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Presentation on theme: "Company LOGO TECHNOLOGY COMMERCIALIZATION IN UKRAINE October 2006."— Presentation transcript:


2 PRESENTATION OVERVIEW Technology Commercialization Challenges Global IPP/USIC Model Initiatives for Proliferation Prevention Projects in Ukraine

3 COMMERCIALIZATION Of Science and Technology CHALLENGES AT A GLANCE The process is high-risk, long-term, multi-stage, and complex. You have to deal with a funding gap at the early engineering and commercialization stage In the U.S., the amount of venture capital available for investments has declined since 2000 bubble Commercialization investment portfolio –Only a few Hits will generate high revenues –A number of others will generate smaller revenues –Most endeavors do not attract outside investment

4 The Process of Commercialization Research and Development Engineering to a prototype Raising capital Manufacturing Marketing

5 Research and Development There is a large number of scientists and engineers in Ukraine doing research that they believe is marketable The Science and Technology Center in Ukraine (STCU) supports a number of research projects, focusing on those with practical applications Partner projects such as IPP focus on efforts likely to lead to commercialization

6 Engineering to a Prototype It is necessary to take the results of R&D and engineer it into a product that can be mass produced. This takes investment. It is important to attract a company and/or an investor at this stage so that someone familiar with the market is involved For example, the focus of the IPP program is on this phase

7 Raising Capital This is not an easy task Large amounts of investment are required before a product hits the market The amount of investment money invested in science has decreased over the past 5 or so years (at least in the U.S.)

8 VALLEY OF DEATH Valley of Death – funding gap at survival stage Time $ Cash flow or sales Technology Creation Biz. and Product Development Commercialization Idea, R&DProduct Dev. Production Distribution Sales Valley of Death Entrepreneur, angel investors Venture capitalists Stock owners R&D grants, Public sector IdeationSurvival Growth Cash flow Sales

9 VENTURE CAPITAL INVESTMENTS (US) Source: Pricewaterhouse Coopers & National Venture Capital Association

10 GLOBAL PRIVATE EQUITY 2004 Source: Pricewaterhouse Coopers & National Venture Capital Association

11 Top 20 Countries Based on High-Tech Investment (2003) North America 1. USA ($19.54) 2. Canada ($0.81) Western Europe 2. UK ($4.76) 4. France ($1.75) 5. Italy ($1.53) 8. Sweden ($0.82) 11. Germany ($0.76) 12. Ireland ($0.29) 13. Finland ($0.21) 14. Norway ($0.21) 15. Netherlands ($0.19) 16. Denmark ($0.16) 17. Switzerland ($0.16) 19. Spain ($0.15) Asia Pacific 3. Japan ($2.51) 6. Korea ($1.11) 7. China ($1.06) 18. Singapore ($0.16) Middle East & Africa 10. Israel ($0.77) 20. South Africa ($0.13)

12 How does the United States help with the Start-up of new Technology Businesses? Small Business Innovative Research Program (SBIR) Advanced Technology Program (ATP) of the National Institute of Standards and Technology (NIST) University technology transfer offices –Technology licensing to businesses –Business incubators Angel investors, venture capitalists, stock owners

13 CHALLENGES IN UKRAINE Lack of public resources –R&D stage –Commercialization/survival stage (valley of death is deeper) Lack of venture/private investment resources –Ukraine is below the radar of global private equity investment in high-tech Domestic high-tech market limited –Most customers were military in the past Lack of tech commercialization expertise and infrastructure in research institutes (unlike in Western universities)

14 US NONPROLIFERATION PROGRAMS: SUPPORTING UKRAINIAN SCIENTISTS STCU –R&D grants/civilian engagement since early 1990s –Compensating for lack of public R&D funds in Ukraine –STCU Commercialization program CRDF –R&D grants/civilian engagement –Next Steps to Market

15 DOEs Global IPP PROGRAM: INDUSTRY PARTNERSHIPS Commercialization & industry partnerships focus Critical element: US company participates as industry partner in each project Industry partner matches 100% of federal funds Industry partner provides business expertise/ direction and brings technology to the market US Company provides access to Western investment resources (80% of global private equity)

16 Projects Model Three-way partnerships: –Ukrainian institute, U.S. company, and DOE national laboratory IPP funds FSU scientists work U.S. companies cost-share government funds by cash and/or in-kind resources National laboratories funded by IPP to validate the Ukrainian science and technology technology validation and to help manage the project

17 Benefits for Ukrainian scientists Access to U.S. business expertise and investment resources –Invaluable lessons to learn Partnerships created with U.S. companies –Combining Ukrainian technological resources with U.S. entrepreneurial expertise Development of technologies, products and services for U.S. and global markets –Ukrainian high-tech market is limited –U.S. companies provide access to their markets and customers Working with top U.S. national laboratories in joint tech development JOBS, REVENUES, INVESTMENT, NEW JOINT AND OWN BUSINESSES CREATION

18 United States Industry Coalition (USIC) Association of 150+ U.S. companies –Multinational corporations – General Electric, Boeing, DuPont, Halliburton, IBM, Westinghouse, GNF, Nukem, Brush Wellman –Small innovative businesses Advisor to NNSA/DOEs Initiatives for Proliferation Prevention Program (IPP) –IPP project review/monitoring –Facilitation of technology commercialization –Public/Congress outreach Provides an industry outreach for IPP –Member companies are industry partners of IPP projects Over ten year experience in technology commercialization and partnerships in the FSU region

19 COMMERCIALIZATION SUCCESS Sustainable civilian occupations steadily grow –2,800 civilian FSU jobs created/sustained –16,000 scientists engaged by IPP since 1994 US+FSU Revenues surpassed IPP budget since 2003 –$30M vs. $22.5M IPP budget in FY03 –$53M vs. $23.8M IPP budget in FY05

20 COMMERCIALIZATION SUCCESS Outside investments demonstrate high competitiveness of technologies –$137M invested by the end of 2005 FSU institutes catching on commercial culture: –30 FSU and FSU-US businesses created/sustained –Negotiations with customers & investors; FDA and FSU certifications; establishing manufacturing; int. patents; etc. 30 % of projects generate revenues to date –Many more resulted in other successful developments

21 Ukrainian Projects Supported by IPP 19 Ongoing & Completed Projects in Ukraine Examples of Successful Ukrainian Projects Supported by IPP : Welding & Brazing Technologies for Repair of Turbine Engine Airfoils Advanced Grinding Technology for Bio-source Materials Advanced Welding & Fabrication Techniques for Al-li Alloys Next Generation EB-PVD Apparatus Flash-butt Fusion

22 Welding & Brazing Technologies for Repair of Turbine Engine Airfoils Repair of worn or defective turbine components made of nickel-base superalloys is difficult and expensive Innovative technology reduces repair costs, allows re-manufacturing of initially defective, and refurbishment of used, components Manufacturing started. Restoration repairs of aero engine parts Pratt & Whitney / UTC (CT) E.O. Paton Electric Welding Institute (Kyiv) Oak Ridge National Laboratory

23 Advanced Grinding Technology for Bio-Source Materials Agricultural/forestry waste can be converted into consumer and industrial products –Fillers for plastics; chemicals; fuel; electricity; animal feed; fertilizer Global demand for bio-source products surging –$23 Billion market growing at 9% per year Ukraine plant has expertise in particulate reduction, analysis and system design techniques Unique grinding & separation technology for global industrial and agricultural markets Pinnacle Technology (KS) TexMet (Dniepropetrovsk) NNSA Kansas City Plant

24 Advanced Welding & Fabrication Techniques for Al-Li Alloys Boeing (CA) VNIITF (Snezhinsk, RU) E.O. Paton Institute (Kyiv) Lawrence Livermore Natl Lab Russian, Ukrainian & U.S. partners will design, analyze, fabricate prototype aircraft & launch vehicle components Lightweight extruded panels reduce cost, improve performance Growth in commercial aerospace design & manufacturing Significant annual sales, dozens of people employed (numbers proprietary)

25 Next Generation EB-PVD Apparatus Innovative design improves commercially-available systems –Higher deposition rates –Reduced time & operating costs Ukrainian partner will be able to compete in global market for multiple industries –Aeronautical & gas turbines –Fuel cells –X-rays systems General Electric Company (NY) E.O. Paton Electric Welding Institute (Kyiv)

26 Flash-Butt Fusion (FBF) FBF applied in 55,000 km of pipeline worldwide Technology in use for 30+ years FBF advantages: –bonds any metal to any other metal –uses electric contact rather than welding rod or flux –faster welding rates –strong, high-quality welds –higher labor productivity Oil, gas, chemical pipelines & storage tanks are primary market for upgraded FBF Maverix (FL) E.O. Paton Electric Welding Institute (Kyiv) NNSA Kansas City Plant

27 List of IPP Projects in Ukraine ANL-T UAPhotonuclear production of radioisotopes ANL-T UAProcess Development: Low Cost, Continuous Nano-Scale Purification Technology of Powdered Carbonaceous Materials for Applications in Electrochemical Energy Storage Systems and Electroconsolidation Process Technology ANL-T UAThe Use of the MAG*SEP Technology for the Decontamination of Milk, Juice, Baby Food, and Water from the Chernobyl-Affected Zone in the Ukraine DOEH-T UANext Generation EB-PVD Apparatus KCP-T UAAdvanced Grinding Technology for Bio-Source Materials KCP-T UAFlash-Butt Welding KCP-T2-0222A-UACustom Automotive Component Manufacturing LBNL-T UAScreening of Botanical and Fungal Species Collected within the Territory of NIS for Pharmaceutical and Agrochemical Activities LLNL-T UAJoining Technologies for Gamma Titanium Aluminide Castings LLNL-T UAHigh Specific Stiffness Shafts and Advanced Bearing Coatings for Gas Turbine Engines. LLNL-T UARadiation Hardened Telerobotic Dismantling System Development ORS-T2-204-UAWelding and Brazing for Repair of Aircraft and Gas Turbine Engine Components ORS-T2-211-UADevelopment of Protective Coating Technologies for Gas Turbine Engine Airfoils PNNL-T UACost Effective Production of Powder Metallurgy Titanium Components for High Volume Commercial Applications PNNL-T UADevelopment of a New Lithium Metal Secondary Battery with Polymer Electrolyte and Cathode Based on Metal Oxides PNNL-T UADevelopment and Commercialization of Straw Fired Boilers of kW in Ukraine PNNL-T UAEmpirical Discovery and Development of Crop Protection and Human Health Agents PNNL-T UACommercial Application of Europium for Gamma Irradiation in Ukraine & Russia SNL-T UABrazing Process Improvement for Stainless Steel Tubes

28 Marketing Ukrainian Technologies Ukrainian technologies are marketed to U.S. industry through IPP. Marketing vehicle - BISNIS, U.S. Department of Commerce TekhInvest, Ukraine identifies promising technologies from Ukrainian institutes USIC facilitates interactions between institute and U.S. companies –U.S. company due diligence

29 USIC Working through BISNIS 1.Amorphous and nanocrystalline tape-wound magnetic cores with high temperature stability of magnetic characteristics, Melta Ltd. 2.Plasma surface hardening of flanges of wheels of locomotives, as well as passenger and freight cars, RPE Topaz Ltd. 3.Holographic Coding Method to Produce Surface-Relief Holograms Incorporating Image that Is Recorded as a True Hologram, Spekl 4.Vortex Bubble Contactor for Intensification of Heat and Mass Transfer in Various Industries, Institute of Engineering Thermophysics 5.Ukraine Production of Nanodiamonds and Development of their Application Technologies, Sinta Ltd. 6.Chitin Adsorbent for Heavy Metals and Radionuclides; Technology for Liquid Industrial Waste Decontamination, Mycoton-Aglycon, Ltd. 7.Vehicle-Borne H2-Producing Rechargeable Feeder for Hydrogen-Propulsion Automobile, Scientific Research Power Engineering Institute of Dnipropetrovs'k National University 8.Gas-Thermal Jet for Surface Treatment and Coating, Kyiv National Taras Shevchenko University 9.High Efficiency Photo-Electrochemical Hydrogen Production and Storage Cell, Institute for Problems of Materials Sciences 10.Liquid Crystal Alignment Method, Institute of Physics of National Academy of Sciences of Ukraine 11.Magnetocardiograph - Early Detection Of Ischemic Heart Disease, Kharkiv National University 12.Superheated Vapor Impregnation of Capillary-Porous Materials, Pridneprovie Cleaner Production Center 13.Vibrato-Diagnostic Imaging for Security Monitoring / Power Generation from Agricultural Industry Waste / Flame - Jet Drilling System, Yuzhnoye State Design Office 14.Copper Scrap Recycling Technology, East Ukrainian National University 15.Brazing and Diffusion Bonding of Metals to Non-Metals, Frantsevich Institute for Problems in Materials Science 16.Advanced Acousto-Optical Modulator for Powerful Laser Radiation, Institute of Physical Optics 17.Pneumatic Washing & Cleaning Technology for Machinery Parts, National Science Center / High Critical Current Density Niobium-Titanium (NB-TI) Superconductors, Kharkiv Institute of Physics and Technology

30 Conclusions and Questions International institutions such as the STCU and programs like IPP are creating new, sustainable jobs for WMD personnel in Ukraine. They are adding new jobs to U.S. and Ukrainian economies IPP & STCU help reduce risk for U.S. high-tech business Similar institutions and programs could accomplish the same There is a need to attract significant private investment to new technologies What role is the government of Ukraine willing to play to add to the current successes, to attract outside investment, and to lay the foundation for a high tech economy in Ukraine? To what extent are outside governments and companies willing to continue, is not increase, the level of support for the commercialization of Ukrainian science?


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