovation incubators • Seed pre-seed capital for young innovative companies

  4. Why so fewinitiatives Presentation title – Insert by clicking Insert>Header & Footer Somescepticismabout the effectiveness of ourefforts Existence of HGIEsdoesn’tneccessarilymake support easy and effective: • How to support succesful enterprises? • Why support companieswhich have alreadyproven succesful? • Heterogeneousgroup of companies • Exist in all sectors and not necessarilyyoung (70% more than 5 years) • Unstable and unprdictablegrowth • Almostunheardthat a companyappear as HGIE threeyearsrunning • FindingHGIEs ex-ante • No commoncharacteristicsmakesthemdifficult to spot and target

  5. Ourownexperience Presentation title – Insert by clicking Insert>Header & Footer HGIEsdon’tcome from university spin-outs • 18 new spin-outs in 2012 and total ownership in 49 companies • Total income from spin-outs EUR 12 mill. 73 % from one spin-out • Protection of IPR cost EUR 4,5 mill. Gazelle growth did not reachgoal • Expected 75% of participatorswouldincreaseemployment by 20% a year over 3 years • 27% met the goal, additionally 10% reached the range 13-20%

  6. Ourownexperience Presentation title – Insert by clicking Insert>Header & Footer Poor succes from seed capital (Innovation incubators) • Pure financialreturn -80% • Lowersurvival rate than match (Not significant) • Lowerturnoverthan match (Not significant) • Lower Value addedthan match (Not significant) • Not signicantlydifferent from match despitelesssustainablewithout the incubators • Othereffects?

  7. Ourownexperience Presentation title – Insert by clicking Insert>Header & Footer Limited success from Accellerace (since 2008) • Providedadvice and funding for 200 companies • 400 new jobs • Raised EUR 72 mill. (incl. statefunding EUR app. 15 mill) • Impressivesurvival rate of 94% Danish Growth Fund (since 1992) • ProvidedEUR 0.3 Bninvestment2000-2013 (Direct) • 3,600 jobs created and GDP increase EUR 0.3 Bnincl. effects from involvement in venture funds (EUR 0,35 Bn) • Societaleffect over a 3 yearperiod: • 1,1 mill. GDP increase pr. mill. directlyinvested • 14 new jobs pr. mill. invested

  8. Conclusions Presentation title – Insert by clicking Insert>Header & Footer • Acting on verylimitedknowledge • Unpredictableand unstablegroup • Unclearwhethertargetedinitiativesaresuperior to a general improvement of the frameworkcompanies

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