The National Innovation Agency (NIA) has revamped its financial support measures by focusing more on assisting recipients in bringing their products to market, a shift from helping those with potential to develop prototypes.
The state agency allocated funding of 300 million baht this year to support startups, small and medium-sized enterprises (SMEs), social enterprises and community enterprises, aiming to generate 3 billion baht worth of economic and social impact, rising to 10 billion by 2027.
Its co-funding efforts with venture capital (VC) firms and corporate venture capital (CVC) firms is expected to be key in driving funding growth for the seed and Series A stages for startups, said Krithpaka Boonfueng, executive director of the agency.
She said for fiscal 2024, the NIA has shifted its financial and funding support programmes from R&D and prototypes in the early stage to focusing on the growth stage for products for SMEs and startups.
Ms Krithpaka said the agency will also focus more on pushing products to go to market, product testing, market testing and product improvement after the product launch in the market.
She said enabling wider access of funding is one way to strengthen Thailand's innovation system.
"This will ensure that we support innovation that can generate income, including export capability and create impact value to the economy and society."
The NIA mainly focuses on target sectors in five areas: agricultural food and herbs, healthcare and medicine, tourism, soft power, and the environment and electric vehicles.
With its 300-million-baht financial scheme, the agency expects to generate social and economic impact worth 3 billion baht, said Ms Krithpaka.
Sura-at Supachatturat, the newly appointed deputy executive director of the NIA.
Sura-at Supachatturat, newly appointed deputy executive director of the NIA, said this year it will focus on promoting economic innovation, followed by social innovation next year.
The new financial support will cover corporate co-funding by supporting the funding in the seed to Series A phases for startups that raise between US$1 million and $10 million. The NIA will co-invest a maximum 10 million baht per project and 50% with VCs, CVCs and private equity trusts.
"The NIA will not take any shares in that startup. When they make profit or raise funds in the next round, they will have to return our funding and we will invest for a maximum five years," he added.
At this stage, the NIA partners with the Thai Venture Capital Association and it welcomes foreign partners, particularly foreign VCs, as China's economic slowdown and conflict in the Middle East have prompted VCs to shift their focus to Southeast Asia, including Thailand.
Mr Sura-at said the NIA expects to increase innovation based enterprises (IBEs) and business growth in targeted areas. By 2027, it aims to have 10,000 IBEs and 1,000 growth stage enterprises with an economic impact worth 10 billion baht.
The NIA has seven mechanisms to support its funding. One is for market expansion for testing innovations in the private and public sectors.
It will grant funds at 100% of the project's value to state agencies projects and 50% of the value for projects of private organisations, or not exceeding 2 million baht per project for one year. This will enable them to commercialise products to targeted customers.
Another mechanism is to help recipients ease their working capital interest payments. It will extend funds not exceeding 75% of the working capital interest and related fees, or not exceeding 1.5 million baht per project for one year.
In addition, the agency has mechanisms for testing product standards which will offer grants not exceeding 50% of the project's value or not exceeding 1.5 million baht per project for the developers to hire consultants, improve their organisational working process, conduct product tests and analyses and product evaluation. All these are to support their applications for product certification.
The NIA will also offer funds to manage innovation development. The funds will not exceed 50% of the project's value, or no more than 1 million baht per project to hire consultants to improve their working process in terms of marketing strategy, intellectual property, accounting, investment and international trade.