Formation of Venture Business Clusters by Strategic Competition Policy in Germany : EXIST (business startup by universities) and BioRegio (formation of bioindustry clusters)

Abstract

German universities has recently been starting 2.5 times more new businesses than American counterparts. The number of biotechnology firms in Germany has exceeded that in Britain and now at the top in Europe. A major factor in these developments is the German Government's initiative in strategic development of venture startup models. The present paper discusses two examples of the policy: EXIST (startup of regional businesses from the academic circle) and BioRegio (establishment of biotechnology clusters). EXIST introduced business culture into universities, which have traditionally been associated with administration, by establishing relevant courses, to form regional networks supporting business startup in cooperation with local governments and business circles. Activities through the network include business planning competitions, consulting on business startup, contact with financial organizations, and publicity. BioRegio has also created regional networks in areas most promising for development of bio industry clusters to support local activities. Sizable amounts of the Federal grants for research and development were targeted on those areas. The two projects share features such as competition system to foster and select businesses on which support is focused, and autonomy of the areas. The German policy suggests much for planning venture and regional economic policies in Japan.