Presentation to Royal Society of

New Zealand

Peter Benfell23 June 2004

Crown Entity

Current investments $465m p.a.

75 staff

Objective:

“Invest in innovation for NZ’s future”

- economic, environmental, social- also knowledge (underpinning)

What is the Foundation?

Investment Funds 2004/05

New Economy Research Fund15.1%

Research for Industry40.4%

Environmental Research20.3%

Consortia3.7%

Pre-seed Fund1.0%

Technology NZ8.7%

Supporting Promising Individuals

1.6%

Non-Specific Output Funding7.0%

Social Research1.4%

Maori Knowledge & Development Research

0.6%

International Investment Opportunities Fund

0.3%Public Good Science & Technology $m New Economy Research Fund 70.4 Research for Industry 187.8 Environmental Research 94.4 Social Research 6.6 Maori Knowledge & Development Research 2.7 Non-Specific Output Funding 32.4 Research Consortia 17.1 411.4 Other Funds Pre-seed Fund 4.8 Technology NZ 40.4 Supporting Promising Individuals 7.4 International Investment Opportunities Fund 1.4 Total 465.4

19 Portfolios

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

50000

SEG INF MAN NBP NSU PQA RIC SPS SER PRU RPM FHT NPT NZT GLO ECO SCS SRU BIS

Portfolio

$ 20

03/0

4 ($

000'

s)

RFI MKDOC NERF ENV SOC

SEG Sustainable Economic Growth RPM Rangahau Putaiao Maori

INF Innovative Foods FHT Future Human Technologies

MAN Manufacturing Processes, Products & Materials NPT New Physical Technologies

NBP Niche Biological Products & Services NZT Technologies to Leverage NZ’s Strengths

NSU Networks, Structures & Utilities GLO Global Environmental & Earth Processes Change

PQA Primary Production, Quality & Assurance ECO Resilient, Functioning and Restored Natural Ecosystems

RIC Resilient Infrastructure & communities SCS Building Sustainable Cities & Settlements

SPS Sustainable Productive Systems SRU Maintaining Environmental Integrity for Sustainable Resource Use

SER Building Knowledge-Intensive Service Industries BIS Building an Inclusive Society

PRU Optimising Use of Physical Resources    

New Economy Research Fund

$0

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

$35,000,000

$40,000,000

$45,000,000

$ Amount

2002 $1,426,611 $36,250,970 $15,328,662 $4,337,544 $473,134

2003 $374,031 $41,856,658 $18,099,461 $4,088,672 $315,250

Basic Untargetted Basic Targetted AppliedExperimental Development

Product Development

Research for Industry

$0

$10,000,000

$20,000,000

$30,000,000

$40,000,000

$50,000,000

$60,000,000

$70,000,000

$80,000,000

$90,000,000

$100,000,000

$ Amount

2002 $3,328,658 $75,697,080 $65,254,560 $21,985,353 $7,055,074

2003 $1,034,300 $66,538,255 $93,224,757 $17,395,935 $4,143,371

Basic Untargetted Basic Targetted AppliedExperimental Development

Product Development

Range of Providers

AgResearch

NIWA

IRL

HortResearch

LandcareResearchCrop & Food

ForestResearch

GNS

ESR

Other Universities

University of Auckland

Research Associations

Private (incl Consortia)

New Zealand investment in R&D

NZ investment 2002 - $1.42B

• 1.13% of GDP

Private sector - $524M

• 0.42% of GDP

OECD average business investment in R&D• 1.5% of GDP

Challenge

How to get the same outcomes from predominantly public funded R&D system that other countries achieve from a predominantly private funded one!

(across economic, environmental and social objectives)

“FRST must improve its measurable returns to NZ from its investments”

Why?

• future Government investment in science

- make it easy for the politicians

• increase private sector and international investment

• be able to better reward our scientists

- retention

- attraction

Co-funding of our investments

Seek co-investment in all types of funds

Technology NZ

New initiatives•Research consortia•Pre-seed•Outcome-based investments•International Investment Opportunities Fund

Co-funding of our research investments

$0

$50,000,000

$100,000,000

$150,000,000

$200,000,000

$250,000,000

$300,000,000

$350,000,000

$400,000,000

2002/03 2003/04

Total $ Allocation Cofunding $ (Direct and Related)

Research Consortia

User-led joint ventures

Leveraging new funding from private sector

Foundation funds up to 50%

Seven established with another 6 likely in next 12 months

• Private sector investment - $25m pa

New fund of $5m per annum

Foundation invests in public sector research organisations to assist projects through

“valley of death”

To get projects more ready for private investment and further commercialisation

Pre-seed Fund

Technology NZ

Invest in private sector companies to enhance technological capability

Usually 50/50 co-funding

Foundation investment of $50m pa

Outcome focused

Longer term, 6-12 years

Providers determine the projects

User engagement and commitment

Performance monitored

To be piloted in Ecosystems portfolio

Outcome based investments

New fund, $3m in 2004/05, then $4m, $5m

Enable NZ researchers to respond to international collaboration opportunities arising out-of-cycle

Assist top researchers to re-locate to NZ

International Investment Opportunities fund