Advanced Braking Technology chief executive Ken Johnsen has secured the largest grant of any company in Australia.
WOULD you like $200,000 to help cover the cost of a new business development manager? How about $2 million to help fund the development of your new product?
If so, then you might want to follow the example of Western Australian businesses like Advanced Braking Technology, Industrial Composite Contractors and Saron Education.
They are among a dozen local businesses to have secured grants from federal government agency Commercialisation Australia.
Nationally, 154 companies developing new products and technologies have been granted just more than $61 million during the past two years. WA is underweight among the recipients, especially when it comes to the amount of money heading west.
The 12 WA businesses have been awarded a total of $4.2 million, with nearly half this figure attributable to just one business, Advanced Braking Technology.
Headed by experienced chief executive Ken Johnsen, the ASX-listed company has been awarded $2 million – the maximum amount available – to accelerate the market entry of a new braking system for rubbish trucks.
At the other end of the spectrum, start-up businesses such as Rytech Australia and Mode Ideas that are new to the commercialisation process have been awarded grants of $50,000 to help them acquire relevant skills and knowledge.
Mr Johnsen is an old hand when it comes to working with government, having been a senior executive at Orbital Engine Corporation for nearly two decades.
“They always ask, can you raise more capital? Why don’t you borrow the money?” Mr Johnsen told WA Business News.
Advanced Braking has already raised capital from private investors, and will be matching the government funding dollar-for-dollar as it progresses the new application of its technology.
The company’s core market is fitting its braking system to mining trucks. On the back of that market, it has lifted sales revenue to $7.2 million and delivered a maiden profit last financial year.
Advanced Braking used private funding to trial its braking system on garbage trucks, which traditionally put enormous stress on brakes because of their constant stopping.
“In terms of getting the grant, that was very valuable because we had independent verification of the proof of concept,” Mr Johnsen said.
The next step will be a trial using 100 garbage trucks to confirm the braking system’s performance in the field, with a production decision due next year.
Mr Johnsen noted that Advanced Braking’s grant is akin to a loan; once the company starts product sales from the technology, 5 per cent of attributable revenue will have to be paid back.
That condition does not apply to other grants that are designed for businesses at an earlier stage in the commercialisation process.
For software developer Saron Education, the process of getting a grant was challenging.
“There was quite a bit of work involved in applying for it in the first place, and then reporting on it, but it was totally worth it for a small start-up like ours,” Saron director Grant Grosser said.
He highlighted the importance of the government-appointed case managers, who drive the grant application process. This is a notable change from the old Commercial Ready grants scheme.
“The case manager is very, very important in the process,” Mr Grosser said. “It really hangs on their ability to argue your case.”
Saron has ended up getting two grants from CA. Its initial $84,000 grant (which had to be matched 50:50 by private funds) was used to develop a proof of concept for its SEQTA Coneqt product, a web-based application designed to help teachers deliver course work and other information to parents and students.
It subsequently obtained a second $200,000 grant (also matched 50:50) to hire a business development executive to market the SEQTA product suite.
Perth inventor Zachary Goss was one of the earliest recipients of a CA grant, in April last year.
He was awarded $50,000 to help develop his ‘coals to Newcastle’ business idea – a new braking and security device for snowboards.
Mr Goss used the funds for market research, risk analysis, establishing an intellectual property strategy and developing a business plan.
Another recipient of a $50,000 ‘skills and knowledge’ grant was Rytech Australia, which plans to develop a business plan for its wave energy device.
Virtual Observer took a different tack when seeking support. It obtained a $130,000 grant (to be matched 50:50 with its own funds) to hire an experienced executive to lead the development of its mobile video data product.
Its core technology allows users to search video data by time and location. Customers include Curtin University, which uses the technology to augment its network of security videos mounted on cars.
