STUDY Brazilian Innovation Ecosystem - Enrich in LAC
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STUDY
Brazilian Innovation Ecosystem
Study elaborated under CEBRABIC Project
Author: Confap, Paulo Egler and Elisa Natola
Status: December 2020
1
Table of Content
I. Introduction ...................................................................................................................... 3
II. Governmental Funding Agencies ..................................................................................... 4
Banco Nacional de Desenvolvimento Econômico e Social – BNDES (National Bank for
Economic and Social Development) ...................................................................................... 4
Financiadora de Estudos e Projetos - Finep .......................................................................... 7
Conselho Nacional de Desenvolvimento Científico e Tecnológico – CNPq......................... 11
Empresa Brasileira de Pesquisa e Inovação Industrial - Embrapii....................................... 14
Agência Brasileira de Desenvolvimento Industrial – ABDI .................................................. 17
Brazilian National Council of State Funding Agencies - CONFAP ........................................ 17
III. Interaction environments for academy-business-entrepreneurs............................. 20
Nuclei of Technological Innovation (NITs) .......................................................................... 22
Technology-based Incubators ............................................................................................. 25
Accelerators ........................................................................................................................ 28
Technological Parks ............................................................................................................. 31
IV. Venture capital, angel investment and investment cycles ....................................... 35
Private investment and innovative entrepreneurship ........................................................ 35
The situation of investment in innovative companies in Brazil .......................................... 35
The potential of Brazil's innovative investment .................................................................. 38
V. Regulatory and legal barriers to the investment and development of startups in Brazil
40
Regulatory barriers to the development of startups .......................................................... 41
Institute for "disregarding legal personality" and investor accountability ......................... 49
Recent Regulatory Procedures to Startups ......................................................................... 52
Regulatory agencies and others regulatory institutions ..................................................... 53
VI. Brazilian Enterprise Europe Network (EEN) - New Consortium ................................ 56
VII. References .................................................................................................................. 58
2
I. Introduction
Brazil is not an easy country when considering the financial, legal, institutional, and political
environments regarding the establishment, and implementation of businesses.
As one of the institutional functions of Enrich is facilitate European enterprises that want to
move to Brasil, and Brazilian enterprises that want to move to Europe, an important contribution
of Enrich is to make Brazilian institutional and legal environments knowledgeable and
understandable to European enterprises.
The following document comprises five main parts.
The first is a description and analysis of the Brazilian Governmental Funding Agencies, both at
the Federal and State levels.
The second is a description and analysis of the nowadays situation of the Triple Helix model in
Brazil.
The third part comprises a description of the Brazilian private financial system to support
innovations.
The fourth part is an analysis of the main difficulties that an enterprise and a startup (Brazilian
or foreigner) can face to establish in Brazil, including some advices and warnings.
The fifth and final part is a description of the current composition of the Brazilian EEN
Consortium that includes, besides IBICT (Coordinator of the network), Embrapii, Apex,
Assintecal, the Brazilian association of leather and shoe industry, and ABDI as invitee. This
section will also assess how the network can act to support European enterprises and start-ups
in order to find Brazilian partners and establish agreements and joint ventures.
3
II. Governmental Funding Agencies
Banco Nacional de Desenvolvimento Econômico e Social – BNDES (National Bank for
Economic and Social Development)
https://www.bndes.gov.br/wps/portal/site/home
Support for innovation is a strategic priority for BNDES. In order to provide this support, the
Bank seeks to act in line with current public policies and in a complementary manner to other
institutions of the National Innovation System.
The BNDES 'objective is to encourage and support operations associated with training and the
development of innovative environments, with the aim of generating economic or social value
and improving the competitive positioning of companies, contributing to the creation of better-
quality jobs, increasing productive efficiency, environmental sustainability and sustained growth
in the country.
Support for innovation, offered by BNDES, includes the following modalities:
Loans
• Sectorial programmes (Profarma Biotechnology, Profarma Innovation, Prosoft, Pro BK
Innovation, Prodesign, Proengineering, Proplastic, Promineral, Plano Inova Empresa)
• Specific financing lines (BNDES Inovação, BNDES Automático, BNDES Credit Limit, BNDES
Card, BNDES Soluções Tecnológicas, BNDES THAI)
Grants for ICTs (Scientif and Technological Institutions)
• Technological Fund - Funtec
Direct capital (contributions via investment funds)
• Criatec (seed capital).
The three most demanded lines have been the ProEngineering, Innovation Line and Prosofit
programmes.
The ProEngineering Programme is characterized by financing, starting at R $ 1 million,
engineering projects and services in strategic sectors, with a view to stimulating the
improvement of skills and technical knowledge in the country.
The Innovation Line is used to finance, also from R $ 1 million, projects for innovation in
products, processes, and marketing, in addition to improving skills and technical knowledge in
the country.
Like the previous programmes, Prosoft also aims to finance projects starting at R $ 1 million, in
this case, with a focus on investments and business plans of software companies and IT services.
As most BNDES programmes consist of offering credit lines, the Bank's disbursements have been
predominantly of loan resources. The grant resources, most used by companies for innovations
4
with higher technological risk, represented only about 5% of the values, applied directly in
innovation projects.
Who can request financial resources from BNDES?
Each BNDES financing instrument is intended for one or more customer profiles, including:
• companies based in Brazil;
• individual entrepreneurs (natural or legal)
• individual microentrepreneurs (legal entity);
• public entities or bodies, directly and indirectly, at the Federal, State, Municipal and
Federal District levels;
• private law foundations and associations;
• cooperatives;
• individuals domiciled and resident in the country, provided that they exercise economic
activities and are properly registered, such as truck drivers and rural producers;
• consortia and condominiums that exercise productive activity; and
• unions and clubs.
To request financing with BNDES funds, the client must meet the following minimum
requirements:
• be up to date with tax, tax, and social obligations;
• present a satisfactory registration;
• be able to pay;
• have sufficient guarantees to cover the risk of the operation;
• not be in a credit recovery regime;
• comply with import legislation, in the case of financing for the import of machinery and
equipment; and
• comply with environmental legislation.
Individuals or legal entities that:
• have a default with the BNDES System or are part of the Economic Group that have a
default with the BNDES System;
• are responsible for the protested title (unless there is one, at the discretion of the
BNDES, justified the protest that occurred);
• appear in a lawsuit that, at the BNDES 'discretion, could compromise the ability to fulfill
its obligations before the BNDES;
• have registration notes indicating repeated default or restrictions on their suitability; or
• are in bankruptcy, bankruptcy or judicial or extrajudicial recovery.
Also, legal entities whose controllers fall under the above restrictions cannot be beneficiaries.
The BNDES classifies its clients according to their size, which allows them to act according to the
characteristics of each segment, by offering lines, programmes, and specific conditions. Support
for micro, small and medium-sized enterprises (MSMEs), for example, is considered a priority by
BNDES, offering special conditions with the main aim of facilitating these companies' access to
credit.
5
The size classification is carried out according to the Gross Operating Revenue (Receita
Operacional Bruta - ROB) of the companies or according to the annual income of individual
customers.
SIZE VALUE IN R$ million
MICRO ≤ 0,36
SMALL 0,36 – 3,6
MEDIUM 3,6 – 90,0
MEDIUM-BIG 90,0 – 300,0
BIG ≥ 300,0
Source: BNDES
What can be financed
The resources provided by BNDES must be used by the client for specific purposes, such as:
• investments for the implantation, expansion, modernization and / or recovery of
enterprises, infrastructure, companies, and public and private institutions, including
studies, projects, civil works, facilities, training, among others;
• production or acquisition of new machinery and equipment (including utility vehicles,
buses, trucks and aircraft), nationally manufactured and accredited by the BNDES;
• new goods, supplies, services, software;
• working capital;
• export of national goods and services; and
• acquisition of imported goods and services and hospitalization expenses (through
specific lines and conditions for this purpose), provided there is evidence that there is
no national similar.
Accreditation of machinery and equipment
To be financed with BNDES resources, machines, equipment, systems, and components must be
qualified in the BNDES Computerized Supplier Accreditation (CFI) and must have a minimum
nationalization index of 60%, in value and weight, calculated according to criteria defined by
BNDES, or comply with the Basic Productive Process (Processo Produtivo Básico – PPB).
Temporarily, the BNDES is accepting a nationalization index of at least 50%.
New goods, supplies, services, and software can be financed through the BNDES Card for micro,
small and medium companies. The BNDES Card has its own accreditation system. Accredited
items and information on accreditation can be found on the BNDES Card Operations Portal.
What does BNDES NOT finance?
Non-supportable sectors:
• arms trade;
• motels, saunas and spas;
• prediction and similar games; and
• banking / financial activity, except for support for microcredit.
6In the case of financing working capital alone, the granting of credit is prohibited when any of
the client's activities is included in the list of non-supportable sectors above.
Unsupportable developments:
• mining sector ventures that incorporate a rudimentary mining or mining process;
• social actions and projects contemplated with tax incentives; and
• real estate developments, such as residential buildings, commercial buildings for resale,
commercial developments for office rentals, time-sharing, hotel-residence, and
subdivision.
Financiadora de Estudos e Projetos - Finep
http://www.finep.gov.br/
Finep provides grants and loans to Brazilian research institutions and companies. Finep's support
covers all stages and dimensions of the scientific and technological development cycle: basic
research, applied research, innovations and development of products, services, and processes.
Support Instruments
Finep’s supports cover all ST&I cycle, from basic research until the development of products,
services and processes in enterprises
Grants for scientific and
Loans for enterprises Grants for enterprises
technological institutions
Direct investments
Investment in innovative enterprises through the
Investments in funds
acquisition of partner participation: support to
capitralisation and development
Source: Finep
Finep also supports the incubation of technology-based companies, the implementation of
technology parks, the structuring and consolidation of research processes, the development and
innovation of established companies, and the development of markets. In addition, as of 2012,
Finep also started offering support for the implementation of a first industrial unit and also
incorporations, mergers and joint ventures.
Loans
Finep offers loans for projects and Strategic Innovation Plans, practicing terms and rates that
are compatible with supporting the innovative activities of Brazilian companies. For this,
equalization of interest rates can be used.
Projects developed entirely by companies installed in the national territory will be supported. In
the case of an association with a company whose capital control is foreign, the conditions for
7the effective transfer and absorption of technology by the proposing company must be proven.
Companies whose majority share capital, with voting rights, is owned by people who are not
resident in the country and excluded from economic activities related to the sectors listed by
Decree No. 2,233, of May 23, 1997, will not be able to make new ones in their fixed assets.
The reference that guides the selection of Strategic Innovation Plans proposed to Finep is
composed of the concepts of degree of innovation and relevance of innovation for the affected
economic sector.
The degree of innovation centrally assesses the intensity of innovation, its degree of originality
and the company's technological effort to develop its Strategic Innovation Plan. The second axis
of analysis is that of the relevance of innovation to the economic sector affected by it. It
evaluates the impact for the country, the sector, and the company.
Finep also supports pre-investment projects, due to its importance for the consolidation of
technical knowledge in engineering services in the country.
Loans are supported with own resources or from transfers from other sources. Companies and
other organizations interested in obtaining credit can submit their Strategic Innovation Plans to
Finep at any time. Companies must access Finep Inovação1, which contains all the information
necessary to obtain financing for investment in innovation in the form of credit, as well as access
to the Company Portal, intended for the company's registration and its Strategic Innovation Plan
for Finep's analysis.
Grants to Scientific, Technological and Innovative Institutions (ICTs)
Grants are provided to national, public, or private, non-profit Scientific, Technological and
Innovative Institutions for the execution of scientific and technological development projects,
research infrastructure, as well as human resources training. Projects can be carried out by
institutions in isolation, in groups, or in cooperation with companies.
Finep selects and supports Science, Technology and Innovation projects, presented by national
ICTs (Scientific and Technological Institutions), with resources originating from the National
Fund for Scientific and Technological Development (FNDCT), the Fund for the Technological
Development of Telecommunications (FUNTTEL) and cooperation agreements with ministries,
agencies and sectoral institutions. Projects are selected by public call.
Specific orders can be used to solve critical problems, in which the existence of specific
competence and the singularity of the executing institution are identified. The actions operated
by Finep with funds from ministries, agencies and sectorial institutions follow the guidelines and
demands established in the respective cooperation instruments.
The mechanisms and criteria for evaluating, qualifying, and selecting projects are defined by
Finep, according to strategic guidelines and themes defined in the deliberation instances related
to the origin of the resources, and having as parameters the Federal Government's Plans and
Policies.
1
http://www.finep.gov.br/apoio-e-financiamento-externa/programas-e-linhas/apoio-direto-a-inovacao
8Economic Grant
The economic grant consists of the granting of financial resources to companies to carry out
research and development and innovation activities without the need to return to the granting
government agency.
There is a sharing of project risks between the State and companies, insofar as they must present
a counterpart.
The grant of Economic Subsidy to Innovation is operated by Finep by means of a public call.
The themes for qualifying the projects are defined according to the current industrial and
technological policy.
In the Economic Subsidy to Innovation modality, Brazilian companies, private or public, of any
size, individually or in association, are eligible to receive non-refundable resources, for the
execution of technological innovation projects that involve technological risk and market
opportunities.
The mechanisms and criteria for evaluating, qualifying, and selecting projects are defined by
Finep, according to strategic guidelines and themes defined in the deliberation instances related
to the origin of the resources, and having as parameters the Federal Government's Plans and
Policies.
Tecnova
Support to micro and small companies in research, development, and innovation projects
through economic subsidy resources. The instrument is operated in a decentralized manner,
through networks of state operational agents, and has the support of Sebrae2.
Investment
Finep invests directly and indirectly in companies characterized by a high degree of technological
innovation, providing an additional source for the development of technology-intensive projects
and the strengthening of the capital structure of innovative companies.
Finep's objectives when investing directly and indirectly in companies are:
• Capitalize and develop innovative companies with the potential to have a relevant
impact on the market in which it operates and a compatible financial return;
• Stimulate innovation activities by Brazilian companies in priority sectors and
technologies for the country;
• Strengthen the capital structure and expand access to the capital market by innovative
companies; and
• Encourage the adoption of best corporate governance practices.
2
Sistema Brasileiro de Apoio à Micro e Pequena Empresa (Brazilian System to Support Micro and Small
Enterprises)
https://www.sebrae.com.br/sites/PortalSebrae
9Finep Startup Program
Capital contribution via stock option contract:
Finep enters into an option contract for the subscription of shares in the share capital of
innovative micro and small companies.
The selection of companies occurs through a public selection notice, where the electronic
address for accessing the registration form is informed.
Finep invests in companies that have the following characteristics:
• Companies that have already completed the development of their product or service
and are looking for resources to gain scale in markets with high growth potential;
• Companies that develop innovative proprietary technology; and
• Companies whose products and services are the main object of the contribution of
resources contribute to the solution of a relevant and wide-ranging problem.
Intellectual property
Finep values the obtaining of intellectual property rights on the results achieved in projects,
programmes and research and innovation plans supported by it as an instrument to encourage
the development of innovative technologies and to increase the competitiveness of Brazilian
companies and as a factor to stimulate the economic and social development of the country.
Finep will not require ownership or co-ownership of industrial and intellectual creations
resulting from the results of projects, programs or research and innovation plans it supports,
and such titles must belong exclusively to Brazilian institutions and companies supported and
executing research and innovation activities.
The terms of adjustment on intellectual property, confidentiality obligations and licensing
conditions must be negotiated and established exclusively by the supported Brazilian
institutions and companies, observing the relevant legislation, without the participation of
Finep.
Deposits or registration of intellectual property protection requests must be initiated with the
National Institute of Industrial Property - INPI and communicated to Finep.
The products or processes developed in the scope of projects, programs and research and
innovation plans supported by Finep should preferably be produced and marketed by Brazilian
companies, contributing to national production and to the generation of jobs and foreign
exchange for Brazil.
Regarding support for expenses related to intellectual property, expenses in the country and
abroad may be considered eligible, if they are justified in the context of the project and the
organizations' business strategies.
Centelha Programme
Centelha intends to disseminate the culture of innovative entrepreneurship throughout the
national territory through the institutional mobilization and articulation of the actors in the local,
state, and regional innovation ecosystems of the country.
10Through the joint action of Finep and MCTI with state partners, the idea is to contribute to
expanding the quantity and improving the quality of proposals for technology-based ventures
submitted to the environments that promote innovation in the country, such as business
incubators and accelerators, coworking spaces, open prototyping laboratories, and parks and
technological centres, among others.
Target Audience:
• Microenterprises or Small Enterprises (MEEPP), headquartered in the participating
state, with a previous constitution date of up to 12 months before the date of
publication of the notice; and
• Individual (project coordinator) who, if approved, must establish a MEEPP with
headquarters in the participating state to contract and receive non-reimbursable
financial resources.
Operational Model
Centelha is carried out through an economic grant and operated through accredited state
partners, using resources from the FNDCT (National Fund for Scientific and Technological
Development).
The program also acts in non-financial support to participating entrepreneurs, through training
and support, access to incubators and potential investors and expansion of networking and
dissemination of the companies involved.
The Ministry of Science, Technology, and Innovations and Finep operate in partnership with the
National Council for Scientific and Technological Development (CNPq), the National Council for
State Research Support Foundations (Confap) and the CERTI Foundation3.
The selection of state partners occurs through an invitation letter. The proposing / agreed and
executing institutions must be bodies or entities of the direct or indirect public administration
of any sphere of government or private non-profit entity, being preferably Research Support
Foundations - FAPs. State partners are responsible for transferring up to R $ 30 million in three
years, of which R $ 10 million per year. Each selected project receives approximately R $ 50
thousand.
Conselho Nacional de Desenvolvimento Científico e Tecnológico – CNPq
http://www.cnpq.br/
The National Council for Scientific and Technological Development (CNPq), an agency of the
Ministry of Science, Technology, and Innovations (MCTI), has as its main duties to promote
scientific and technological research and encourage the training of Brazilian researchers.
3
https://www.certi.org.br/
11Created in 1951, it plays a major role in the formulation and conduct of science, technology, and
innovation policies. Its performance contributes to national development and the recognition of
Brazilian research institutions and researchers by the international scientific community.
Objectives
As a research promotion agency, linked to the Ministry of Science, Technology, Innovations and
Communications (MCTIC), CNPq is responsible for participating in the formulation, execution,
monitoring, evaluation and dissemination of the National Science and Technology Policy,
especially:
• promote and encourage the development and maintenance of scientific and
technological research and the training of qualified human resources for research, in all
areas of knowledge;
• promote and foster scientific and technological research and human resources training
focused on issues of economic and social relevance related to the specific needs of
sectors of national or regional importance;
• promote and foster technological innovation;
• promote, implement, and maintain mechanisms for the collection, analysis, storage,
dissemination and exchange of data and information on the development of science and
technology;
• propose and apply norms and instruments to support and encourage research and
development activities, dissemination, and absorption of scientific and technological
knowledge;
• promote the execution of agreements, protocols, covenants, programs and projects for
the exchange and transfer of technology between public and private entities, national
and international;
• support and promote meetings of a scientific and technological nature or participate in
them;
• promote and carry out studies on scientific and technological development;
• provide services and technical assistance in its area of competence;
• provide assistance in the purchase and import of equipment and supplies for use in
scientific and technological research activities, in accordance with the legislation in
force; and
• accredit institutions to, under the terms of the relevant legislation, import goods with
tax benefits for activities related to scientific and technological research.
Scholarships and Grants
CNPq grants scholarships for the training of human resources in the field of scientific and
technological research, in universities, research institutes, technological and professional
training centres, both in Brazil and for carrying out abroad.
In addition to promoting the training of human resources in strategic areas for national
development, CNPq provides financial resources for the implementation of Research and
Development (R&D) projects, programmes, and networks, directly or in partnership with the
States of the Federation.
12CNPq also invests in scientific and technological dissemination actions with financial support for
publishing journals, promoting scientific events and the participation of students and
researchers in the main national and international congresses and events in the area of science
and technology.
Scholarship modalities
CNPq offers various types of scholarships for training and promoting research, for high school
students, undergraduate, graduate students, recent PhDs, and researchers already experienced
in the country and abroad. The scholarships are awarded directly by CNPq or by educational and
research institutions to which CNPq allocates scholarship quotas.
Scholarships in the Country
Various types of scholarships are offered to high school and college students, at graduate level,
interested in working in scientific research, and specialists to work in research and development
in companies and technological centres.
Scholarships abroad
The scholarships abroad offered by CNPq are destined to the training of students and the
improvement of researchers in renowned foreign institutions.
Business Scholarships
For some years, CNPq has been investing in the application of financial resources in the training
of qualified personnel to implement Research, Development, and Innovation (R, D & I) projects
in small and medium-sized companies.
Support to research
In addition to promoting the training of human resources in strategic areas for national
development, CNPq provides financial resources for the implementation of Research and
Development projects, programs, and networks, directly or in partnership with the States of the
Federation.
CNPq also invests in scientific and technological dissemination actions with financial support for
the holding of scientific events, participation of students and researchers in the main national
and international scientific congresses and events and the publishing of scientific journals.
Programmes
CNPq finances RD&I activities through the definition of programmes that aim to develop or
encourage actions on topics considered as priorities. CNPq currently has a portfolio of 13
programmes, as described below:
1. ALI - Local Innovation Agents
2. International cooperation
3. PRÓ CENTRO-OESTE Network
4. REFLORA
5. Archipelago and Ocean Islands
6. RHAE - Researcher at the company
7. Long-Term Ecological Research Program
8. Women and Science
9. SISBIOTA
1310. Institutional ICT Programs
11. PROTAX
12. PPBio
13. PROANTAR
Administrative procedures
CNPq grants its instruments and encourages RD&I through calls that are open at different times,
depending on the type of financing to be granted.
Empresa Brasileira de Pesquisa e Inovação Industrial - Embrapii
https://embrapii.org.br/
Fostering research, development, and innovation projects in the Brazilian industry, EMBRAPII is
a federal social organization that supports technological research institutions promoting
innovation through cooperation with scientific and technological research institutions, both
public or private, focusing on business demands and targeting risk sharing in the pre-competitive
phase of innovation.
To encourage the industry to invest in innovation, EMBRAPII has established partnerships with
institutions representing the industrial sector (CNI (Confederação Nacional das Indústrias); FIESP
(Federação das Industrias do Estado de Sao Paulo); SENAI (Serviço Nacional de Aprendizado
Industrial) etc.), especially to stimulate R&D projects between companies and EMBRAPII Units,
and to establish a reference network for research and innovation activities in the Brazilian
productive sector.
Moreover, to strengthen the support for the Brazilian innovation and promote initiatives for
scientific collaboration and development in R&D research projects carried out in EMBRAPII
Units, EMBRAPII signed technical cooperation agreements with development institutions in
several states across Brazil. On another front, to streamline the supply of credit with low interest
rates and long terms to the productive sector, guaranteeing the financing to the company’s
counterpart, EMBRAPII entered partnerships with regional banks and financing agencies.
14Source: Embrapii
How EMBRAPII works for Research Institutions
The research institution submits proposals to the Public Accreditation Calls, opened periodically
by EMBRAPII.
Once accredited, through an Action Plan, the EMBRAPII Unities4 and EMBRAPII IF Poles5 can
develop RD&I projects with companies.
Advantages for the research institution:
• Less risk and cost, as the investment is shared;
• Agility: Immediate release of a portion of the Action Plan's resources;
• Partnership with companies that can sell products and services developed with the
institution's knowledge input; and
• Professionalization of the Unit’s management supported by the EMBRAPII Operational
Excellence System.
4
They are constituted from specific technological competences of public and private non-profit scientific
and technological research institutions, with proven experience in the development of innovation
projects in partnership with companies in the industrial sector.
The expectation is that industrial companies will be attracted by the strong knowledge base existing in
the EMBRAPII Units and by their capacity to generate technological solutions, enhanced by the cost and
risk sharing mechanism offered by EMBRAPII to generate industrial innovation in the country.
5
They are constituted from specific technological competences of the Federal Institutes of Education,
Science and Technology of the Ministry of Education. The performance of an EMBRAPII IF Pole is geared
towards meeting the demands of the productive sector, through research, development, and innovation
(RD&I) and professional training for RD&I activities in the industry.
The expectation is to strengthen the existing knowledge base in these institutions and their capacity to
generate technological solutions, enhanced by the cost and risk sharing mechanism offered by
EMBRAPII to generate industrial innovation in the country.
15How resources are released for accredited units
• EMBRAPII anticipates resources for the Unit to contract projects with companies →
project costing;
• The project is negotiated directly between the COMPANY and the accredited Unit; and
• Enables agility, flexibility, and speed in the use of resources and in changing the scope
of projects.
How EMBRAPII works for Companies
The entrepreneur gets in direct contact with the EMBRAPII Unit or EMBRAPII IF Polo, which will
meet the business demand for RD&I. The accredited units have a flexible and agile cooperation
model and are specialists in technological skills, ensuring a high level of service in these areas.
Advantages for the entrepreneur:
• Less risk and cost, as the investment is shared;
• Focus on the demand for innovation from industrial companies;
• Part of the project's resources is already available;
• Agility in contracts;
• Research institutions with competence in R, D & I and, therefore, a better level of
technological development;
• Proven experience: professionalization in the execution of projects; and
• EMBRAPII has no participation in Intellectual Property.
Resources are available:
• EMBRAPII anticipates resources for its accredited Unit, which contract projects directly
with companies. In this way, the resources are already available as soon as the contract
is signed. These resources are used to fund the project;
• The project is negotiated directly between the company and the accredited Unit; and
• Enables agility, flexibility, and speed in the use of resources and in changing the scope
of projects.
From the point of view of the composition of the resources involved in the projects, it is possible
to perceive that the participation of the companies has remained, on average, above the
percentage of one third originally expected. In general, companies participate with more than
40% of the amounts invested, while Embrapii assumes about 30% of disbursements and ICTs
around 20%.
This data demonstrates how Embrapii's financing model, characterized by greater flexibility and
agility in the execution of resources, has also been effective in leveraging private investment.
This aspect is key, since one of the biggest challenges of innovation policies is exactly to make
companies supported with public resources raise the level of investment.
In the Embrapii model, this formula proved to be efficient. Additionally, by bringing the
knowledge generated in ICTs closer to the reality of companies, Embrapii facilitates and
streamlines the “university-company” articulation, which is recognized to be beneficial for
strengthening the national innovation system. For these reasons, it is understood that the model
should be stimulated and expanded.
16Agência Brasileira de Desenvolvimento Industrial – ABDI
https://www.abdi.com.br/
ABDI’s Programa Nacional Conexão Startup Indústria6 has the purposes of promoting the
business environment among startups and industries, focusing on digital integration actions of
the different stages of industrial products value chain and development of solutions or “concept
proofs” by startups for demands identified by the industries.
In numbers:
• 30 industries and 120 startups selected to form work groups;
• 30 industries and 60 connected startups for the co-development of concept proofs;
• 90% for Brazilian industries and startups and 10% for Portuguese industries and
startups;
• Award for selected startup: R$ 80,000.00; and
• Total in ABDI awards: R$ 4,800,000.00.
Brazilian National Council of State Funding Agencies - CONFAP
State-level financing
CONFAP is a non-profit organization, created in 2006 to articulate the interests from Brazilian
State Research and Innovation Support Foundations, among other goals - https://confap.org.br.
CONFAP is composed by 26 State Funding Agencies (Fundações Estaduais de Amparo à Pesquisa
– FAPs), based in 25 Brazilian States, plus the Federal District. Only the State of Roraima is still
in the process of setting up its FAP.
Brazilian FAPs meet in the CONPFAP National Forums approximately 4 times per year, thus
gathering and articulating Research Funding Agencies of Brazilian States and interacting with
international partners.
In terms of international cooperation, CONFAP has numerous active Bilateral and Multilateral
Cooperation Agreements and Joint Initiatives with several countries all around the globe and
has a well-established cooperation with the European Union.
CONFAP has a unique territorial coverage, having a notable capillarity, and a strong
acknowledgement of regional differences, and acts directly with governmental actors which
support R&I policies and programmes, through national partnerships with Federal Funding
Agencies: Programmes in partnership with CAPES, CNPq and FINEP, among others. CONFAP is
also member of the National Council of ST&I and ts network closely involves all Brazilian HEIs,
which apply to each Funding Agency at State level for projects and activities in the field of
ediucation, research and innovation.
6
Available in https://startupindustria.com.br/
17As a general rule, Brazilian State Funding Agencies finance scholarships, mobility and grants,
related to scientific, technological and innovation projects.
Brazilian State Funding Agencies
Brazilian State State Funding Agency - FAP
Acre Fundação de Amparo à Pesquisa do Estado do Acre – FAPAC
Alagoas Fundação de Amparo à Pesquisa do Estado de Alagoas – FAPEAL
Amapá Fundação de Amparo à Pesquisa do Estado do Amapá – FAPEAP
Amazonas Fundação de Amparo à Pesquisa do Estado do Amazonas – FAPEAM
Bahia Fundação de Amparo à Pesquisa do Estado da Bahia – FAPESB
Ceará Fundação Cearense de Apoio ao Desenvolvimento Científico e Tecnológico -
FUNCAP
Distrito Federal Fundação de Apoio à Pesquisa do Distrito Federal – FAPDF
Espírito Santo Fundação de Amparo à Pesquisa e Inovação do Espírito Santo - FAPES
Goiás Fundação de Amparo à Pesquisa do Estado de Goiás - FAPEG
Maranhão Fundação de Amparo à Pesquisa e ao Desenvolvimento Científico e
Tecnológico do Maranhão – FAPEMA
Mato Grosso Fundação de Amparo à Pesquisa do Estado do Mato Grosso - FAPEMAT
Mato Grosso do Sul Fundação de Apoio ao Desenvolvimento do Ensino, Ciência e Tecnologia do
Estado de Mato Grosso do Sul – FUNDECT
Minas Gerais Fundação de Amparo à Pesquisa do Estado de Minas Gerais - FAPEMIG
Pará Fundação Amazônia de Amparo a Estudos e Pesquisas do Pará - FAPESPA
Paraná Fundação Araucária
Paraíba Fundação de Apoio à Pesquisa - FAPESQ
Pernambuco Fundação de Amparo à Ciência e Tecnologia - FACEPE
Piauí Fundação de Amparo à Pesquisa do Estado do Piauí - FAPEPI
18Rio de Janeiro Fundação Carlos Chagas Filho de Amparo à Pesquisa do Estado do Rio de
Janeiro – FAPERJ
Rio Grande do Norte Agência de Fomento do Rio Grande do Norte S/A – AGN e Fundação de Apoio
à Pesquisa do Rio Grande do Norte - FAPERN
Rio Grande do Sul Fundação de Amparo à Pesquisa do Rio Grande do Sul
Rondônia Fundação Rondônia de Amparo ao Desenvolvimento das Ações Científicas e
Tecnológicas e à Pesquisa do Estado de Rondônia – FAPERO
Santa Catarina Fundação de Apoio à Pesquisa do Estado de Santa Catarina - FAPESC
São Paulo Fundação de Amparo à Pesquisa do Estado de São Paulo - FAPESP
Sergipe Fundação de Apoio à Pesquisa e à Inovação Tecnológica do Estado de Sergipe
– FAPITEC
Tocantins Fundação de Amparo à Pesquisa do Tocantins – FAPT
19III. Interaction environments for academy-business-entrepreneurs
Since the mid-twentieth century, centralized and episodic innovation models have been
replaced in the world's major economies by more decentralized regimes that shorten value
generation cycles and bring new dynamics to industrial development. In this new trajectory, the
distance between entrepreneurship and research decreases, and the development of new
technologies simultaneously becomes a scientific and industrial challenge.
In this context, the main American and European universities began to expand their activities
far beyond the three traditional missions - research, teaching and knowledge transfer -
becoming also important centers of entrepreneurship, active actors of articulation and
connection with others agents of the innovative entrepreneurship ecosystem (US Department
of Commerce, 2013).
The promotion of the entrepreneurship ecosystem made by the universities can pass through
three pillars: (a) professionalization and training of professionals dedicated to innovative
entrepreneurship within the university; (b) diversification of investment and financing
instruments for different stages of innovative entrepreneurship; and (c) development of
mechanisms to support entrepreneurship in its different stages, in articulation with the private
sector.
The entrepreneurship ecosystem in Brazilian universities, even if incipient, involves a diverse
range of agents, such as students, teachers, junior companies, alumni network, teaching units
(colleges and institutes), business associations, incubators, Technological Innovation (NITs), in
addition to the public agents at different governmental levels.
The more integrated, diversified and complex, the more dynamic and capable the ecosystem
will be to act transversally to support innovative entrepreneurship and enhance its impact on
the generation of results. Some articulations already occur in the main Brazilian universities and
result in important initiatives to support startups (figure 2).
20Figure 2 - Examples of actions for startups in universities
Source: CNI (2016)
Although the current mechanisms cover practically all the stages of the entrepreneurial process,
there is a great concentration of actions in the initial stages, especially in the promotion and
awareness on the theme of entrepreneurship. In this sense, new efforts are needed, for
developing the subsequent stages, complementary to the incubation process, which aim, for
example, to attract resources and internationalize the projects.
There are also cultural and institutional barriers that hinder and hamper the association
between universities and practical challenges demanded by the market. It is imperative that
current University / business exchange mechanisms mature and stimulate the emergence of
new forms of relationship (Bramwell and Hepburn, Wolfe, 2012). The institutional complexity
inherent in these organizations makes it difficult for structural changes to occur in the short and
medium term. However, it is possible to carry out occasional changes in some organizations,
capable of generating concrete results.
Two actors involved in the development of innovative entrepreneurship in Brazilian universities
can be targeted in this direction: NITs and technology-based business incubators.
According to the new Legal Framework of ST & I (Law 13.243 / 2016), "business incubators are
organizations or structures that aim to stimulate or provide logistical, managerial and
technological support to innovative and knowledge-intensive entrepreneurship, with the aim of
facilitating the creation and the development of companies that have as a differential the
performance of activities focused on innovation "(Brazil, 2016).
The NITs are "structures instituted by one or more Scientific, Technological and Innovation
Institutions (ICTs), with or without own legal personality, whose purpose is the management of
institutional innovation policy and by minimum competences the attributions provided for in
this Law" (Brazil, 2016).
21Both structures are important, not only because they include institutional bodies responsible for
systematically supporting innovation and entrepreneurship, but also because they are directly
or indirectly related to the set of stages of the entrepreneurial process, which goes from training,
through networks ( networking) and even capitalizing on startups. Moreover, these two
structures can be transversal in their actions, since they rely on public legitimization, either by
law or through programs.
Actions taken by these organizations do not, of course, deplete the possibilities of activities
within academic environments that favor the birth and development of startups. However,
these are ways that can generate impacts in the short and medium term, without requiring other
structural changes in the ecosystem.
Nuclei of Technological Innovation (NITs)
The NITs are bodies foreseen by the Innovation Law, whose purpose is to manage the innovation
policy of the ICTs in the universities, by supporting the researchers - in the protection of the
results of their research - in complying with the policies of technological innovation of the
institutions, interaction with the public and private sector and prospecting partners for
technology transfer (MCTI, 2015).
By 2014, there were 215 NITs associated with the Forum of Managers of Innovation and
Technology Transfer (Fortec, 2014).
Since its idealization, NITs constitute a link between ICTs and the productive sector. Since 2004,
there has been a growth in the number of NITs and the importance of their role, especially in
the management of intellectual property. At the same time, there is an improvement in the
relationship between ICTs and companies, with increased royalty transfer, better portfolio
management and new business prospects involving business and ICTs.
Thus, NITs play a relevant role, as they are responsible for proposing, monitoring and evaluating
innovation policies, to promote the protection and maintenance of intellectual property and to
transfer new technologies to the business sector (Martins, 2012).
With the new Legal Framework of CT & I, NITs gain administrative agility in their activity of
managing the innovation policy of ICTs, as well as in their representation, notably because of
the possibility of adopting their own legal personality, including private law. It is also possible to
establish partnerships between ICTs and existing non-profit private entities, such as support
foundations (Article 16, §§ 3 and 5 of the Innovation Law).
The new S & T Legal Framework has also established new legal competencies for NITs, including
promoting and monitoring the relationship of ICTs with companies, in particular with regard to
the negotiation and management of technology transfer agreements and contracts of ICT
(Article 16, § 1, items IX and X, of the Innovation Law).
It should be noted that, among the modalities of technological transfer that the NITs perform,
there is the licensing of university patents by the company, established agreements with private
or public institutions and creation of startups, in particular, based on research. Although
technological licensing and the agreement with private or public institutions are effective ways
in the process of technology transfer, the encouragement and creation of technology-based
companies are the most effective way to bring basic research closer to applied research and
bring innovation to the market (Kondo, 2001). In this way, the industry is also dynamized, with
22innovative products and processes (Araujo, 2005), helping the student community to
commercialize the technologies developed at the university and thus to generate income
(Shane, 2004).
Because they are the organizations responsible for the management of the assets with great
potential to generate innovative ventures - and now, because their scope of performance has
expanded - NITs have become more important in the ecosystem of innovation and
entrepreneurship of universities.
It is precisely for this reason that three actions are proposed that are capable of institutionally
consolidating NITs even further.
1. Strengthen the arrangements of thematic and sector NITs;
2. Articulate new forms of financing and investment for innovative ventures; and
3. Decentralize activities, professionalize management, and specialize professionals.
Strengthen thematic and sectoral arrangements
NITs can extrapolate from mere consulting and act as managers of technology policy, as well as
mediating the relationship between ICTs and companies. In addition, with the possibility of
acting as a legal entity under private law, the administrative agility in the management of its
duties is significantly increased.
The innovation Law opens space for the identification of the needs of companies and the
accomplishment of work closer to the ICTs with the market. Also, within this scope, a possible
form of action is the joining of several ICTs, through the unification of their actions in a common
NIT or in NITs arrangements. Such arrangements are provided for in the Innovation Law, when
determining that ICTs have their own NIT or in association with other institutions. The activities
of the arrangements are defined in the MCTI 251 regulation, dated March 12, 2014.
This collaborative form has the advantage of centralizing actions to disseminate research on
each ICT, attracting partnerships to the institutions involved, disbursing investments, as well as
allowing ICTs, lacking sufficient resources and qualified professionals, to act on issues related to
management of innovation and entrepreneurship.
Currently, there are some NITs arrangements spread across Brazil, such as the NIT Arrangement
of the Western Amazon, Rede Namor, the NIT Mantiqueira and the NIT Rio7. Each of these
arrangements represents the meeting of several NITs of various ICTs, dealing with management
and the relationship with companies.
NIT Rio, for example, articulates several research institutes such as: Brazilian Center for Physical
Research (CBPF); Center for Mineral Technology (Cetem); National Institute of Pure and Applied
Mathematics (Impa); National Institute of Technology (INT); National Laboratory of Scientific
Computation (LNCC); Museum of Astronomy and Related Sciences (Mast); and National
Observatory (ON). This articulation was created to manage the technological policy of some of
the most renowned ICTs in the country, which also includes postgraduate courses of
international relevance.
Finally, it should be noted that the new S & T Legal Framework also places special emphasis on
the internationalization of S & T activities carried out by public ICTs, through the formalization
23of agreements or contracts with public or private entities, foreign or international (article 15, §
1 of Law No. 13,243, of 2016).
These arrangements are important to accelerate the technological catch-up process, as they
enable public ICTs to formalize relationships with the most advanced technology and innovation
centers, with a view to developing international cooperation, executing activities, and enabling
the allocation and outside.
Expanding financing and investment systems
The creation of new funding and investment channels, in partnership with NITs, is a way to
streamline the transition between research and technological development, as well as to
support (with seed-investment) academic startups. These channels can be structured by the
universities themselves, in agreements or in partnerships with other institutions.
To exemplify this performance of NITs, it is worth mentioning the model of Fundep Participações
S.A. (Fundepar)7, which accompanies the international policies of Science, Technology and
Innovation, with the objective of developing innovative business, generated from projects of
students, teachers and connected researchers universities and research centers, such as the
Federal University of Minas Gerais (UFMG), with financial investment and support to business
structuring. Fundepar carries seed capital investment, with a contribution of up to R $ 500,000,
through a minority shareholding, made through the purchase of shares or debt securities,
convertible into shares.
Decentralize, professionalize management, and specialize professionals
The lack of interest on the part of university leaders in relation to the private sector has limited
the performance of the academy, in the area of technological development and innovation, to
questions related to patenting alone. In some places, such as the University of Campinas
(Unicamp) and the University of Minas Gerais (UFMG), NITs have become important players
both for the entrepreneurship ecosystem and for the regional innovation ecosystem. These
universities have built new institutional interactions and developed innovative articulation tools.
As an example of successful actions, mediated by NITs, we highlight the Unicamp Ventures, a
network of relationship and collaboration among entrepreneurs connected to Unicamp, formed
by students, alumni, teachers, former teachers, employees, incubators and graduates of the
Institution in addition to the Technological Base Incubator of Unicamp.
Created in 2006 the network aims to integrate the community of alumni entrepreneurs and
interact on topics relevant to strengthening the network of entrepreneurs and companies, born
from Unicamp.
Within UFMG, Somos UFMG was developed to facilitate the mapping of competencies, aiming
to increase the interaction of the University, in areas of scientific and technological research,
with public and private institutions. Through Somos UFMG, it is possible to identify researchers,
their specialties and scientific production, in addition to accessing information about units,
departments, intellectual property assets, infrastructure installed in laboratories, among other
information. The development of the Program is constant and the responsibility of the
7
http://fundepar.com.br/ - accessed on 4 Nov. 2020
24Coordination of Transfer and Technological Innovation (CTIT) - the NIT of UFMG. This experience
has been adopted and adapted in other Brazilian universities.
In line with these successful experiences, the new S & T Legal Framework establishes that
innovation policy, to be approved by public-sector ICT, must necessarily contain guidelines and
guidance on institutional actions to train human resources in entrepreneurship, innovation
management , transfer of technology and intellectual property (article 15-A, sole paragraph,
section VII, of the Innovation Law).
These actions are important in providing the elements and information needed by public
researchers and managers, while fostering the entrepreneurial culture in public ICTs. As already
pointed out, the ICT innovation policy should be managed by the corresponding NIT (Article 16
of the Innovation Law). It is also worth mentioning that the new S & T Legal Framework
reinforced the mechanisms for sharing and allowing the use of infrastructure, equipment and
human resources of public ICTs by other ICTs and / or companies.
It is not only a question of selling services, but also enabling professionals to work in companies
or ICTs (Article 14 of the Innovation Act) or allowing public researchers to apply for a license to
open companies (article 15 of the Innovation Law ). The guidelines for this relationship must be
defined in the innovation policy of each ICT, to be implemented and observed by the NIT.
It is important to note that, even in these successful cases, the university structure ends up
hampering the operational autonomy of the new institutions, both in terms of budget and in the
allocation of human resources. The possibility of NITs being constituted as a legal entity of their
own, according to the new S & T Legal Framework, can mitigate such problems by giving them
greater operational autonomy to manage resources and hire people (Brazil, 2015).
Technology-based Incubators
In a study carried out in 2019 through a partnership between Anprotec (Associação Nacional de
Entidades Promotoras de Empreendimentos Inovadores) and the National Council for Scientific
and Technological Development (CNPq) and with the Ministry of Science, Technology and
Innovations (MCTI) whose title is “Mapping the Mechanisms for the Generation of Innovative
Enterprises in Brazil”8, the panorama of incubators in Brazil is described in detail.
The mapping recorded a total of 363 incubators active in the country, with a greater
concentration in the Southeast (132) and South (100) regions of Brazil. São Paulo is the state
with the most incubators, followed by Rio Grande do Sul, with 57 and 40 incubators,
respectively.
Despite this significant presence, several authors point out limitations on support for innovative
entrepreneurship, through incubators. Tamásy (2007), for example, points out four criticisms:
(a) incubators would have a low effect on fostering entrepreneurship; (b) incubators would not
increase the company's probability of survival, innovation and growth; (c) its costs would be
8
https://anprotec.org.br/site/wp-
content/uploads/2019/09/Mapeamento_Empreendimentos_Inovadores.pdf
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