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Former CEO fuels chemical start-up growth.
07 July 2016
Recipient of the ‘Commandeur de l’Ordre de la Couronne’ (Belgium’s highest accolade) and former CEO of Petrofina, François Cornélis, is now “having lots of fun” with chemical start-ups as Chairman of the Essenscia Innovation Circle and Innovation Fund.
After Petrofina was acquired by Total, François became President of Total Chemicals and Vice-Chairman of the company’s executive board. Now within his new role, he identifies promising new business ideas (rooted in a good IP strategy) that may create value and employment in the European and Belgian chemical industry.
Here, François tells 4iP Council what innovative European start-ups often lack and explains how he and his CEO friends are working together to fill this gap.
What motivated you to establish the Essenscia Innovation Award, Circle and Fund?
We wanted to recognise and support chemical companies that have developed strong ideas based on original intellectual property.
It started with the Essensica Innovation Award in 2012, set up within Essensica (the Federation of the Belgian Chemical Industry) and grew from there. This led to the creation of the Circle in 2013 and the Fund in 2015.
It has grown steadily and we currently support around 20 start-up projects and are closing our third investment round for the Fund. We focus on chemical start-ups located within a 400km radius of Brussels.
How does the Circle work?
The Circle is effectively a club of thirteen ex-CEOs from the chemical industry whom I invited to work with me. I got a good response! Nearly all the people I contacted accepted the challenge.
Together we help innovators find suppliers, subsidy, customers and advise on the general management of their business.
We meet monthly and discuss two ventures per meeting. Essenscia helps us in terms of administrative support and we also benefit from the support of Leuven University as well as fifty days consulting time gratis from Deloitte and Touche.
The best projects that we support need financing so, through my contacts, I have managed to develop an Innovation Fund currently worth 20 million euros. Now the Circle can send a project to the financing committee, which draws on this Fund.
Our motivation is to help and nurture people who are investing their lives in innovation. Our hope is that we are setting an example that will encourage others to do the same.
What were the drivers behind the creation of the Circle and associated activities?
First, the chemical sector is very large in Belgium due to the high volume of activity at Antwerp port. However, we feel that the sector is at risk from the huge investments in the US and in the Middle East. This could pose future problems for the sector in Europe and there is a consensus that we need to invest in something else.
Second, large corporations conduct a lot of research but they do not discover as much as start-ups and smaller research teams. People tend to be more daring and innovative in small companies. Larger companies are likely to take over from start-ups where there is a need for faster development and marketing.
Third, we are in a period of enormous intellectual and scientific renaissance and young people are relatively well prepared for it. There are people willing to dedicate their lives to research and innovation and I believe those who have experience in business should support them.
What role does IP play in the Circle and Fund?
We get free support on IP from Essenscia’s dedicated team. The patenting element is essential for us. One of the criteria we have for financing a project is protection of their IP. You have to be unique in some way to be successful but if you are unique, you are not unique for long.
Do you think weakening or dismantling the patent system could benefit European companies?
Certainly not. If you want people to make a sacrifice you must reward them accordingly. I admire the persistence of people in start-ups. It would be a disaster to expose them to copying. Patents are an essential element for innovation.
Have you seen an evolution in the way companies innovate?
The change is colossal. We are moving from a world where discovery largely took place within the corporation into a world where large corporations are buying discoveries made elsewhere.
Large corporations have realised that the production of ideas from their own labs is not sufficient. They are increasingly investing in funds specialised in innovation and new ventures to have a broader view and to be able to jump on a train that interests them if it is passing by. It is now about being in pole position when something significant comes up.
What advice would you offer a start-up today?
First, you have to have a business plan. You need to know how people will use the product you have developed and in what volume it can be sold. Also, you need to know how to sustain growth and have a structure to support that growth.
Second, your innovative character needs to be clear. Is your idea patentable? If an idea is not patentable then we don’t believe it will go far in terms of earnings.
Third, you must have a well-conceived management structure.
How can we foster more innovation in Europe?
What we are doing with the Circle and Fund is exactly what I believe needs to be done to foster innovation - we are using free expertise from experienced business people to help and support young entrepreneurs.
Of course, early stage investment is risky but the money is now available, so in my view, funding should not be an issue. The world is not lacking in ideas or entrepreneurs but they have little life and business experience. Business people, like the people who make up the Circle, need to provide complementary expertise and connections.
What role can policymakers play?
Given the level of experience in Europe, we need to be at the forefront of technology to have the highest added value. This value will come through innovation in all of its forms - in products, solutions and methods of doing things.
Policymakers must therefore support our universities to foster quality research and ensure professors are capable of enthusing the young people around them.
Governments should also make sure that laws are applied and that patenting means something. Industry has had an issue with copying by the Chinese. Protecting intellectual property is part of the EU’s role.
Author: Emma Bluck
The views expressed in this feature are those of the interviewee and may not reflect the views of 4iP Council or its members. The purpose of this feature area is to reflect thinking on the topic of intellectual property and enable open discussion.