How the HQA® Program is Improving Investment & Entrepreneurship in Portugal
If Portugal is to realize the full potential of its innovative entrepreneurs, it needs to attract investment in…
If Portugal is to realize the full potential of its innovative entrepreneurs, it needs to attract investment in both its projects and its people from outside the country’s borders.
That’s the common theme that emerged as business leaders, accomplished entrepreneurs, university officials, and researchers all shared their views on the current state of Portugal’s innovation ecosystem at the “International Talent for Innovation” event. The impressive collection of individuals assembled in Coimbra also agreed that the HQA® Program is a unique catalyst for fueling this investment as it introduces both the financial and human capital necessary for converting Portugal’s potential into reality.
“At a national level, we lack this type of investment, and this is a way to show it, to show the government, to show the national authorities how to do it. How to do it efficiently and how to do it in a more assertive way,” declared Nuno Mendonça, Vice Rector at the University of Coimbra, which has successfully integrated the HQA® Program into its incubator for technology transfer, Instituto Pedro Nunes (IPN).
“I strongly believe that the impacts of your investment in our research – not only in Coimbra research centers but also in other Portuguese institutions – will have its effects in the long term.”
Portugal Primed
With a robust university research system and plenty of young talent engaged in innovation, Portugal has many of the elements necessary for entrepreneurship to thrive. However, the country’s relatively small size has limited the financial resources available to those in need of funding for their startups to continue, so the past decade has seen many talented young Portuguese pursue employment elsewhere rather than opting for entrepreneurship.
Fortunately, initiatives like the HQA® Program are introducing a new crop of experienced businesspeople and investors to the country’s startup ecosystem, which offers several quality opportunities.
“Today there’s really no shortage of very good startups being born in Portugal. They’re also always born with a global mindset because we all know Portugal is a pilot for technology, and it’s a pretty good one. The infrastructure is good, everybody speaks English, digital literacy is pretty good,” explained Pedro Ribiero Santos, Managing Partner at Armilar, an early-stage venture capital fund manager.
“But it’s nothing more than a pilot, so the startups that born in Portugal are born with a global mindset, which is not always the case in other larger European countries. And that has spawned the creation of companies that have become very successful. Having said that, the capital in Portugal continues to be very, very scarce in venture. This has also opened the door to international investors to come in and invest in Portugal, which of course has a very, very positive effect.”
The HQA® Program: A Multi-Purpose Tool
Among the mechanisms for attracting international investment to Portugal is the HQA® Program, which pairs international entrepreneurs with Portuguese universities and polytechnics to launch innovative R&D projects. The novel program delivers direct investment to these research institutions while simultaneously creating opportunities for researchers and graduate students to further their academic pursuits.
“The most obvious direct impacts of our HQA® Program are largely twofold. One is the capital directed and invested directly into research at the institution. And two, the highly skilled human capital, the expertise that is brought to a project, to a university, the surrounding ecosystem, and more largely to Portugal,” detailed Chris Lennon, President of Empowered Startups.
“But our vision for the HQA® Program is so much bigger than just this obvious and also valuable twofold direct impact,” he continued. “We want to build something that generates an impact on innovation which is far greater than the sum of the direct capital investments made into research through the program.”
Business Meets Science
Lennon offered several long-term examples to demonstrate that while the immediate funding derived from the HQA® Program is important, the mentorship, guidance, and knowledge exchange provided by the experienced entrepreneurs behind the funding can create an even greater impact.
Joana Branco, the Director of Innovation and Ecosystem Development at one of Portugal’s most important biotechnology centers, Biocant Park, agreed with Lennon’s assertion and then described why this aspect of the HQA® Program is essential to driving more talented Portuguese innovators into entrepreneurship.
“Most of the time, when people talk about comparing to other ecosystems, the low costs in Portugal can be an attractive factor to bring into the country more companies. But I’ve come to realize that commitment is even more relevant. And if I would have to say one thing about Portuguese entrepreneurs, it’s their commitment,” Branco shared as she illustrated the appeal of Portugal’s startup environment for investors.
“I’m much in favor of basic science because otherwise you don’t have knowledge to create it. But that fills one gap. In this context, we’re talking about entrepreneurship. We’re talking about creating ideas to create economic value, so this input is very relevant. You need the advice; you need the experience of someone that has already done it.”
“Having experienced entrepreneurs makes a huge difference – for the ones in Portugal that have already done it, but also the ones that come from abroad with a different mindset that says, ‘Look I’ve done it in a totally different scenario, but this works because of that.’ And I think that’s what we need to take it to the next level. Seeing the same topic from different perspectives.”
Enhancing University Opportunities
What makes the founders from the HQA® Program so valuable to Portugal’s progress is their ability to impact the entrepreneurial environment at multiple levels. Their experience and resources allow many of them to invest in innovative startups with high-growth potential, and their direct interaction with universities provides the opportunity to support and mentor students with early-stage concepts that have a different trajectory than those that attract venture capital.
This aspect of the HQA® Program stands out to many in Portugal’s academic community including João Gabriel Silva, Director of IPN at the University of Coimbra.
“We do not just support the kind of company that usually venture capital looks at. Venture capital wants obviously high growth companies because they have to have some return,” highlighted Silva.
“Our mission at IPN is not to support just high growth companies. We will try to support companies with two characteristics. One is that they are innovative, and it can be in any area, not just technology, not just science. And they have to be viable, that is economically.”
“So, they have always to have sufficient income or at least have prospects of having sufficient income to be able to survive. And in that perspective, the capital for these low growth companies – relevant, they have a niche, they have a market – is a bit more difficult to find. The area where Empowered Startups works, this applied research pre-company, is really very relevant because there’s not much available there.”
Building Connection
Silva’s explanation set the stage for Empowered Startups’ Incubation Manager, Paulo Martins, to expand on that example as a means for showcasing the power of the network Empowered has built and continues to cultivate throughout Portugal. Martins illustrated how the initial stages of the HQA® Program plant the seeds for extended collaboration throughout the network, which can exponentially increase the program’s economic impact on individuals, institutions, and the nation itself.
“The program, which I’m very passionate about, connects the knowledge of universities and the founders. But these founders are not closed to their own idea and their own business. They are open for the university to ‘Show me you have ideas.’ So, it’s a program that not only involves the talent of the professors, but the talent of the students, especially master’s students. We have a lot of master’s students already involved in the projects,” divulged Martins during a panel discussion with Silva, Branco, and Santos.
“We have a good ecosystem. We are a small country, yes, but we know each other, we share a lot of knowledge, and we are also connecting in other ecosystems together. We are keen on the projects regarding one university, one ecosystem, and we put energy there, but we are open for these people to also connect with one another. And most of them are connecting with people and things are happening. I think that is the most important [part]: people connect, things happen.”
Upward and Onward
As the HQA® Program expands its footprint across Portugal through its partner network of 15 universities and polytechnics, the ripple effects from its growing community of founders are beginning to amplify. Through increased interaction and collaboration, the impact of introducing talented, experienced founders to an environment rich in skill and potential is slowly being revealed.
“As of today, our HQA® Program has facilitated roughly 6.5 million euros of direct investment into research at Portuguese institutions,” disclosed Lennon during his inspiring speech at the “International Talent for Innovation” event in Coimbra.
“But in a few years, when that number hits 50 million euros, and it will, I don’t want people to be focusing on the 50 million euros of direct investment because I want that 50 million euros to actually be an afterthought once you comprehend all of the other collateral impacts that become readily apparent from having partnered with us on this project.”
Learn more about the HQA® Program
