BACKGROUNDER 

April 27, 2007

INNOVATION DEMONSTRATION FUND

The four-year, $24-million Innovation Demonstration Fund helps companies develop promising new technologies by supporting them at the pilot or demonstration project stage. The fund focuses on new bio-based (made from biological or renewable materials), environmental and alternative energy technologies.  The result will be high-value jobs, future economic prosperity and improved quality of life for Ontario families.

This program targets technologies that have gone through initial testing in the lab, but now need to be tested at the pilot or demonstration stage to see if the technology can be competitive when brought to market.  For example, specific equipment may have to be purchased to pilot the technology or additional expert staff may have to be hired.  A successful pilot often means these technologies have a much greater chance of success than ones at the "idea-only" stage.

The Innovation Demonstration Fund provides initial financial support to companies that have promising ideas, but lack access to conventional sources of financing for a pilot or demonstration project.  All projects will be cost shared between the Ministry of Research and Innovation and the successful applicants. The maximum support that eligible projects are able to receive is $4 million per project.

Investments focus on early-stage technologies that have great potential to succeed.  Priority is given to projects that have the potential to generate a global business.

Other important conditions for investment include:

• The company requires investment to get the technology "off the ground"
• There is high likelihood the company will be able to get future investments from other sources in one to two years
• The company has a significant, long-term operational commitment to Ontario

The Innovation Demonstration Fund is just one component of the McGuinty government's $160-million Ideas to Market strategy ― announced in the 2006 Budget ― that will help companies turn research and ideas into new products and services for the marketplace.

Creating high-skilled, high-paying jobs is integral to Ontario's future economic prosperity.  The Innovation Demonstration Fund represents an initial step in a strategy to grow new technologies and help move innovative ideas to market.