Fondo Puertos 4.0: over €20 million for open innovation at Spanish ports
Fondo Puertos 4.0 (the Port 4.0 fund) has been created to promote open innovation in logistics and port communities, encouraging the development of technological projects in a living ecosystem of start-ups and entrepreneurs. It has been endowed with over €20 million for the next four years and the goal to become a global benchmark in port innovation.
Incorporating solutions from the industry 4.0 and moving towards a Smart Port model is no easy task. It requires talent, funding and, above all, agile management, which allows innovation to blossom in the port sector. In order to promote and encourage these processes, an entrepreneurship plan for innovation in the port sector has been created. Fondo Puertos 4.0 is a joint initiative of all the Spanish ports that will be managed by Puertos del Estado.
This fund’s key for introducing innovation at ports, in addition to providing businesses and entrepreneurs with funds, is to create incubators and accelerators in at least five locations in Spain, where companies will get legal guidance and information on the sector’s needs: “It is difficult for large corporations, including the ones that work in the port environment, to keep pace with changing technology. So, we think there should be an open innovation process in the port sector and that this is the best way of adapting to the new economy 4.0, which is already a reality,” explains José Llorca, head of Innovation for Puertos del Estado, the same public entity he presided over from 2012 to 2018.
A push for the private sector
Llorca is leading this initiative that aims to “encourage the private sector to develop its activities at ports that are committed to innovation,” he explains. “We’re referring to introducing technology like the Internet of Things, big data, robotisation and artificial intelligence into logistics processes.”
This push in the form of “seed investment”, in Llorca’s words, has been motivated by the need of “the whole port community to evolve towards the models and processes marked by this technology,” at the risk of losing its “privileged position in international sea transport.” After all, it isn’t just a commitment from Puertos del Estado, “but by all Spanish ports, proving that all stakeholders are interested in promoting disruptive solutions for this sector,” Llorca explains.
This fund’s key for introducing innovation at ports is to create incubators and accelerators in at least five locations in Spain, where companies will get legal guidance and information on the sector’s needs.
The plan will have three phases: first, a call for ideas and new or emerging start-ups, followed by an incubation or acceleration process for the selected projects (which will take place in the corporate acceleration offices at the ports) and, finally, a new call for subsidies for projects in the pre-commercial and commercial phases.
The projects and ideas funded must fall under one of four focal points:
- Logistics efficiency in the infrastructure, operations or services arena: Eligible projects include solutions for automating operations in terminals, rolling out driverless vehicles, using data to optimise processes or develop predictive models, implementing traceability systems in the logistics chain, etc.
- Process digitalisation and smart platforms: In this case, the plan refers to developing platforms for the various stakeholders in the logistics/port community to exchange data, smart port systems, digital integration with other sectors, systems to ensure the reliability and transparency of operations and information using blockchain technology, to name just a few examples.
- Energy and environmental sustainability: Funding will go to projects on energy efficiency or geared towards reducing emissions of any sort generated through the provision of port services, fostering the circular economy and encouraging use of alternative fuel, among others.
- Safety and protection: The plan covers proposals for remote sensing, early warnings, managing physical risk, cybersecurity systems, automating monitoring and processes, etc.
However, Llorca calls the last two transversal issues that are essential to the new processes of the industry 4.0: “One of the basic pillars of the new economy is the progressive decarbonisation of processes. For example, sea transport is in the middle of a paradigm shift with progressive gasification,” says Llorca. In this regard, “The fund aims to support projects that directly or indirectly lead to a reduction in emissions.”
In terms of companies, the head of Innovation encourages any start-ups and entrepreneurs with ideas that help introduce “all the verticals of technology that promote the economy 4.0” to participate. However, this technology must apply “to products and services that can be marketed and applied in the various areas of logistics but are also scalable and exportable to other industries and countries.” It is a matter, after all, of boosting the Spanish industry and economy through this sector, but with an international vocation that is twofold: “The fund aspires to foster products and services that can be internationalised, as well as encouraging foreign companies interested in developing or applying their technology at Spanish ports to participate.”
The head of Innovation encourages any start-ups and entrepreneurs with ideas that help introduce all the verticals of technology that promote the economy 4.0 to participate.
As has been noted, throughout the plan there will be a structuring element for all the projects: the accelerator or incubator. “Companies are applying different models when they want contact with the most disruptive technology,” explains Lorca, “starting a corporate accelerator or incubator is one of them. We wanted to do something similar. We believe contact with the sector’s needs is essential, and that knowledge and guidance come through creating an incubator, which will have five different locations (decided based on the proposals received) and give the innovative ecosystems in each territory direct contact with the port and logistics sector.”
Keys of Fondo Puertos 4.0
- The goal is to promote disruptive innovation as an element of competitiveness in the public and private port-logistics sector. This element is considered essential to facilitating the sector’s transition into the economy 4.0.
- The fund has been endowed with €20 million, contributed by Spanish ports with each earmarking 1% of their cash flow for the next four years. The fund will be managed, however, by Puertos del Estado. The plan has been kicked off with this endowment of the fund and a tender to select the incubator/accelerator that will manage it and safeguard the development of the chosen projects over the coming 4 years. Once this company has been chosen, the regulations for the fund will be drawn up and the first open call for projects will be launched, expected to be this first semester of 2019, in accordance with law 38/2003 (General Subsidies Act).
- The funding each selected company or project will receive through the fund will range from a set amount of €15,000 for ideas and new or emerging start-ups, from €50,000 to €1,000,000 for start-ups or spin-offs in the development phase with an innovative product in the pre-commercial phase and from €100,000 to €2,000,000 for start-ups or spin-offs in the scale-up or commercialisation phase.
We hope this fund helps make our ports more competitive by incorporating not only latest-generation technological solutions but also the innovative spirit and talent of entrepreneurs and start-ups into the port and logistics environment.