Do you wear contact lenses? Do you sweeten your tea or coffee with sugar cubes? Do you have a lightning rod on your roof? If the answer to these questions is yes, then you have benefited from Czech inventions. The Czechs are naturally innovative and the Czech Republic, while comparatively small, has always been big on creativity and has given the world any number of ideas. Both tourists and business visitors to the Czech Republic are often taken aback by the technological capabilities and knowledge that exists here.

The legacy of Communism has paradoxically helped to foster innovation. From 1948 up to 1989, the opportunities for free travel, overseas study, exchange of ideas and free trade were severely limited. However, Czech scientists and technicians showed great ability to improvise and innovatively use the scarce resources available and create technologies which spawned thriving industries in chemicals, plastics, pharmaceuticals and aviation.

The history

However, decades of totalitarian regime and a history of a long-manipulated nation has left a scar on people's entrepreneurial drive. Today the incubation industry faces the ‘the syndrome of low hanging fruit’ with clients who have little ambition. Those who strive to build global companies and have big dreams are faced with an inflexible bureaucracy, rapidly-changing laws and the inevitable corruption. In fact, it is often the quality of public institutions itself which causes the biggest hiccups in the Czech Republic, in comparison with leading innovation-driven economies, according to the Global Competitiveness Report 2011-12. However, in the last two years the term ‘start-up’ has become trendy in Czech media. The hunger for success stories is growing and with the arrival of the government-supported seed fund it would seems that the Czech Republic has woken up to entrepreneurship possibilities. Up to that point, incubators had been mainly built with support from European structural funds. Now they have to use this potential and transition from providing cheap premises to providing high quality services that enable young businesses to grow and expand into foreign markets. Certainly, one of the biggest challenges facing entrepreneurs is an egalitarian culture within a society that is almost afraid of ambitions, and in some cases ashamed of it.

 

The current scene

Today, there are some thirty science and technology parks and innovation centres in the Czech Republic and nearly 20 more at various stages of development. While the majority of the companies located in the parks are small Czech start-ups and spin-offs, foreign companies can also benefit from being in these spaces. Over the last several years, there has been a massive growth in the number of clusters set up by Czech companies in cooperation with universities, with both public and private research institutes, to collaborate on technology and knowledge transfer, training and export promotion. Nearly 20 such clusters exist and they focus mainly on engineering, plastic technologies, biotechnology, nanotechnologies and IT.

The first incubator originated in the Czech Republic soon after the Velvet revolution as a part of the EBN network. Even though some more came into existence in the 90s, incubation was not given much importance in Government policy, and private funds were not mature enough for similar capital investments. The incubation boom came with the Czech Republic's EU's membership, which ushered in the possibility of bringing investments to building spaces from available structural funds. With the help of the government budget it was possible to build a strong infrastructure across the whole country within a few years. Due to the fast growth, the expansion of services was unrestrained and different regions showed a great contrast not only in the scale, but also in the quality of the provided services.

 

Points to note

It was important for these centres not to compete with each other within the newly established ecosystem. This was successfully managed with an implemented functional regional strategy. A good example is the South Moravian region, which established its Regional Innovation Strategy in 2001 - the first to do so, and as a result, 6 leading centres have evolved. They have been working together closely and have become trend-setters in a swiftly-evolving incubation industry in the country. But even these leading incubators are facing a lack of qualified professionals, which is caused by the short history of incubation and development of start-ups in the Czech Republic. It is vitally important therefore that the capacity of the current experienced experts is used in the best way possible. Successful centres are expected to fill their spaces with high quality services and to participate more in the partnership and communication with others.

Various types of funding are possible. Some centres have been established within university grounds, frequently by the region or the city. Quite rarely does the establishing company comes from the private sector. An interesting example is the South Moravian Innovation Centre which was co-founded by four universities, the city of Brno and the South Moravian Region. It succeeded not only nationally, but was recognised internationally at The Best Incubator Award in 2012, where it was third in 'The Best Internationally Connecting Incubator'. Such accomplishments show that widespread institutional consensus across the region can enable high quality services, on par with international standards. At the moment, domestic and foreign awards are the only way to evaluate the work of individual incubators. In order to further evolve and develop the incubator network in the Czech Republic, it will be necessary to establish a certain evaluation system across the entire country; leading incubators have already created their own internal evaluation system, which could serve as a good starting point.

 

Areas of interest

Despite of a great variety of industries present in the Czech Republic especially the less developed regions, the leading incubators focus on the key specialisations in the Czech Republic: ICT security, biotechnologies and nanotechnologies, as these are the strongest areas of top research in the Czech Republic. ICT generally is a relatively young sector in the Czech Republic. Most of the mature ICT companies were founded in the 1990s and have been engaged in industrial process; automation and control, electrical engineering, system integration and development of diverse software solutions and information systems. ICT Security research is particularly strong in South Moravia, being home to several companies specialising in anti-virus software, network traffic monitoring and analyses, data security solutions, speech processing and secure communication. According to the latest OPSWAT report, almost 40 percent of the global antivirus market is controlled by AVAST Software, ESET and AVG Technologies, companies whose original research is connected to South Moravia. One of the most promising start-up companies include INVEA-TECH, a spin-off from Masaryk University and Brno University of Technology, who are specialised in network and security solutions. The latest Gartner report recognises INVEA-TECH as one of the eight Network Behaviour Analysis vendors worldwide; the only one located in Europe.

The Czech Republic is keeping pace with world progress in biotechnology as well. While just ten years ago, biotechnology was practically non-existent in Eastern and Central Europe, skilled labour, relatively low costs and the tradition of conventional technologies in beer-brewing and the manufacture of antibiotics have assisted in its development along with a tradition of very strong systems of education and research. South Moravia, a region recognised as the most innovative pioneer in business incubation in the Czech Republic, is an excellent example of the emerging biotechnology sector as well. In South Moravia, biotechnology is seen as one of the most promising branches in the Region, an area in where a number of interesting projects have already been launched. The two most important are the International Clinical Research Centre (FNUSA-ICRC) and the Central European Institute of Technology (CEITEC). Some 10,000 students are enrolled in Biotechnology courses and another 20,000 students in technical branches reliant on biotechnology expertise. Brno's research teams, specialising in structural biology, protein engineering and the study of stem cells, rank among the ‘absolute world elite’. The South Moravia Region has set itself an ambitious aim: to be among the first 50 most innovative regions in the European Union by the year 2013. Biotechnology is to play an important role in this respect.

 

The hope is...

There is no doubt that the Czech Republic has made enormous progress, especially in recent years, in harvesting its entrepreneurial capabilities. But there is always room for improvement. Recently, the government announced it would open its seed fund in 2013 and provide seed capital of €53 million to early-stage start-ups - these funds will be provided mostly by the EU. With this level of support and backed by a historically rich tradition of technical expertise, the only thing Czechs need right now is a better quality of government institutions that will enable fair play to those who dare to dream about turning their ideas into thriving, sustainable businesses.

 

INTERVIEW

In conversation with Ji?í Hude?ek, CEO of JIC (The South Moravian Innovation Centre) on the services and progress of the INBIT Innovation Park 'where innovative biotech products come into being'

Awarded as the Best High-Tech property of 2011 by the Ministry of Industry and Trade of the Czech Republic and CzechInvest, the INBIT Innovation Park, located within the premises of the campus of Masaryk University in Brno, has been in operation since 2008. The institution responsible for its operation is the South Moravian Innovation Centre (JIC).

INBIT is one of the projects of the South Moravian Region which has set itself the target of occupying the 20th position in every high-tech specialisation by the year 2020. Its purpose is to help innovative biotechnological firms and related companies reach their full potential.

 

What does INBIT offer to businesses?

The purpose of the INBIT Innovation Park is to concentrate in one place, different tools of support for start-up firms with innovative aims before they can stand "on their own feet". The basic element of the system is comprehensive services. INBIT offers modern offices and laboratories, pleasant surroundings and top-standard technological equipment over an area of 2,957 square metres. For companies, entry into the Innovation Park also means financial savings, as they can use their money directly for the development of their product, instead of high rents, and complete product development sooner than they would otherwise be able to. To businesses that do not require office space, but want to use the other services of the Innovation Park, JIC offers ‘virtual rent’. A company can rent one square metre of an office area at a symbolic price and use all the advantages offered by JIC.

 

What projects are currently under way at INBIT?

INBIT currently provides working ground for 15 companies, many of which supply unique products. For example, the Park is the seat of Imuna CZ, a company dealing with the innovation of anti-staphylococcus lysate used in medicine as a local preparation for the treatment of staphylococcus infections. There is Enantis, a biotechnology company focused on development in the area of enzyme technologies and protein engineering for biomedicine, environmental protection, agriculture and the military defence sector. The company has developed a method of liquidating the dangerous mustard combat gas with the help of enzymes. Enantis came into being as a spin-off, in close collaboration with the Loschmidt Laboratories at Masaryk University in Brno. Another company is Pharmaceutical Biotechnology, which was founded in 2008. The company focuses on the development and production of new generation of biofilm probiotic products - a revolution in probiotic products. It also concentrates on the development and production of stabilized probiotic cultures. Recently, they have introduced a new generation of female sanitary pads to the market, with the content of stabilized probiotic cultures; the only product of its kind available.

 

Do you collaborate with similar associations abroad?

JIC collaborates with a number of foreign entities, in both the business and academic arenas. JIC is also a member of a number of international networks, such as Enterprise Europe Network, which provides consulting services in Europe not only for small and medium-sized enterprises, but also for research institutes, universities, technological centres and business and innovation promotion agencies. Clients include the European Business and Innovation Centre Network (EBN), UK Business Incubation (UKBI), ACHIEVE MORE Partnership, International Association of Science Parks (IASP), Innovating Regions in Europe (IRE), etc. Proof of the internationalisation of the JIC Innovation Park is its third position in The Best Incubator Award Competition in the category ‘The Best Internationally Connecting Incubator 2011’.

 

Can you see any strong trend influencing the biotechnology sector?

There are many such trends evolving today. Much depends on the specific area. In the environmental protection area, new waste-water treatment methods are quite remarkable. In the chemical industry, the more environmentally-friendly and more economical syntheses of substances, in health care, the area of molecular diagnostics and personalized medicine, and in the power industry, the bio-fuels issue, among many others, are noteworthy. Perhaps a general trend is the gradual penetration of biotechnologies into other branches of industry.

 

Helena Tovarkova has a qualification in media communications, public relations and environmental studies and has  published on  issues of corporate social responsibility in the Czech Republic focusing mainly on its environmental perspective.  She has a background in radio and newspapers as reporter and editor  and specializes in media relations. As a Communications specialist, she helps start-ups at South Moravian Innovation Centre to project the right message to the media and wider public. She uses friendly, narrative approaches to make the stories behind the technological companies  widely understandable.