Alignment of sustainable public policy with the interests of the Smart Money

- Legacies of the Global Crisis

A. Mete ÇAKMAKCITechnology Development Foundation of Turkey

9th International Entrepreneurship Forumİstanbul, 18 September 2009

An Engineer’s View of the Crisis

Panic Despair & Confusion A Confident Vision

DisgustRegulationRestructuringReform

Smart Choices & PoliciesRejection of old ways…

An Account of the Past Realities of Today A Sustainable Future

towards a New World Order of Peace and Prosperity

Emotions are running high…

We feel the pain

• Contracted demand for goods and services, swollen inventories.

• Increased payment delays• Shortage of working capital, decreased liquidity• Increased insolvencies and bankruptcies• Reduced demand for credit to finance• Tightened lending conditions and increased cost of finance

Rush to government ‘rescue’ programs is causing reflexes and funding problems – crowding out of routine innovations?

Fighting the Reflexes

• Government intervention should target long term capital investments (including intellectual capital) to promote innovation, should avoid urges of ‘cheap populist financing’. (respect competitive market powers and innovation cycles)

• Consumption and trade should be integrated to support the long term investments, should avoid ‘hay flame’ type of consumerism.

• Growth should be designed to be sustainable and organic. (must avoid past models of growth on steroids.)

Putting Public Money to WorkGovernments are talking …

Smart money is listening …

What is Cleantech?

Source : GreenTech Media

Cleantech is a rich but complex innovation domain …

Cleantech is still Fragile

Source : McKinsey

And cleantech is still away from market parity.

VC for Cleantech

Source : Cleantech Group

In 2008 China’s share of global cleantech investments was 8%.

Moving Away from Knowledge

A Vision for Public Policy• Global crisis must provoke a new thinking of public policy.

• There is still need for a strong public policy vision, however the new vision should support and yield initiative to `smart money`.

• New statism should involve interim and flexibly adopting government roles to provoke sustainable commercial ecosystems of innovation.

• We need to think beyond direct financial measures into policy infrastructures such as in public procurement, taxation and market deregulation in support of young innovative companies with new business models.

Who is TTGV?

TTGVA foundation

TTGVA foundation

Teknoloji Yatırım A.Ş.A dedicated start-up investment vehicle

managed by an independent team

Teknoloji Yatırım A.Ş.A dedicated start-up investment vehicle

managed by an independent team

TURKVEN - TPEF 1TURKVEN - TPEF 1

İŞ GirişimİŞ Girişim

iVCiIstanbul Venture Capital InitiativeA dedicated Fund-of-funds SIF structure

for VC/PE funds focusing on Turkey managed by the EIF

iVCiIstanbul Venture Capital InitiativeA dedicated Fund-of-funds SIF structure

for VC/PE funds focusing on Turkey managed by the EIF

TDF A soft loan scheme upto 1 M USD per project

almost 250 M USD disbursed since 1991

TDF A soft loan scheme upto 1 M USD per project

almost 250 M USD disbursed since 1991

ShareholderShareholder

InvestorInvestor

InvestorInvestor

ShareholderShareholder

Administrator/Administrator/Co-lenderCo-lender

Regional and Sectoral Capacity Development Programs

Social Capital, Clustering, RIS

Regional and Sectoral Capacity Development Programs

Social Capital, Clustering, RIS

FacilitatorFacilitator