1. Presentation to Royal Society of New Zealand Peter Benfell 23 June 2004

2. 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?

3. Investment Funds 2004/05

4. 19 Portfolios RFIMKDOCNERFENVSOC SEGSustainable Economic GrowthRPMRangahau Putaiao Maori INFInnovative FoodsFHTFuture Human Technologies MANManufacturing Processes, Products & MaterialsNPTNew Physical Technologies NBPNiche Biological Products & ServicesNZTTechnologies to Leverage NZ’s Strengths NSUNetworks, Structures & UtilitiesGLOGlobal Environmental & Earth Processes Change PQAPrimary Production, Quality & AssuranceECOResilient, Functioning and Restored Natural Ecosystems RICResilient Infrastructure & communitiesSCSBuilding Sustainable Cities & Settlements SPSSustainable Productive SystemsSRUMaintaining Environmental Integrity for Sustainable Resource Use SERBuilding Knowledge-Intensive Service IndustriesBISBuilding an Inclusive Society PRUOptimising Use of Physical Resources

5. 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 UntargettedBasic TargettedApplied Experimental Development Product Development

6. 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 UntargettedBasic TargettedApplied Experimental Development Product Development

7. Range of Providers

8. 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

9. 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)

10. “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

11. 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

12. Co-funding of our research investments

13. 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

14. 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

15. Technology NZ Invest in private sector companies to enhance technological capability Usually 50/50 co-funding Foundation investment of $50m pa

16. 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

17. 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