Programme for the Development of Entrepreneurial Investment in Technology (PROFIET)

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The Programme for the Promotion of Entrepreneur Investment in Technology (PROFIET) is an incentive scheme designed to support the development of new technologies in Argentina.
What are the main aims and objectives?

PROFIET aims to enhance the competitiveness of the national production sector by fostering technological innovation and development. Its objectives include promoting the use of technology as a tool to increase the competitiveness of the productive sector and to address priority problems in the social sector, encouraging the creation and consolidation of technology-based companies, encouraging investment in technological ventures, supporting other bodies/institutes creating a market for innovative technological ideas. PROFIET seeks to stimulate collaboration between public and private sectors, promote sustainable development, and strengthen the technological capabilities of Argentine companies. By providing financial assistance and resources, the program aims to drive economic growth, create high-quality jobs, and position Argentina as a leader in technological innovation on a global scale.

How does the program work?

At its core, PROFIET functions as a financial support mechanism, providing various forms of funding to eligible participants, including venture capitalists, investors, and entrepreneurs involved in technology-based projects.

The program works by offering non-reimbursable contributions, which can be utilized for a range of purposes critical to technological advancement. These include funding for patenting processes, enabling companies to protect their intellectual property; supporting the development of research and development (R&D) areas within firms, fostering innovation; and facilitating the creation of technology platforms, which serve as foundations for further technological progress. Additionally, PROFIET provides soft loans and venture capital development funds, further expanding the financial tools available to support R&D and innovation initiatives.

PROFIET's operational focus is strategically aligned with key technological areas that have been identified as crucial for Argentina's economic growth and competitiveness. These priority sectors include biotechnology, nanotechnology, and information and communication technologies (ICT). By concentrating resources on these high-potential fields, the program aims to accelerate development in areas where Argentina can establish a competitive edge in the global market.

The program also works to promote sustainable development and regional technological innovation. This aspect of PROFIET's operation ensures that the benefits of technological advancement are spread across different regions of Argentina and that the innovations supported are environmentally sustainable. Furthermore, PROFIET facilitates international cooperation, enabling Argentine companies and researchers to collaborate with global partners, thus fostering knowledge exchange and expanding market opportunities.

In practice, PROFIET operates by evaluating and selecting projects that align with its objectives and demonstrate potential for significant technological and economic impact. Once selected, these projects receive the necessary financial support and resources to bring their innovative ideas to fruition. This process not only helps individual companies and entrepreneurs but also contributes to building a robust ecosystem for technological innovation in Argentina.

What is the overall cost?

There is currently no information about the cost of PROFIET

How was it implemented?

MINCyT created PROFIET in 2009 and completed its regulatory framework two years later. Operations began in 2012. PROFIET's creation was aligned with the National Strategic Plan for Science, Technology, and Innovation 2006–2010. This alignment ensured that the program supported national priorities in science and technology, fostering an environment conducive to innovation. The Argentine government recognized the need to promote a new knowledge economy to diversify and strengthen growth sources for the country's economy.

The implementation of PROFIET involved collaboration between multiple entities. The project benefited from the participation of various public and private organizations. Key partners included the Ministry of Science, Technology, and Productive Innovation (MINCyT), CONICET (the largest public research institution in Argentina), research institutes, universities, and the private sector. These collaborations were essential for the program's successful implementation and its ability to address the diverse needs of Argentina's innovation ecosystem.

What impact has been measured?

Research found that as of 2012, three companies had received tax credits: Bioceres SA, BioBox SA, and ArgFood SA. Bioceres SA launched a stock offering backed by MINCyT in 2012 where 50% of investors’ purchases were eligible for tax deductions. The Ministry’s action resulted in Bioceres SA attracting close to $30m in capital inflow.

What lessons can be learned?

Argentina remains a prohibitive market for startups. The nation’s regulatory framework contains numerous procedures, costing time and financial resources. In 2012, the country ranked 154th out of 185 countries in “starting a business.” PROFIET exemplifies a measure that softens some of the adverse effects of Argentina’s excessive red tape.

Notes + Additional Context

CURATED BY

Cristina Fernandez

Director for Knowledge + Programming
Global Entrepreneurship Network
United States