Innovation is the best investment for the state

Posted in: News- Mar 17, 2017

Belgrade, March 7, 2017 – The government is not an innovation player, but an innovation enabler: it has to provide a framework in which innovations are to develop, says Shuki Gleitman, an Israeli innovation expert, in his lecture delivered today at the Science and Technology Park Belgrade.

From his decades-long experience as one of the creators of the Israeli innovation strategy, Gleitman shared with the local audience of entrepreneurs his thoughts on financing innovation and the state’s role in shaping and developing the innovation ecosystem, and supporting innovators.

Gleitman, strategic advisor to the Innovation Fund since 2011, and co-owner of the Israeli venture capital fund for “Platinum,” said the innovation ecosystem must be seen as a chain whose links are all of equal strength. The responsibility of the state is to provide support to innovative entrepreneurs in the early stage of development, when the risk is greatest.

Putting the taxpayers’ money in innovation is not only a secure investment but a profitable one, too. Israeli data indicate that the state’s return from the investment in innovation is five-fold within – in the form of taxes – in 5 to 7 years’ time.

In addition, investment in innovation leads to new jobs, development of a modern, flexible economy, the best way to ensure competitive advantage of the national economy and a good international reputation.

“In short, this is the best investment a country can make,” he said. Even if the company fails, the state has benefited because people have been trained, intellectual property has been created, so that the loss for the taxpayer is practically non-existent.

The state’s role in supporting innovation is clear: it should provide infrastructure and legal framework, education and the application of research and development, financial instruments of direct investment, risk mitigation, good business environment, and an efficient bureaucracy.

In addition, it is necessary that the state should support and encourage a continuous development of the ecosystem, ensure the macro conditions which support company growth – and all of this has to be a long-term commitment, Gleitman said.

For the integral version of the lecture, please go to link