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The power of business clusters

The power of business clusters
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Business Planet travels to the Czech Republic to see how one nanotechnology cluster is helping SMEs scale-up and go international.

​When it comes to business it is often the case that birds of a feather flock together: the idea that companies of a similar type locate in the same place. The 19th-century economist Alfred Marshall said proximity created something "in the air". Marshall was referring to manufacturing in the Victorian era, like the textile industry in Lancashire, but it still stands true for many sectors today. Silicon Valley or the more recent high-tech hubs in London and Berlin are more modern-day examples. Companies realise that huddling together can derive benefits, such as cutting supply chain costs or making hiring specialists easier. It can also lead to increased innovation, collaboration and productivity. It soon becomes clear that maximising the potential of such business hubs also makes sense from a wider economic perspective. In that respect, cluster organisations can play a key role.

​Nanotechnology hub

​Thanks to several factors the Czech Republic, and the northern city of Liberec, has become a nanotechnology hub. Working closely with the local technical university, the city is home to a host of small firms that are developing products with nanofibers - material that can be 80,000 times smaller than a human hair.

Nanopharma is one such company. The firm has developed, among other things, a cosmetic mask that uses nanofiber technology. Business Planet reporter Paul Hackett spoke to Nanopharma's CEO, Kateřina Vodseďálková and tried out the mask for himself.

​Paul Hackett: “Katerina... what's so special about (the mask) it?”

Kateřina Vodseďálková:​"Nanofibers are special about this mask because they're able to increase more active ingredients, per centimetre square than any other material currently in use. It's a dry very effective mask, which does not irritate even the most sensitive skin. It's easy and quick to apply and it's 100 per cent biodegradable, so it's eco-friendly.”

Clustering can = higher growth

​Nanopharma is a member of Nanoprogress, a cluster that aims to maximise Liberec's tech talent by boosting innovation, collaboration and job creation among the city's high-tech SMEs.

​“We are supporting the whole value chain of our SMEs,” says Nanoprogress Chairman, Luboš Komárek, adding: “I’m talking about internationalisation and I'm talking about innovation and product and process development. And together with other European partners we created a legal structure and are helping companies to enter China, the USA and Canada.”

​In addition to helping firms inside the cluster go global, Komárek says Nanoprogress' members enjoy better results than the industry average.

​“We have supported more than 40 companies. We have helped them to develop more than 20 products. And these companies in terms of results show 5 to 10 per cent higher growth in terms of job creation and competitivity than the average.”

When it comes to opening new markets, Vodseďálková says the cluster played a key role.

"Nanoprogress connected us with a French cosmetic cluster and helped us to open the French market for our dry masks. Currently, they are helping us to sell our masks in Canada, China and the USA."

Nanoprogress is part of the European Initiative of Cluster Excellence. It was supported by COSME, Horizon 2020 and the Regional Development Fund. The EU programmes seek to boost innovation, competitivity and make it easier for SME's to get access to finance. Business Planet spoke to the award-winning cluster's Chairman Luboš Komárek to find out more about what the organisation does for its members.

What activities and services do you provide for the firms within your cluster?

​"The main activity of our cluster is the support of research and development. Together with our members we are executing joint research projects and we take the administrative burden from the projects, so essentially, we are managing all the projects and the members can do their job, the companies can do their product development and the researchers can do their research, so this is one of the activities. Another activity is that we are creating open innovation centres....within the centres we include new technology for the production of nanofibers and some equipment for analysis and these centres are open for our members to develop their research and their project activities. Furthermore, we also use the cluster organisation and our international partners to support the internationalisation of our members."

_​_How are you helping the firms within your cluster go international?

​"We are using our partnership network with other cluster organisations in Europe. Furthermore, we are using the support of the European Commission and currently we are preparing three missions, to three markets – Canada, the U.S. and China. On these missions we are finding the best counterparts of these markets for our members and we will bring 18 companies to each market....Our aim is to create open collaboration in Canada, the US and China and bring products and services to these markets from Europe."

What support have you had from Europe? ​

"We are using many European funds. For instance, we use the European Regional Development Fund for supporting the joint research, development and the creation of the centres. We are using COSME and Horizon 2020 for supporting the innovation of the SMEs...Basically, with this support they get financial means to develop new products to improve new technology, so this really is very important and due to the Commission we have the opportunity to provide added value to our members because without these programmes and without this support, none of this would be possible."

If you're a small or medium sized business and are interested in becoming part of a cluster, where can you go to find out more information?

​"In the European space, there are more than 1000 very active cluster organisations, from many many industrial fields. So it's not just nanotechnology, it's also technologies, IT clusters, furniture clusters, many, many sectors. And the easiest way on how to get information about these clusters is to go to the cluster collaboration portal, which is essentially the most important platform at the EU level...you can find specific clusters in a specific sector in a specific country and you can check the profiles of the clusters and you can contact the local cluster managers and they will guide you on how to join the cluster and how to use all the possibilities that this eco-system brings."

Key Enabling Technology

​Nanotechnology is recognised by the EU as one of six Key Enabling Technologies or KETs. Micro and nanoelectronics, industrial biotechnology, advanced materials, photonics, and advanced manufacturing technologies are the others.

​Nanotechnologies are starting to touch every aspect of our lives: electronics, medicines, everyday products, our cars and our homes. It is hoped research in this area will lead to new products and services capable of enhancing human health while conserving resources and protecting the environment.

​Business clusters: the benefits

  • ​Clusters bring together specialised companies, often SMEs, and other actors that work closely together in a particular location.
  • By working together, SMEs can be more innovative, create more jobs and register more international trademarks and patents than they would alone.
  • Nanoprogress is a cluster focused on promoting nanotechnology in the Czech Republic. They are part of the European Initiative of Cluster Excellence, a European Union initiative that supports clusters across the EU.
  • Nanotechnology is one of six key enabling technologies (KETs) and has great potential for addressing societal challenges, including energy supply and health care.
  • The EU supports investment in KETs and helps entrepreneurs access KETs technology infrastructures.
  • The EU Cluster Portal provides tools and information on key European initiatives, actions and events for clusters and their SMEs with the aim of creating more world-class clusters across the EU.
  • The European Cluster Observatory – provides information, mapping tools and analysis.

​Useful links

​EU support for clusters

European Cluster Collaboration Platform

Key enabling technologies