Interview with Cecilie Brøkner, CEO, Innovation Fund Denmark

28 Nov Interview with Cecilie Brøkner, CEO, Innovation Fund Denmark

Innovation Fund Denmark (IFD) aims to fortify and foster strategic research and innovation initiatives throughout the country, challenging traditional investment norms by prioritizing impact over profit. As CEO, what are your strategic vision and goals for the organization, and what are the main projects and critical priority areas for 2024?

We aim to significantly enhance our impact by better collecting and analyzing available data and strategically refining our approach. This goal extends beyond improving investment proposals to our board; it also serves the entire community, including the political level.

As a non-traditional public fund, we rely on yearly negotiations for the research reserve in Denmark, which is part of the finance bill. While this presents challenges in predicting our investment budget beyond a year, it also reflects the strategic decisions of the Danish government. For example, in 2023 we made large, targeted quantum investments in alignment with the government’s new five-year quantum strategy. Danish quantum research stands on the shoulders of giants like Niels Bohr and the Niels Bohr Institute. Danish research institutions are undertaking groundbreaking work within multiple fields of quantum technology research and development and are driving forces behind several international initiatives in the field.

Though we can only plan one year at a time, our investments must build on past knowledge. While innovation requires openness to new ideas, strategic foresight benefits from learning lessons from past experiences. Our commitment to impact involves requiring all applications to address the impact they seek, and we follow up on the value creation of the investments, but we acknowledge the need to improve our impact assessment at the program level. This represents a crucial aspect of our strategic vision moving forward.

Another strategic focus area is to stay active and relevant as governmental instrument for current and future societal challenges – e.g. gearing the public investments with collaborations with private funds or other partners who can benefit from IFD’s expertize on running legitimate and transparent grant processes. There is an enormous need for innovation due to the current geopolitical situation – and at national level to secure our strong grip on life sciences, including securing our national health system which is under pressure.

Of course, a crucial task for IFD is ensuring the success of the four Danish Green Missions, which aim to propel Denmark into a global leadership position in green, circular, and innovative solutions across selected sectors. These missions are: capture and storage or use of C02; green fuels for transport and industry (Power-to-X), climate- and environment-friendly agriculture and food production; and circular economy with a focus on plastics and textiles.

How do you see the economic dynamics of Denmark impacting the innovation landscape?

In Denmark, the unique structure comprises mainly small- and medium-sized enterprises, with a few significant family-owned businesses that have established foundations supporting research and development. These foundations, associated with large companies, have played a crucial role in shaping Denmark’s research landscape in recent years. They bring a long-term perspective and contribute philanthropically and with a vested interest in societal returns.

This dynamic creates both advantages and challenges for a fund like ours. The aim is to effectively leverage both public and private funding, presenting a notable priority for 2024. As a public fund, it is responsible for connecting with, and building bridges to, private foundations. The challenge lies in finding the right approach acknowledging that the foundation should chart its course while collaborating with others.

A preliminary mapping has revealed the foundation assumes a higher risk profile than private foundations, given its unique position of providing free money rather than loans or equity. This distinction emphasizes the foundation’s responsibility to administer funds wisely and ensure that the risks undertaken align with strategic goals. The commitment to a data-based approach becomes crucial in handling the responsibility of allocating resources effectively.

You have mentioned quantum, which is currently a priority for the government, along with life sciences, but are any other specific industries playing a crucial role in sustaining innovation and growth?

We recently secured funding focusing on artificial intelligence (AI), although the amount is relatively modest. Around one-third of all tech projects and 10-20% of all our investments since 2020 have involved some aspect of AI. While it may not be ground-breaking in terms of financial allocation, it highlights a dedicated emphasis on this technology, and we are working on ensuring the intelligent administration of these resources.

Notably, there is a gap in the ethics and public authority aspects, lagging behind the rapid technological advancements. This gap is particularly evident in life sciences and pharmaceuticals, where breakthroughs in personalized medicine and other areas require ethical and regulatory considerations. Our goal is to advance the technological side, but at the same time facilitate that research so the regulatory and ethical dimensions can catch up, ensuring a balanced and responsible approach to AI development.

Additionally, our investments are directed toward green services, aligning with Denmark’s commitment to achieving its 2030 green transition targets. Denmark has embraced a mission-based approach to drive sustainable innovation. While we may not yet have identified the golden solution for governing missions, we are actively engaged in practical efforts, collaborating closely with private companies, academia, and public authorities to address the challenges collectively. This cooperative model aims to translate personal interests and responsibilities into collaborative efforts that benefit society ethically and responsibly.

The IFD recently adopted a new international strategy, a multi-annual strategic investment plan for international cooperation. Can you elaborate on how this strategy will influence your operations and partnerships in the US market, particularly with firms fostering innovation and technological advancements?

Certainly, the international program comprises three main elements. Firstly, a significant part involves facilitating access to EU programs for Danish companies and universities, creating a collaborative environment within the European Commission. Secondly, there is a Nordic element where we collaborate with Nordic partners on shared themes, such as exploring joint calls on AI within the realm of ethics. Thirdly, targeted bilateral collaborations, including the 2021 agreement between Denmark and the US in research and innovation, and a focus on developing technological energy solutions.

The collaboration with the US covers various thematic areas, reflecting the significant market presence and shared interests. These include transport fuels, hydrogen fuel cell power, energy efficiency in buildings and industry, energy systems encompassing wind and solar power, flexibility, and quantum technologies. The agreement involves joint initiatives, such as a forthcoming call in early 2024 in collaboration with the US Department of Energy and their Wind Energy Technologies Office, focusing on energy-related developments.

While our programs prioritize benefiting Danish society, international companies, especially those with a Danish setup, are encouraged to apply. Collaborative efforts with Danish universities are welcomed; we have already seen successful examples of such partnerships. We emphasize the importance of international cooperation, recognizing that addressing global challenges requires collective efforts and mutual support. This collaborative approach extends beyond the international program, shaping our broader perspective on fostering innovation and technological advancements.

In September 2020, Denmark unveiled its inaugural national strategy – Green Solutions of the Future – marking a pivotal step in guiding the country’s investment in green research, technology, and innovation. What measures is IFD taking to promote the energy transition and local sustainability efforts actively?

Well, the concrete result of that emphasis is the creation of the four green missions. This is where approximately one-third of all our annual investments go. So, it is a significant undertaking for IFD and Denmark. It represents a political investment to meet targets and facilitate the transition. It truly embodies the commitment to sustainability and aligns with our national goals.

In light of the government’s recent launch of a quantum research and innovation strategy, Denmark is positioning itself at the forefront of this cutting-edge field. Can you provide insights into the current niche capabilities of Danish companies in vital areas like green energy, AI, quantum, etc? Are there any strategic initiatives implemented by the IFD and is there anything else you would like to mention on fostering growth within these sectors?

I can highlight specific instances. For example, the investment in the Robot- and Drone-hub in Odense, Fyen has proven highly relevant, especially in light of recent events in Ukraine. This showcases the importance of strategic investments even in seemingly niche areas.

Quantum is another notable example where Denmark has specific needs. It demonstrates that progress may take time, as seen in the development of the Quantum Hub over several years. We hope to build on these initiatives for years to come. AI is an area where we face a pressing need, especially considering the labor situation. We aim to make significant strides in this field to address critical challenges.

Life sciences are substantial in Denmark, with Novo Nordisk and other major companies in the sector. To maintain this strong grip, we consistently have to cultivate entrepreneurship and innovation within this area. It remains a key focus. Additionally, Denmark has recognized the need to strengthen its defense capabilities. While this does not imply investments in traditional weaponry, there is potential for dual-use applications within the predominantly small and medium-sized enterprise structure. This involves leveraging technology and capabilities for both civilian and defense purposes. Mapping and identifying these potentials could lead to significant benefits, particularly in protecting critical infrastructure projects related to Power-to-X and carbon capture.

Protecting our investments and developing innovative ways to ensure security should be a priority, especially in light of the current geopolitical challenges and Russia’s assertive approach. The foundation’s responsibility is to contribute to the strategic protection of critical national assets.

Is there anything that we have not discussed that holds particular significance to you? Do you have a final message to the readers of USA Today about choosing Denmark as their next business, employment, and investment destination?

In the current geopolitical landscape, preserving our values becomes increasingly crucial. Ensuring the safety of democracy is paramount. Equally important is the courage to collaborate across borders, share knowledge, and support each other in finding optimal solutions. The challenges we face today extend beyond the capabilities of any single nation, highlighting the necessity of genuine cooperation.

Understanding the strength derived from close collaboration is essential. It is an investment that demands ongoing commitment and awareness to remain resilient. In the face of challenges confronting the Western world on multiple fronts, appreciating and fortifying the foundations laid over the past 50 years becomes imperative.

Choosing Denmark as a destination for employment, business, or investment means aligning with a nation that values collaboration, upholds democratic principles, and actively contributes to overcoming global challenges.