The Development Bank of Jamaica (DBJ) has embarked on the implementation of a new product, the Innovation Grant Fund, to provide financial support for medium-sized companies looking to introduce or expand innovative processes, products, and/or services.
General Manager for Strategic Services at the DBJ, Christopher Brown, tells JIS News that the facility aims to assist entities fulfilling the eligibility criteria to create additional revenue streams and employment, through the provision of a maximum $14-million grant to fund innovation ventures.
The US$2.7-million grant facility is the first of six products being launched by the DBJ under the five-year US$25-million Inter-American Development Bank (IDB)-funded Boosting Innovation, Growth and Entrepreneurship Ecosystems (BIGEE) Programme.
A loan agreement for the BIGEE Programme was signed by Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke, and IDB Caribbean Group Country Department General Manager, Therese Turner Jones, at the engagement’s launch in March.
The initiative is a comprehensive undertaking aimed at building out entrepreneurs and stimulating more innovation from micro, small and medium-sized enterprises (MSMEs), as well as strengthening the innovation and entrepreneurship ecosystem.
Mr. Brown informs that this grant product is designed to support medium-sized entities that have been registered for a minimum of seven years, are generating annual earnings of between $75 million and $150 million, and have a Board of Directors in place.
He advises that the BIGEE Programme also has a funding facility tailored for business start-ups and smaller companies, adding that “our aim is to have both products in the market to support companies at all stages”.
Mr. Brown says that under the two-stage Innovation Grant Fund application process, which opens on September 7, representatives of these entities are invited to log on to the project website: www.thinkbigee.com, fill out the concept note/application form, which provides a basic outline of the proposed engagement, and submit same for evaluation
Evaluations will be undertaken at the end of September or each month, depending on the number of applications meeting the criteria, until the 30 entities being targeted for support are identified.
Mr. Brown says entities passing the concept stage will, thereafter, be invited to submit a comprehensive project proposal, detailing their engagements’ main objectives/goals and how these will be achieved.
He tells JIS News that a $300,000 grant, in the form of a voucher, will be available to assist each entity in preparing their comprehensive project proposals.
The General Manager explains that the grant will enable them to engage the services of a member of the DBJ-accredited list of consultants to assist in writing the proposal “and really helping them to think through and design the project”.
Mr. Brown says the successful applicants will have access to a grant intended to cover 70 per cent of the overall project, up to a maximum of $14 million, with the applicants putting up the remaining 30 per cent as counterpart contribution.
He points out that the businesses’ counterpart input, which can take the form of cash and kind, will be evaluated.
Mr. Brown advises that phased disbursement of grants will be undertaken for each applicant, pointing out that this will be contingent on milestones achieved.
“So if, for example, you’re going to do drawings for a machine being developed or you are in the process of getting a product passed by the Bureau of Standards Jamaica, we advance an initial percentage of the grant for the completion of the specified deliverable. Upon justifying the expenditure, applicants will get another tranche, until the entire sum applied for has been disbursed,” he adds.
Mr. Brown says the plans for the Fund’s development and rollout commenced earlier this year, coinciding with the onset of the coronavirus (COVID-19) outbreak.
He points out that the challenges posed by COVID-19, “re-emphasised the importance of supporting innovation in Jamaica, especially given the type of issues that may face the businesses [consequent on the pandemic]”.
“Now it has become more of a reality that businesses are under severe pressure, given that [some target/traditional] markets have closed.
But instead of their succumbing to the pressure, what they really should be looking to be is innovative. But innovation costs money, whether it’s to test the idea or trying something new or developing a new product,” Mr. Brown argues.
Against this background, he says the DBJ facilitated consultations with several business stakeholders and interests, among them representatives of the Jamaica Manufacturers and Exporters’ Association (JMEA) and the Private Sector Organisation of Jamaica (PSOJ), “for which an intervention like this would be necessary to support [member] businesses at this time, especially given COVID-19”.
Mr. Brown says this engagement will be greatly enhanced by virtue of the “extensive stakeholder sensitisation that’s going to take place outlining what we are looking for from prospective applicants”.
He encourages businesses fitting the criteria for the innovation grant to prepare themselves to take advantage of the opportunity.
“We are living in a new world of business, which requires unconventional products and services or different methods of delivering those in the marketplace. We must innovate,” Mr. Brown underscores.